What makes a travel card worth using
A travel credit card gives you rewards on flights, hotels, and dining—usually as points or miles you can redeem for trips. The best ones waive foreign transaction fees (the 2–3% charge most cards add when you spend abroad), offer travel insurance that covers trip delays or lost luggage, and let you earn bonus points in your first few months. Some cards also give you lounge access at airports or statement credits for specific travel expenses.
The card that works best for you depends on where you travel, how often, and whether you want to chase points aggressively or straightforward earn them as you spend. A card that rewards airline purchases heavily might not help if you book hotels more often. A premium card with a $500 annual fee makes sense only if you travel enough to recoup that cost in benefits and rewards.
Before you open a new card, check your current credit score. Most travel cards require a score of 670 or higher, and the best ones ask for 740+. If your score is lower, you may not be approved, or you may get a higher interest rate.
Key Takeaways
- Travel cards earn points or miles on flights, hotels, and dining, but the earning rate varies by card and by category—compare what you spend on most.
- Foreign transaction fees run 2–3% on most regular cards; travel cards waive them, saving you money on every purchase abroad.
- Premium travel cards offer perks like lounge access and trip insurance, but only pay for themselves if you travel frequently enough to use those benefits.
- Sign-up bonuses (often 50,000 to 100,000 points) can be worth $500–$1,000 in travel value, but you must meet the spending requirement to earn them.
- Your credit score affects approval odds and the interest rate you receive; most travel cards require a score of 670 or higher.
How to compare earning rates and rewards
Travel cards offer rewards in two main forms: points (which you redeem through the card issuer's portal) and miles (which are usually tied to a specific airline or hotel program). Points are more flexible—you can often transfer them to airline partners or use them for any travel booking. Miles lock you into one airline's ecosystem, but frequent flyers on that airline may earn and redeem more efficiently.
Look at the earning rate in categories you actually use. A card that gives 5 points per dollar on flights but only 1 point per dollar on hotels will not help if you stay in hotels more often than you fly. Common earning structures include 2–3 points per dollar on travel purchases, 1–2 points per dollar on dining, and 1 point per dollar on everything else. Some cards offer rotating categories that change each quarter, which requires tracking but can yield higher rewards if you time your spending.
The sign-up bonus is often the largest single reward you will earn. A card offering 75,000 points after you spend $5,000 in three months might be worth $750–$1,000 in travel value, depending on how you redeem. But you only get it if you meet the spending requirement. If you cannot spend $5,000 in three months without going into debt, choose a card with a lower bonus or no bonus at all.
Check the redemption value before you open the card. Some programs value points at 1 cent each; others at 1.5 cents or higher. A card with a lower earning rate but higher redemption value may beat one with a higher earning rate but lower value per point.
Annual fees and when they make sense
Travel cards fall into two groups: no-annual-fee cards and premium cards with fees ranging from $95 to $550 per year. A no-annual-fee card is a good starting point if you travel occasionally or want to test whether you will use the rewards. Premium cards offer more perks—higher earning rates, travel insurance, lounge access, statement credits—but only justify their cost if you use those benefits.
To decide whether a premium card pays for itself, add up the value of its benefits. A $95 annual fee card that gives you a $100 airline fee credit and $50 in other perks has already paid for itself before you earn a single point. A $550 card with lounge access (worth $25–$35 per visit) and a $300 annual travel credit makes sense if you visit lounges at least 15 times per year and spend $300 on travel anyway.
Many premium cards waive the first-year fee, so you can test the card without paying. If you do not use the perks in year one, you can close the card before the second annual fee posts. If you do use them, you can decide whether the benefits justify keeping it.
Foreign transaction fees and currency conversion
When you use a regular credit card abroad, the issuer charges a foreign transaction fee of 2–3% on top of the purchase price. On a $1,000 hotel bill, that is $20–$30 in extra cost. Travel cards waive this fee entirely, saving you money on every purchase outside the United States.
Currency conversion is separate from the foreign transaction fee. When you spend in a foreign currency, the card network (Visa, Mastercard, American Express) converts it to dollars at their exchange rate, which is usually close to the market rate. You cannot avoid this conversion, but you can avoid the foreign transaction fee by using a travel card. Some premium travel cards also offer slightly better exchange rates, though the difference is usually small.
Avoid using ATMs abroad with a regular card—the foreign transaction fee applies to cash withdrawals too, and the ATM operator may charge an additional fee. If you need cash, use a travel card that waives foreign transaction fees, or look for a checking account with a no-fee ATM network abroad (some online banks offer this).
Travel insurance and other card protections
Premium travel cards include insurance that covers trip delays, trip cancellations, lost luggage, and emergency medical care abroad. These protections are secondary to your travel insurance or health insurance, meaning they pay only after your primary coverage pays. But they fill gaps and cost you nothing extra.
Trip delay reimbursement covers meals and lodging if your flight is delayed more than 12 hours (the threshold varies by card). Trip cancellation insurance reimburses prepaid, non-refundable trip costs if you cancel for a covered reason—illness, injury, or death of a family member. Lost luggage reimbursement covers the cost of baggage and personal items if an airline loses your bag. Emergency medical and dental covers urgent care abroad up to a set limit, usually $250,000.
Read the fine print before you travel. Insurance has exclusions—pre-existing conditions, travel to countries under government warnings, and claims filed after a important date. Some cards require you to charge the entire trip to the card to set up coverage. If you have questions, call the card issuer's travel services line before you leave.
Lounge access and airport perks
Premium travel cards grant access to airport lounges where you can shower, eat, drink, and work in a quiet space while you wait for your flight. The most common lounge networks are Priority Pass (which includes over 1,300 lounges worldwide), American Express Centurion Lounges, and airline-specific lounges like United Club or Delta Sky Club.
Lounge access is valuable if you fly frequently and have long layovers, or if you travel in premium cabin (business or first class). If you fly once or twice a year in economy with short connections, lounge access will not save you money. A single lounge visit costs $25–$35 if you pay out of pocket, so you need at least three or four visits per year to justify a card with a $95+ annual fee based on lounge access alone.
Some cards offer a limited number of free lounge visits per year (often 4–10) and charge for additional visits. Others grant unlimited access. Check whether the card covers a guest (usually a companion traveling with you) or only the cardholder.
How to choose between multiple cards
If you travel frequently, you may benefit from holding more than one travel card. A common strategy is to use one card for flights and airline purchases, another for hotels, and a third for dining and everyday spending. This lets you maximize earning in each category without paying multiple annual fees.
Before you open a second or third card, make sure you can manage the spending requirements for sign-up bonuses. If you open three cards and each requires $5,000 in spending within three months, you need to spend $15,000 in that window. If you cannot do it without going into debt, open fewer cards or space them out over time.
Opening multiple cards in a short period can lower your credit score temporarily because each process triggers a hard inquiry and lowers your average account age. If your score is already below 740, space applications at least three months apart. If your score is 740 or higher, you can usually open cards closer together without major damage.
Track your cards and their benefits. Set a phone reminder for the annual fee date so you can decide whether to keep or close the card. Many people forget and pay fees on cards they no longer use.
Frequently Asked Questions
Do I need excellent credit to get a travel card?
Most travel cards require a credit score of 670 or higher, and the best ones ask for 740+. If your score is below 670, you may not be approved. If it is between 670 and 740, you may be approved but at a higher interest rate. Check your score before you explore; you can get a free report once per year at annualcreditreport.com.
What is the difference between points and miles?
Points are issued by the card company and can usually be transferred to airline or hotel partners or redeemed for any travel booking. Miles are issued by an airline or hotel program and can only be used within that program. Points are more flexible; miles can be more valuable if you fly one airline frequently.
Can I earn rewards on a travel card if I do not travel?
Yes. Most travel cards earn 1 point per dollar on all purchases, even if you never leave home. But you will earn fewer rewards than someone who travels frequently, so a no-annual-fee card may be a better choice for you.
Should I close a travel card after the first year?
Not necessarily. If the annual fee is waived in year one and you used the card's benefits, you can decide in month 11 whether to keep it. If you will use the perks again, keep it. If not, close it before the second annual fee posts. Closing a card does not hurt your score as much as people think, but keeping it open and unused is fine too.
What happens to my points if I close the card?
Your points do not disappear when you close the card. You can still redeem them after the account is closed, though some programs require you to redeem within a set time frame (usually 12 months). Check your card's terms before you close it.