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The Ultimate Travel Credit Card Guide

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Travel Credit Card
Catherine Miller
Catherine Miller
May. 01, 20223 min read
Travel can be expensive. With the cost of flights, hotel rooms, travel insurance, and more, if you’re traveling regularly for leisure, work, or family reasons, it can quickly add up. But what if you could reduce your travel costs every time you used your credit card?

These days, you can pick from a wide range of travel credit cards designed to help you do just that. Unlike standard credit cards, most travel credit cards link your spending to a rewards program of some kind, enabling you to collect and use points or airline miles, get perks and discounts, and even add insurance. Though different travel cards have different systems, in general, the more you spend on your card, the more rewards you’ll get.

And there are lots of options out there, including some from major travel brands. With so many credit cards for travel to choose from, how do you know how to pick the right one? We run through what to look for in a travel rewards card so you can find the best deal for you.

What to Look for in a Travel Card

Co-branded vs. general travel credit card

The first thing to consider when looking for a travel rewards credit card is whether you want to get a co-branded card or a general travel card. A co-branded card is connected to a rewards account with a specific company, such as an airline or hotel chain, so the points and perks can usually only be used with that company.

This is great if you are loyal to a particular brand. If you always travel with a particular airline, for example, you can quickly collect air miles through everyday and travel purchases, leading to rewards like free flights and free checked bags. A hotel chain credit card could give you discounted stays, reduced booking fees, and even discounts for day trips, spa treatments, or experiences.

If you’re not wedded to using one particular brand, you might want to go for a more general travel credit card. These will let you collect points or rewards that can be used across multiple brands. This might be preferable if you want more flexibility. The downside is that there may be a higher annual fee, and you might be subject to more stringent credit score requirements if you want to get a general travel credit card.

Rewards and bonuses

Next, it’s important to consider the different rewards and bonuses you can pick up with each card. Many cards offer a welcome bonus, which should certainly sweeten the deal! If this is in the form of free air miles, for example, you could easily get enough miles for a free flight.

Note that in order to qualify for a welcome bonus, you’ll usually need to spend a certain amount on your card within a set time limit after opening your account . So you should also take into account how much you’ll need to spend in order to get the extra miles or points. Overextending yourself just to reach the bonus limit could see you lose money rather than gaining an extra perk.

The welcome bonus is also only one part of the reward structure when it comes to rewards credit cards. Check out how many points or miles you’ll accrue from each transaction, and whether you get rewarded for all transactions or only for spending in certain categories, such as dining, travel, or groceries.

For example, if you don’t own a car, there’s no point in getting a card that gives you extra points on gas payments. A card with a flat reward rate can be easier to keep track of, although you may miss out on a higher rate for some purchases.

If you’re hoping to collect and use air miles, look into how much bang you’ll get for your buck. Check how much each mile is worth and how many miles you’ll earn per dollar spent. If it’s an airline-specific card, you might also want to check the average fares for the kind of journeys you normally make.

Additionally, air miles can sometimes have a time limit or expiry date. If you don’t think you’ll travel enough to actually use them, then it might be worth getting a card with no limitations.

Travel perks that matter to you

Collecting travel rewards isn’t just about points or air miles. Lots of travel credit cards give you other perks that can make traveling easier and more comfortable. This can include useful insurance including rental car coverage, protection for trip cancellation, or insurance for baggage delays—helpful if you run into unexpected issues! You may also be able to get other perks, like access to airport lounges, priority boarding, or free days at certain hotels or resorts.

When choosing a card, you should consider carefully which perks would really matter to you. For example, do you often rent a car when on vacation? In that case, the rental coverage will probably come in handy. Or, if you travel for work, airport lounge access could give you more vital working hours in a comfy space.

Keeping the fees down

While dreaming of perks can be fun, you should also factor any annual fees or minimum spends into your decision on a travel rewards credit card.

Some travel credit cards can be expensive to use, with annual fees into the hundreds. Make sure to check that the money you’ll save with perks will be more overall than any extra fees you’ll be paying. Of course, if there’s a great-value welcome bonus or a perk you will use a lot, it may be worth paying an annual fee.

Do the math to make sure you’re not paying more than you need to! For example, if a credit card’s welcome bonus is worth more than $1,000, with an annual fee of less than $100, and a minimum spend you’d be paying out anyway, you’ll be getting a lot of value.

There are also travel credit cards out there with no annual fee, so even if you’re on a budget, you can still get perks and bonuses.

Another factor to consider is foreign transaction fees. Some cards will charge extra if you use them outside the US. Usually these are around 3% of each transaction. Picking a card with no foreign transaction fees might be sensible if you’re planning to use the card a lot while abroad. As with any credit card, you should check the Annual Percentage Rate (APR) on everyday spending, too.

Summary

There’s a lot to think about when it comes to picking a travel credit card, but if you put in a little work now, you should be able to find one that will bring you the maximum reward.

Consider how you spend with your credit card most often and make sure your chosen travel reward card will fit your buying habits. Make sure you’re factoring in fees and minimum spends, balancing these against the points, air miles, and travel perks on offer. Plus, if you’re loyal to a particular airline or hotel brand, check out their brand-specific cards and see if these might be the right choice for you.

Whatever you decide, once you’ve picked your card, enjoy watching those points roll in, and look forward to the day you can spend them on a fantastic travel experience!

Catherine Miller
Written byCatherine Miller

Catherine Miller is a lead member of personal finance and pension innovator Maji, where’s she’s responsible for content creation and running Maji’s personal finance masterclass, among others. She is also a freelance writer in the fields of finance and education, and holds degrees in English and education.

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