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How to choose a travel card

03.06.2021
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13 min.

Choosing a proper card

Points and travel benefits that accumulate through travel rewarding programs may often be received through the card issuer's website or app or displayed in the form of an account statement reimbursing previous travel-related and daily buying with a credit card of such type. Bonuses or miles can also be transferred to travel partners (mostly hotels and airlines) at varying conversion rates and afterwards can be utilized for booking flights or hotel rooms.

How to choose a travel card

Below are several key factors which should be considered while choosing an appropriate card:

  • Annual charges. Most traveling rewards program claim per annum fees with some up to $550 but they are usually mitigated by monthly or annual credits.
  • Overseas transaction fees. Since such fees are not forced by any of the best travel cards options clients don't have to worry about this issue.
  • Exclusive benefits. Some of rewarding card options also grant access such to exclusive benefits as airline lounges, priority boarding or VIP hotel reception. The rewards value is subjective and better to be assessed upon a customer's needs and wishes.

The ways credit cards for traveling operate

"Traveling promotion credit card" is a term of wide comprehension actually encompassing various cards. Indeed, cards not necessarily considered as travel rewarding ones can provide such bonuses in case holders use them in a proper manner.

Several distinct categories of credit cards rewarding travels exist. Below is their list.

Types of credit cards for traveling

Transferrable rewards

These cards allow to accumulate rewards which are frequently referred to proprietary like Membership Rewards being a part of American Express's program or Ultimate Rewards included in Chase's program as well as the rewards are either used in this proprietary system or transferred to different loyalty programs such as those for frequent airline flyers or hotel quests.

Note! Bonuses or rewards aren't guaranteed to be directly related to the actual value of a desirable service.

This issue is really evident for airline premium flights as normally, the points number to be redeemed for a certain flight is not enough because of the flight's actual monetary fluctuation (which is actually not a rare case). Regardless either the actual flight's cost is $ 250 or $ 500 the same quantity of miles is likely to be required.

Sometimes options like the Chase Sapphire Preferred and others of Chase Ultimate Rewards grant rewarding of monetary value provided it is redeemed through the Ultimate Rewards Travel Portal or else points if transferred to one of several hotels and airlines loyalty programs.

Fixed and cash value

Vast flexibility of rewards for travelling is provided as such cards are typically not tied to a particular brand of hotels or airlines. Thus, receiving maximum bonuses for flying with a definite airline or staying at a definite hotel chain in not the subject to worry about, instead miles or awards are of a fixed value which is typically $0.01.

These credit cards' usage allows to cover travel purchases with the following rewards repayment in the form of a loan for this purchase redeeming. Let's imagine the situation when you need to book a flight for a round trip which costs $ 500. You pay with a card and utilize 50,000 miles at bonus account as credit for covering the total ticket's cost.

  • Advantages are: when it comes to earning rewards this type of cards enables to double dipping. Thus, paying for a hotel stay or a plane ticket with a credit card anyway it is possible to receive rewards through the airline or hotel's loyalty programs. Rewards can be later used to defray expenses. In case rewards are exchanged directly at hotels or airlines means bonuses for those flights or stays will not be obtained.
  • Among disadvantages are: cardholders cannot transfer bonuses to various loyalty programs to avail of discounted rates or loyalty reward prices.

Airlines rewards

Airline rewarding credit cards are connected with certain programs for frequent flyers. Bonuses are provided as a particular airline' miles or points. Often the highest rewards are offered for buying at definite airlines but the number of additional categories increase has been observed for the past time as issuers compete for clients.

  • This type's strong sides. Purchasing with a card or any welcome bonus earned can help progress towards the chosen airline status levels. One more benefit is upon a credit card closure rewards received are generally kept as they are tied not to a credit card but to a client's frequent flyer account. Moreover, airline-branded card holders may enjoy a variety of benefits such as free checked-in baggage, upgrades, access to significantly discounted tickets, etc.
  • Disadvantages include: the ways of rewards getting are rather limited. Besides, customers usually have to accumulate a large amount bonuses before being able to spend them on traveling.

Hotel rewards

Likewise for airlines, the rewards earned are accumulated on a hotel loyalty account.

  • Positive points are: purchasing with a credit card can appear to a helpful tool for achieving a definite status of the chosen hotel brand and generally keeping bonuses generally upon a credit card closure. Additionally, many hotel brand credit cards grant cardholders a free overnight stay every year upon card renewal has been done.
  • Negative points include: rewards earning is usually restricted by staying at a definite hotel chain.

Obtaining a proper credit card for traveling

Despite the best options can offer a lot, it is really important to find a card that suits personal needs and habits.

  1. Specify the way rewards for traveling accrual. This depends on traveling habits. Provided a customer is loyal to a particular hotel or airline then a branded card can be of the most appropriate variant. In case a client prefers keeping options open then the best choice is a credit card providing rewards programs with several ways to redeem points.
  2. Compare the amount of points that can be earned with different cards. Rewarding is one of the key factors to be examined when choosing a credit card that gives rewards for traveling. Budget should be considered during calculating the possible amount of points to be received per month. It's also important to pay attention to registration bonuses as they can provide significant initial value.
  3. Check annual charges and benefits of various card. These two factors also interconnected as a lot of best travel cards have higher annual charged together with more valuable benefits. Customers just need to check properly which card allows the best benefits compared to annual payments. Provided an appropriate option has not been found it's worth thinking of a free of charge credit card holding.

The best options of credit cards for traveling

  • American Express®. The American Express® Membership Rewards program provides the most extensive list of airlines and partner hotels among any other issuers which makes it great for points transferring. Holding this bonus credit card enables to use rewards of a flat rate that equals to $0.01 for 1 point for certain travel purchases types via American Express®.
  • Chase®. The program of Chase® Ultimate Rewards has over a dozen travel partners including major domestic as well as international airlines and popular hotel chains. But the main advantage is the possibility to exchange points via the Chase® travel portal at a rate of $ 0.0125 or $ 0.015 for 1 point, regarding the type of Chase® credit card held. This feature makes this program one of the most worthful.
  • Citi®. Similar to the abovementioned programs, points got through Citi® ThankYou Rewards can be redeemed either with travel partners or through the travel portal at a rate of $0.01 for 1 point. The list of travel partners is not very impressive and consists of several major domestic airlines.

Comparing traveling credit cards' offers

Finding the best card for travel depends to a large extent on coming across a credit card issuer that provides rewarding programs which suit you most. Below are some tips how it can be done:

  1. Review information about travel partners of the card issuer. You are able to get the most benefit when converting travel points to airlines or hotels reward booking. Transferring rates can appear to be over $ 0.03 for 1 point that is much more that would be received for flat rate redeeming. As each card's rewarding program has its own travel partners you should search services of airlines or hotels you regularly use to ease points exchanging.
  2. Check out travel points' value in cash. It is not always possible to find good travel deals that can be booked by converting points. In this case buyout with a fixed rate seems to be a good backup plan. Ideally, rewards should be redeemed at the least rate of $0.01 for 1 point. The more value a reward program offers, the better.
  3. Learn each company's top offers for credit cards for traveling. Sometimes reward programs are of the same importance as trips themselves. It is better to ensure that the issuer provides an option with the required features for a reasonable per annum fee.

Who needs credit cards for traveling

Mostly cardholders prefer spending not much money on regular traveling as such purchases usually have the highest rates of rewarding. But taking advantage of such cards doesn't require to be a frequent traveler. Moreover, a number of cards give great reward rates for regular purchases as well. Provided a customer does not travel regularly then the best deal is Capital One® Venture Rewards Card which grants double miles for every dollar.

Credit cards for every traveler exist. Once distinguishing better between the types of travelers, customers are able to find cards suitable for their personal needs and habits.

Credit cards for traveling are proper for:

Newbie travelers

Provided a customer is newbie in traveling, starting with a card that offers simple yet flexible rewards can be the best choice. Considering all the ins and outs of miles and points, a complex reward structure and redemption process are the least comfortable.

Brand followers

Some people prefer using the same airline service or staying at the same brand hotel whenever it's possible. Brand credit cards seem to be the most appropriate option for such travelers. Brand tied card purchases and other loyalty benefits are mostly used as specific brand's bonuses.

Business travelers

Business cards are among the most appropriate credit cards for traveling. Whether a holder is a freelancer or a big company CEO a proper credit card rewarding travels can help enjoy daily business purchases rewards and simultaneously organize business and personal expenses.

International travelers

When frequently traveling abroad for pleasure or business, customers should consider having a card that does not charge overseas transaction fees. For skipping lines at airport security or customs there are travel cards providing check-in refunds like Capital One® Venture, Global Entry or TSA PreCheck and others.

Luxury travelers

Top level credit cards for traveling can provide truly luxurious journeys. Thus, the Chase® Sapphire Reserve has a wide range of benefits on offer while the Platinum Card from American Express® affords access to Centurion lounges. Despite higher tier cards' charge per annum fees, these costs can be offset by taking full advantage of insuring trips, travel loans as well as other benefits.

Arguments for and against obtaining credit cards that provide rewards for traveling

Why such cards are worth holding.

  • Registration bonus allows great traveling benefits. The best cards typically offer a bonus of $500 or more. In many cases this is enough for purchasing a round trip.
  • Perks make travels less expensive and more relaxing. Cardholders don't have to worry about stuffing carry-on bags in full as travel cards allow free checked-in baggage and usually refund luggage cost. Additionally, these cards allow to access to airport lounges as well as primary insurance for rental cars.
  • Every purchase brings the next trip closer thanks to rewards. Everyday expenses can become more pleasant when for every $1,000 spent you get $10 or $20 on a future vacation.
  • Double dipping. Allows more points for travel purchases. Buying a plane ticket or booking a hotel room a cardholder is able to earn miles or loyalty points irrespective of a payment method. But with suitable credit cards customers can get even more points and miles.
  • Absence of overseas transaction fees can result is significant savings. Taking a regular credit card while traveling outside the US can lead that for $1,000 purchases commissions of about $30 can be charged for overseas transactions. Good cards do not require such fee.
  • Strategic bonuses can increase value. As for refundable credit cards 1 cent equals to 1 cent while most travel rewarding credit cards' points and miles have a variable value depending on the way of redeeming, whether using a card to pay for travels or transferring rewards to partners, booking domestic and international flights, economy or business class, budget hotels stay or elite resorts.

Reasons why travel rewarding credit cards can be unsuitable.

  • The most beneficial cards charge per annum fees. In many cases, rewards received with a credit card are able to offset its per annum fee. But some holders are strictly opposite to cover such payments under any circumstances. Such clients actually can face the situation when options for travel cards are severely limited and they are not able receive benefits provided by most valuable cards.
  • Traveling credit cards can be unsuitable for infrequent travelers. The first year of a travel card utilizing will probably be beneficial as a customer can receive a big registration bonus and, moreover, some popular options waive an annual charge for the first year as well. However, upcoming years a customer will be recouped with this commission by using the card frequently enough to offset it (thanks to rewards earned and redeemed as well as perks used). Infrequent travelers are more likely to gain more with refund cards with no per annum fees.
  • Spending requirements for getting a registration bonus can be demanding. A bonus of $500, $600 or $700 seems to be attractive but only if a client can afford to earn it with the costs that would be done anyway. This kind may be not the best one provided a cardholder doesn't want to accumulate thousands of dollars in debt and repay interest on it afterwards.
  • Bonus cards generally charge higher rates of interest. Provided the balance is carried from month to month, any credit cards with bonuses inclusive travel ones are probably not the best choice because percentage to be paid mitigates the rewards value. In this case, a low interest card that reduces the cost of keeping balance seems to be a batter option.
  • Cashback is easier and more flexible. Some issuers of credit cards afford to redeem rewards for travel only while others don't appreciate if clients do not spent money for trips. Still others have complex redemption options that sophisticate taking advantage of rewards. With refundable credit cards clients can apply their rewards for anything, they know exactly the rewards' value and redemption scheme is usually simple.
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