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Why Seniors Should Love Travel Rewards Credit Cards

The fact that seniors are participating in rewards programs at a higher rate than any other demographic is something to celebrate. With a lifetime of work behind them, they're due their share of the spoils.
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Although rewards credit cards seem to be everywhere these days, the popularity of credit card loyalty programs is actually on the decline. According to a report from Mercator Advisory Group, credit card rewards participation in the U.S. dropped from a high of 76 percent in 2012 to 68 percent in 2013. So, while the advertising for these offers continues to reach critical mass, the actual sign-ups appear to be waning.

However, a slice of the population you wouldn't expect appears to be lining up for more than their share. According to the report, 81 percent of senior citizens belonged to at least one credit card rewards program in 2013, compared to only 57 percent of young adults.

So, why the disparity?

Is it possible that rewards-loving senior citizens know something we don't know when it comes to travel rewards? Probably. Or maybe it's the slew of rewards and perks these cards offer that continue to draw seniors in droves. Although all travel rewards cards work differently, most allow you to earn points that are redeemable for anything from free hotel stays to free airfare, gift cards, merchandise or cash back.

The fact that senior citizens are taking advantage in larger numbers actually makes a lot of sense. Here's why:

Seniors have time. When you're busy raising a family and building a career, finding time to travel can be an impossibility. But seniors don't have that problem; instead, they've got the opposite issue. Simply put, retired seniors have the extra time to take advantage of the travel offers the younger generation cannot.

The older generation have already established credit histories. While the younger generation can be scared of debt or worried about the impact of a new inquiry on their credit reports, retired seniors may have little to worry about. Their credit histories were established long ago, and chances are, they don't plan on borrowing money any time soon.

Senior citizens are ready to enjoy retirement. A lifetime of work and raising a family can mean missing out on many of the things you wanted to do with your life. Whether that's visiting a relative in Maine or simply digging your toes into the soft sands of the Gulf Coast, there's no better time to do it than in retirement.

They're using travel rewards to check off their bucket lists. While some seniors and retirees use travel rewards for leisure, others use them for aspirational trips across the globe. Airline miles and hotel loyalty points make it possible to travel nearly anywhere you want in the world for pennies on the dollar. With travel rewards, far-flung destinations may finally be within reach -- and within the means of a modest budget.

The fact that seniors are participating in rewards programs at a higher rate than any other demographic is something to celebrate. With a lifetime of work behind them, they're due their share of the spoils.

And maybe, after all this time, travel rewards are helping them do something they couldn't do when they were raising families and holding down steady jobs, and that's travel the world at their own pace.

Of course, travel rewards credit cards don't come without their share of risks, including the threat of debt. In order for seniors (and anyone, really) to get the most out of the loyalty programs they join and the credit cards they sign up for, they need to commit to remaining debt-free. For most people, that means pledging to pay their bill in full -- and on time -- every single month.

Other things to watch out for include the array of fees charged not only by travel rewards credit cards, but by all types of cards. These charges can include late fees, overlimit fees, cash advance fees and even foreign transaction fees. Anyone who hopes to get the most out of travel rewards cards needs to know all about these charges, and most importantly, how to avoid them.

Still, with the right strategy -- and a dedication to using rewards the right way -- many seniors can spend their golden years seeing the world at prices they can actually afford.

Holly Johnson is the founder of travel website, Travel Blue Book, which covers travel experiences ranging from cruising to fine dining. Holly also writes about frugal living, travel and budgeting on her other website, Club Thrifty, and at Get Rich Slowly, Frugal Travel Guy, Personal Capital and many other online publications.