Why Should You Use a Travel Credit Card?
Travel credit cards are one of the most popular types of credit cards and for good reason. Travel cards offer reward points on everyday purchases that can pay for your next vacation. These cards are well known for offering substantial welcome bonuses that often cover the cost of vacation flights or extended hotel stays.
Travel cards go beyond rewards points to offer cardholders perks to help make their vacations easier. Notable benefits include TSA PreCheck and access to priority lounges to make your airport experience more pleasurable before flight.
For the international travelers, many of these cards offer no foreign transaction fees which is typically 3% of each purchase made abroad. You won’t need to worry about using your card internationally as these cards have partnered with the best international networks - like Visa and Mastercard - to ensure you can use your card effortlessly anywhere.
There are plenty of variations of travel rewards credit cards. Finding the best card for your will depend on what kind of traveler you are. Consider how often you fly, if you are planning on going internationally, and if you tend to pay for premium travel experience.
If you don’t want to manually analyze your spending yourself, you can sign up for a free Clyde account. Clyde’s AI estimates the rewards value you are likely to receive in the first year after account opening for each card. Clyde uses your opt-in transaction data securely shared via Plaid (also used by Venmo) to personalize your credit card recommendations based on your spending. You can compare cards quantitatively by their value to you and take the guesswork out of finding the best card for you.
Co-branded Travel Cards
Airline cards are a popular credit card offering for frequent travelers. The primary difference between an airline card and a travel rewards card is earning and redeeming points. Airlines cards offer frequent flier miles that are typically redeemable only with a single partnered airline. Travel rewards credit cards, however, are usually redeemable with not only any airline but also many hotel and resort brands.
One of the main benefits of an airline branded card is in-flight benefits. Usually these cards will come with complimentary priority boarding, free entertainment, and refreshments to make your time in air more enjoyable. These benefits make most sense if you are loyal to a particular airline. For example, if you live in a city that is a major hub for a particular airline then it might make more sense to open one of their cards. The downside of airline cards is you will have more limited redemption options than a travel regards card because you will only be able to use your frequent flier miles with that specific carrier.
Travel rewards are becoming easier to redeem for a variety of different travel benefits. For most bank offerings, you can redeem your points for hotel stays, flights, and even cash equivalents. This has made opening a travel rewards card make more sense than ever. Keep an eye out for promotional welcome bonuses as well which can pay for your next vacation or cover an annual fee for multiple years. If you’re confused about what a mile or rewards points means, typically these are converted on a 1-to-1 basis with one cent. In other words, a 60,000 miles welcome bonus is the equivalent of $600 when redeemed. One note to keep in mind is that some travel rewards do expire so it’s important to use your rewards while they are still active.
Some travel cards come with annual fees while others don’t. Making sense of which travel card is the best fit for you comes down to understanding your spending habits. Just because a card comes with an annual fee doesn’t mean the rewards won’t offset it or that it could be your best option.
The simplest way to understand which card will be most rewarding to you is to make a free Clyde account, where the AI does all the value estimations for you using your own spending data.