How to choose a travel credit card
The "best" travel card is the one whose value you will actually use. Here's how to do the math in five minutes, before you look at a single offer.
Step 1: Do the annual-fee math
Write down only the credits and perks you would have paid for anyway. If those are worth more than the annual fee, the card pays for itself. If you have to change your habits to use a credit, count it at half value or zero.
| Card type | Typical annual fee | Best for |
|---|---|---|
| No-fee travel card | $0 | Occasional travelers who want no foreign transaction fees. |
| Mid-tier points card | About $95 to $150 | Most people: solid earning, transferable points, some trip protections. |
| Premium card | About $395 to $895 | Frequent flyers who use lounges and the travel credits every year. |
| Airline / hotel co-brand | $0 to $650 | Loyal to one airline or hotel; perks like free checked bags or free nights. |
Step 2: Transferable points vs. airline miles
Transferable points (bank programs) can move to several airline and hotel partners, so you aren't stuck if one airline raises award prices. Co-brand cards earn one program's currency but often give perks like a free checked bag that can be worth more than the points for families.
Step 3: Never pay foreign transaction fees
Many standard cards charge around 3% on purchases abroad. Most travel cards charge 0%. When a card terminal abroad asks whether to pay in dollars or local currency, choose local currency. "Dynamic currency conversion" usually has a worse exchange rate.
Step 4: Check the built-in travel insurance
Many travel cards include protections when you pay for the trip with the card. Typical benefits:
- Trip delay reimbursement: meals and hotel after a delay beyond a set number of hours.
- Trip cancellation/interruption: covers prepaid costs for covered reasons, up to a limit.
- Rental car collision coverage: primary on some cards, secondary on others (see our rental car insurance guide).
- Baggage delay/loss.
Card coverage usually does not include emergency medical abroad, which is why many travelers still buy a medical travel policy.
Step 5: Protect your credit score
Each application is usually a hard inquiry. Space out applications, watch issuer rules on how many new cards you can open, and keep utilization low.
FAQ
Are travel credit cards worth the annual fee?
Only if the credits and perks you'd use anyway are worth more than the fee. Count only value you'd actually use.
What is a foreign transaction fee?
A surcharge, often around 3%, that some cards add to purchases made abroad or in foreign currency. Most travel cards have none.
Does my credit card include travel insurance?
Many travel cards include trip delay, cancellation and rental car coverage when you pay with the card, but usually not emergency medical. Check your card's guide to benefits.
Should I pay in local currency or dollars abroad?
Usually local currency. Paying in dollars triggers dynamic currency conversion, which typically uses a worse rate.