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Credit Cards for Senior Citizens

For senior citizens, credit cards can be useful tools for helping achieve a range of retirement goals, from international travel to saving on everyday purchases. 

By Mike Faden | American Express Credit Intel Freelance Contributor

6 Min Read | August 13, 2020 in Cards

 

At-A-Glance

For senior citizens, rewards credit cards may help with a variety of goals and everyday activities, from international travel to grocery shopping.

If travel is a retirement goal, travel rewards credit cards provide points toward flights and hotels, along with perks that can make travel more relaxing.

Cash back cards can help a fixed income stretch further by providing money back on everyday spending.

In your golden years, you generally have more time to do whatever you want – whether that means international or domestic travel, eating out with friends, or simply taking it easy. On the other hand, many senior citizens have more-or-less fixed incomes, so you may also be looking for ways to help your dollars stretch further toward those goals.   

 

Used responsibly, credit cards can be handy tools to help senior citizens achieve all of the above. A wide variety of credit cards offer different benefits for senior citizens. So, it’s important to consider your goals, spending patterns, and financial resources when choosing credit cards to meet your needs. Two main categories of credit cards can assist: 

 

Rewards credit cards: With rewards credit cards, you earn rewards points as you spend with the card. You may also earn additional sign-up bonus points for reaching specific spending milestones – typically averaging a few thousand dollars – within a few months of getting the card. You can redeem your points for travel, dining, entertainment, gift cards, or other benefits.

 

Cash back credit cards: These work similarly to rewards cards, but instead of rewards points you get cash back, usually as a statement credit.

 

Credit Cards Offer Additional Protections

For many senior citizens, it may be helpful to know that some credit card providers include certain protections that may help when unpredictable circumstances arise. Depending on the card, these benefits vary and may include:

 

  • Worldwide assistance: A hotline that provides travel-related information as well as help if you encounter problems far from home, including medical emergency referrals and support if you lose your passport.
  • Protection for purchases: Some cards provide extended warranties and/or protection against damage or theft for a limited period, including refunds under some conditions.
  • Car rental insurance benefit: You may be covered for vehicle damage or theft under certain conditions when you pay for a car rental using the credit card and decline the rental company’s collision damage waiver. 

 

Travel Credit Cards for Senior Citizens

For many senior citizens, retirement presents terrific opportunities for travel. There’s more time to plan and enjoy extended trips without the constraints of a 9-to-5 working schedule. If travel appeals to you, a travel credit card may offer useful perks. With a travel rewards credit card, you generally earn points for all spending but get the highest ratio of points per dollar for travel-related purchases, like flights and hotel stays. You can then redeem those points toward more flights, hotels, tours, or other travel. There are several kinds of travel rewards credit card:

  • Airline credit cards are co-branded by a credit card company and an airline, and generally offer the highest level of rewards with that airline.
  • Hotel credit cards are provided by a credit card company in partnership with a hotel chain, and you’ll generally get the most benefits when you use them for properties owned by that chain.
  • General purpose travel credit cards give you the flexibility to earn and redeem points with multiple airline and hotel companies. 

Within each of these card types, there are different “tiers” of credit cards. Top-level premium cards offer the highest rewards, including the most points per dollar in targeted spending categories. But they may have higher annual fees, up to several hundred dollars. 

 

If, as a senior citizen, you have the flexibility to travel off-peak, you may benefit from a change in the way many airlines and hotels are pricing their reward travel. Instead of requiring a fixed number of points for a flight or hotel stay, they’re using “dynamic pricing.” That means the number of points needed varies depending on the price that you’d pay in dollars, which in turn depends on how much demand there is for that particular seat. If you’re able to travel when demand is low, you may need fewer points for your flight or hotel stay.

 

Credit Card Benefits that can Reduce Travel Stress for Seniors

Some travel credit cards also include benefits that can help make travel less stressful. Depending on the card, those benefits may include:

  • Airport lounge access: For 20-somethings, hunting for a seat in a crowded airport may be part of the fun of travel, but most seniors prefer a more relaxing experience. Some travel credit cards provide complimentary or discounted access to a worldwide network of airport lounges, which can provide a welcome respite from airport hubbub – often with food, drink, and Wi-Fi on tap.
  • Faster security screening: Some credit cards provide credits toward programs that help get you through airport screening and customs faster, so you spend less time standing in line.
  • No foreign transaction fees: Some credit card providers eliminate foreign transaction fees, so you don’t need to worry about extra cost that might otherwise be added to each purchase in a foreign currency.
  • Hotel elite status and upgrades: You may automatically get elite status when you enroll in hotel loyalty programs, with potential benefits such as upgrades to cushier rooms.
  • Trip cancellation and baggage insurance: If you pay for your trip with your credit card, you may be reimbursed up to preset limits if your trip is cancelled or delayed or if your baggage is lost, stolen, or damaged.

 

Earning Cash Back with Credit Cards

Cash back credit cards may be useful for senior citizens whose priorities include making their money go further for everyday purchases, since they tend to reward spending in categories such as supermarkets and restaurants. As you spend with a cash back credit card, you get a percentage of the cash back, usually as a statement credit, and some credit cards also offer introductory cash back bonuses of several hundred dollars if you meet certain spending requirements within the first few months of getting the card. You’ll generally get at least 1% cash back on all purchases, with higher percentages for specific spending categories such as supermarkets, restaurants, and U.S. gas stations.

 

Credit Cards with No Annual Fee or Low APR

If you’re focused on minimizing fees and interest, you may consider low or 0% intro APR credit cards, although these cards may offer fewer rewards and perks than others.

 

The Takeaway

Senior citizens may find rewards and cash back credit cards to be useful tools for helping to achieve a range of retirement goals, from international and domestic travel to simply making the most of a fixed income. A wide variety of credit cards offer different benefits, so think carefully about your goals and spending habits when choosing cards to meet your needs.

Mike Faden

Mike Faden has covered business and technology issues for more than 30 years as a writer, consultant, and analyst for media brands, market-research firms, startups, and established corporations.

 

All Credit Intel content is written by freelance authors and commissioned and paid for by American Express. 

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