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How to Choose a Travel Credit Card

Airline Credit Cards, Credit Cards, Rewards Credit Cards
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How to Choose a Travel Credit Card

A good travel card earns you free trips, covers travel-related emergencies and doesn’t charge you fees overseas. But finding a card that offers all of these perks can be challenging. If you know what to look for, though, you can sort through the array of travel credit card offerings to find one that best suits your lifestyle.

Aim for high rewards and a signup bonus

While we can appreciate the credit-building aspects of credit cards, we really love plastic for the rewards. Credit card rewards are available on many credit cards due to interchange fees. As a general rule, you can expect to see rewards of 1 to 2% of your purchases on competitive travel cards.

Many good travel cards offer a signup bonus as a perk, and most bonuses work like this: If you spend a certain amount of money within a specified time period, you’ll get an influx of points or miles. A good signup bonus could mean at least one free flight for your next trip.

MORE>> How to Pick the Best Credit Card for You: 4 Easy Steps

What to look for in a travel card: It’s important to consider how rewards are earned and how they’re redeemed. You should choose a credit card that allows you to earn high rewards on all purchases or extra rewards on travel spending. You should also aim to have a card that allows you to redeem for travel at a high value. As a general rule, you should avoid cards that give you less than 1 cent per point or mile when you redeem. Check out our rewards program reviews for the points value on different redemption options.

Signup bonuses aren’t quite as important as ongoing rewards — especially if you plan on keeping your card long term — but they are a nice perk. Compare our top credit cards for signup bonuses. But before you sign up, ensure that you can reasonably spend the amount required to earn the bonus within the given time frame.

Get the travel perks and protections you need

There are some credit card perks and protections that come in handy as you travel. For example, some credit card networks offer rental car coverage, lost luggage insurance, travel delay and accident insurance, concierge services and emergency assistance. Many cards — especially co-branded airline and hotel cards — have perks such as free checked bags, priority boarding, discounts and various travel-related credits.

What to look for in a travel card: Decide which perks and protections are non-negotiables for you and ensure the card you choose has these features. For instance, if you regularly check bags with expensive items, you may want lost baggage protection. If you rent cars frequently, you’ll want a card with good rental car coverage. For these protections and more, check out these top credit cards for travel protection.

Those who want perks and frequently fly on a specific airline may look into a co-branded travel card. However, you should know that co-branded cards typically earn less on non-travel purchases than general travel credit cards. So if you fly with your favorite airline carrier on a semi-regular basis, limit yourself to just one co-branded card.

Consider EMV chips and international acceptance

EMV chips keep your transactions more secure than magstripes, both in the United States and abroad, but they aren’t widely used by most merchants in the States yet. That said, many international merchants only accept cards with EMV technology, so if you travel overseas at all, it’s a good idea to have a chipped card.

Speaking of international purchases, you should keep in mind that some payment networks aren’t accepted widely overseas. For instance, a Visa or MasterCard will probably be accepted at more places than a Discover or American Express card.

What to look for in a travel card: In October 2015, a liability shift will put the costs of fraud on issuers that don’t issue EMV cards and merchants that don’t accept them. We can hope that most issuers will then upgrade their cards to EMV. In the meantime, if you’re getting a new card, pick one with EMV technology.

If you plan to travel overseas in the foreseeable future, you’ll want at least one card that’s widely accepted at your destination. In most cases, this will mean having a Visa or MasterCard.

Foreign transaction fees

Many cards charge foreign transaction fees of roughly 3% of every purchase made outside the United States or with foreign e-tailers.

What to look for in a travel card: If you ever spend money on international purchases — either when you travel overseas or online — you should have a card that doesn’t charge you for the privilege. Here are our top cards without foreign transaction fees.

The bottom line 

When you’re choosing a travel credit card, pay attention to rewards, perks, EMV capability and foreign transaction fees. To help you get started, check out the Nerds’ favorite travel credit cards. Alternatively, check out all of the travel credit cards in our database to choose the card that’s best for your needs.

Erin El Issa is a staff writer covering personal finance for NerdWallet. Follow her on Twitter @Erin_Lindsay17 and on Google+.


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