Key takeaways
- Consumers can find travel credit cards that are co-branded with a specific airline or hotel loyalty program, as well as general travel credit cards that apply to most types of travel.
- Many frequent travelers sign up for a new travel credit card in order to score a big welcome bonus, yet it’s crucial to consider a card’s long-term value, as well.
- With travel credit card annual fees ranging from $0 to $695 (or more), consumers will need to assess the value of the travel perks they’ll receive to know if an individual card makes sense for them.
- Ultimately, the best travel credit card for consumers will be the one that gets them the most in rewards and benefits for the annual fee they pay.
Choosing the best travel credit card can be a tough decision, mostly because there are multiple card issuers, rewards programs, and types of travel rewards you can earn. That said, the right travel credit card can help you earn points or miles for free travel and improve your travel experience. After all, many top travel credit cards come with annual free nights, travel insurance, waived checked baggage fees, airport lounge access, and more.
Before you choose a travel credit card, you’ll need to understand which type of travel card best suits your spending style and travel needs. Below are five steps to follow to help you choose the best card for traveling:
1. Decide between a co-branded or general travel credit card
Before you do anything else, you’ll want to think long and hard about the type of travel rewards you want to earn. You can start by considering how much flexibility you’d like when it comes to redeeming points or miles, along with your typical travel style and whether you have any preferred airlines or hotels.
When looking for the best credit card for travel rewards, there are two primary types of travel credit cards to consider: co-branded travel credit cards and general travel rewards credit cards.
Quick definitions
- Co-branded travel credit card
- Co-branded travel credit cards are issued by a bank in partnership with a specific airline or hotel loyalty program. Earn rewards in the form of the loyalty currency of the airline or hotel. You have the option to redeem your miles for statement credits, use them for travel purchases through the portal, or transfer them to Capital One travel partners for added value.
4. Determine which travel perks are most important to you
When looking for a travel credit card, consider the benefits and protections that matter most to you. Look for a card that offers perks you can actually use to offset the annual fee and maximize the value you receive each year.
Premium travel cards often come with the most benefits, but they also typically have higher annual fees. For example, The Platinum Card® from American Express offers over $1,000 worth of benefits for a $695 annual fee. It’s important to evaluate whether you can take advantage of enough of these benefits to justify the cost of the card.
As you compare travel credit cards with valuable perks, look for benefits like:
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Look for credit cards that offer Priority Pass Select airport lounge memberships or access to select lounges a certain number of times per year. Some cards even have their own airport lounge networks for eligible cardholders. Consider whether the card extends this perk to authorized users as well.
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Some cards allow you to earn elite-qualifying points or miles toward airline elite status through credit card spending, helping you achieve status with less spending on flights.
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Look for cards that offer benefits like free checked bags, priority boarding, and in-flight discounts, as well as other perks specific to airlines that can enhance your travel experience.
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Look for cards that offer automatic hotel elite status, providing benefits like complimentary room upgrades, late check-out, and bonus points on stays.
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Consider cards that offer annual credits for eligible hotel stays, helping offset the cost of accommodations and providing additional value for cardholders.
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Look for cards that offer annual credits for travel purchases, airline incidentals, subscription services, and more, helping offset the annual fee and providing additional value. Additionally, consider cards that offer travel insurance benefits to protect your trips and provide peace of mind.
5. Calculate to minimize fees
When evaluating travel credit cards, consider the annual fee and the benefits you’ll receive in return. Cards with annual fees under $100 are often worth it, especially in the first year when you can take advantage of welcome bonuses and rewards earned on spending.
For example, the Chase Sapphire Preferred® Card offers valuable benefits for its annual fee.
Currently, this card offers a sign-up bonus of 60,000 points when you spend $4,000 within three months of opening an account. These points are valued at $750 in travel when booked through Chase Travel℠, which easily covers the $95 annual fee.
However, there are travel credit cards available with no annual fee that provide good value. For instance, the Discover it® Miles card has a $0 annual fee and offers unlimited 1.5X miles on all purchases. Additionally, Discover matches all the miles earned at the end of your first year.
It’s crucial to consider foreign transaction fees when choosing a travel credit card. While most travel credit cards waive this fee, some do not. These fees typically amount to around 3 percent of each transaction made in a foreign currency, which can accumulate quickly if you frequently spend overseas. In this case, a credit card with no foreign transaction fees, even if it comes with an annual fee, might be more cost-effective in the long term.
The key takeaway
The ideal travel credit card for you will depend on factors such as your travel frequency, preferred rewards, desired benefits, and willingness to pay for the card. Fortunately, there is a wide range of exceptional travel rewards credit cards available, ensuring that you’ll find one that fits your requirements.
Take the time to compare our selection of the top travel credit cards and make an informed decision based on your research. Remember, you’re not locked into one card forever. If you find that the card you choose doesn’t meet your expectations, you can always request a product change or apply for a different card that better aligns with your needs.
Bankrate has independently gathered information on the AAdvantage® Aviator® Red World Elite Mastercard® and Citi® / AAdvantage® Platinum Select® World Elite Mastercard® and it has not been reviewed or approved by the issuer.
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