My New Favorite Credit Card

For the last year and a half I have been exclusively using my Capital One credit card. At 6.9% I just couldn't pass up the interest rate. Now that I'm settled into my first house Ive realized that despite every surprise or hiccup along the way, I always pay off my balance. Therefore it doesnt matter what my interest rate is, Im never paying it. So off I went to look for the best no-fee credit card I could find.

Hands down it is the MBNA Starwood Preferred Guest Mastercard. They start you off with 5,000 points and give you another 5,000 the first time you stay at a Starwood Hotel/Resort. You also receive 1 point for every $2 spent, plus a 5,000 bonus at each of $10,000, $20,000, $30,000. So spending at each of these levels is equal to 1 point per dollar.

The best part for me is that the points are transferrable to 30 different airlines, with 5,000 bonus points being given for every 20,000 transferred. Using American Airlines as an example, flights from Toronto to anywhere in the US (that I have seen) are 25,000 miles. Because of the bonus 5,000 you only use 20,000 points.

For me this works out to a free flight every year with $20,000 spent on the card. A 1% dividend card would only yeild $200/year with this amount of spending versus approximately $400 for the flight. The points are even more valuable if you use the points for hotel stays (starting at 2,000/night).

What is your favorite credit card?