Travel credit cards can help you earn rewards on everyday purchases and redeem those rewards for travel expenses like flights and hotels—but which travel credit card is right for you? There are many travel credit cards out there, from no-annual-fee cards that offer basic rewards to premium travel cards that come with luxury-level perks. How do you choose which card to use, and how do you weigh the costs and benefits of all the potential options?
Sounds like it’s time for Travel Card 101. Traveling credit cards are designed for every kind of traveler, whether you’re a frequent flyer or whether you’re simply hoping to save up points for your next vacation. That’s why you need to know how to choose the right travel card for your travel needs—and once you know how travel credit cards work, you’ll be better prepared to get the most out of your travel credit card rewards.
Travel card 101
If you do a lot of traveling, credit cards can help you earn rewards on every trip you take. The best travel credit cards offer perks like travel insurance, airport lounge access and TSA Precheck or Global Entry membership credits.
Most travel credit cards offer at least 1 point or mile per dollar on every purchase. Your point/mile value often increases if you make purchases related to travel, such as flights, hotels, rideshares and more. The Chase Sapphire Preferred® Card, for example, currently offers 2x points on travel and dining, 5x points on Lyft rides through March 2022 and 1 point on all other purchases.
Most travel credit cards also give you the opportunity to book travel through your credit card issuer’s online portal instead of booking directly with an airline or hotel. Sometimes booking travel through your credit card issuer will increase the value of your points. For example, when you use your Chase Sapphire Preferred points to book travel through Chase Ultimate Rewards, your point value increases by 25 percent.
How do travel credit cards work?
How do travel reward credit cards work? In general, travel rewards cards work like other types of rewards credit cards—as you make purchases, your card rewards you with a certain amount of points or miles per dollar spent. Your points and miles may increase depending on what types of purchases you’re making, or you may earn the same rewards on every purchase category. The Capital One VentureOne Rewards Credit Card, for example, offers a flat 1.25 miles per dollar on all purchases.
The best travel credit cards also include sign-up bonuses that increase the value of your rewards. The Capital One VentureOne Rewards card currently offers 20,000 bonus miles if you spend $500 in the first three months—and those miles can be worth $200 when redeemed for travel through Capital One.
Of course, you don’t have to redeem your travel rewards on travel purchases. Like most rewards credit cards, travel credit cards give you the option to put your rewards towards online shopping, gift cards, cash back, statement credits and more. In some cases, the value of your points or miles may increase or decrease depending on how they are redeemed. That’s why it’s always a good idea to read the fine print before redeeming your rewards!
Top travel credit cards also offer travel-friendly perks, whether it’s the ability to transfer your rewards to your favorite airline or hotel loyalty program or the option to earn a statement credit for your TSA Precheck membership. In general, the travel credit cards with the best travel perks also come with the highest annual fees. So before you sign up for a travel credit card, ask yourself whether the benefits are worth the annual cost for you.
Which travel credit card is best for me?
There are many travel credit cards out there—but which travel card is best for you? Here are two ways to narrow down your options:
Airline credit card vs. travel credit card
If you are a frequent flyer, it’s important to decide whether you want a travel credit card or an airline credit card. The best airline credit cards are designed to reward people who regularly fly a specific airline—Delta, United, American, Southwest, JetBlue and so on—and often include perks like airline statement credits, discounts on in-flight purchases and companion passes.
In most cases, you’ll maximize your airline credit card rewards by combining your airline card with your chosen airline’s frequent flyer loyalty program. If you don’t want to join an airline loyalty program—or if you fly too many different airlines to be loyal to just one—you might be better off with an all-purpose travel credit card instead.
Annual fee vs. no annual fee
Some travel credit cards come with annual fees, and some don’t. Which should you choose? It all depends on whether you think you’ll be able to get more value out of your card than the cost of the annual fee.
Want an example of how this works? Let’s compare two popular Capital One travel cards.
The Capital One VentureOne Rewards Credit Card has no annual fee, and cardholders earn 1.25 miles per dollar on purchases as well as 20,000 bonus miles after spending $500 in the first three months.
The Capital One Venture Rewards Credit Card, on the other hand, has a $95 annual fee — and cardholders earn 2 miles per dollar on all purchases as well as the ability to earn 100,000 bonus miles when you spend $20,000 on purchases in the first 12 months from account opening, or still earn 50,000 miles if you spend $3,000 on purchases in the first 3 months. Plus, cardholders get a TSA Precheck or Global Entry membership credit worth up to $100.
Which card is right for you? If you don’t see yourself putting at least $3,000 on a credit card in the first three months of card ownership, you might be better off with the no-annual-fee VentureOne card. On the other hand, if you’d easily hit that spend, the Venture card might be worth the $95 annual fee. After all, those 50,000 bonus miles from the lower welcome offer can be worth $500 when redeemed for travel through Capital One.
Should you get a premium travel credit card?
If you spend a lot of money on travel every year, you might want to consider a premium travel credit card. These credit cards come with extremely high annual fees and are often only available to people with excellent credit—but these cards also come with a luxurious amount of perks and benefits.
Three of the most popular premium travel credit cards on the market are the Chase Sapphire Reserve®, The Platinum Card® from American Express and the Citi Prestige® Card. While these cards have annual fees of $550, $550 and $495 respectively, they also come with perks like annual travel credits, complimentary airport lounge access and hotel benefits. If that sounds like something you could take full advantage of, a premium travel credit card could be right for you, as long as you can afford the annual fee.
The bottom line
Once you understand travel credit card 101, it’s a lot easier to answer the question, “which travel credit card is best for me?” Whether you want a no-annual-fee card that rewards travel purchases or a premium credit card that offers airport lounge access and annual travel credits, the odds are that there’s a travel credit card that’s right for you. Knowing how to choose the right travel card will help you get the most out of your travel rewards.