How To Choose a Travel Card

Taking a trip can be less expensive when you're using a travel credit card to book it.

If you're earning points or miles on your stay, you may be able to redeem them as a statement credit against airfare, hotels, and other travel purchases.

Your card may also allow you to use those points or miles to book your next trip—not to mention that some travel cards come with additional perks that can make your trip more comfortable. These perks include complimentary lounge access, hotel upgrades, and travel insurance.

But how do you compare travel credit cards to find the right one? As you're looking for your next travel card, these tips can help you find your ideal match. 

Start With Your Needs

When choosing a travel credit card, it's helpful to think about how you'll use the card and what you need it to do for you.

For instance, some travelers may prioritize earning maximum miles or points on travel. Others may be more interested in scooping up travel perks and benefits like complimentary lounge access or a fee credit toward Global Entry or TSA Precheck (expedited security and customs processes).

Ultimately, your decision should reflect your reasons for getting a travel credit card. Some helpful points to consider include:

• How often you travel or plan to travel
• Where you most often book travel: inside the U.S. vs. outside the U.S.
• Your typical annual spending on travel
• What type of perks or benefits might be most valuable
• Whether you're interested in earning rewards and if so, whether points or miles are preferred 

Co-Branded Travel Rewards Cards

If it's miles you're after, then you might lean toward a co-branded airline credit card. Co-branded credit cards are sponsored by two parties—the credit card issuer and a travel brand, most often an airline or hotel.

If the hotel or airline partner has its own travel loyalty program, you may earn extra points or miles through your loyalty membership. Often, these extra points or miles are added to points or miles you already earn on purchases with your card.

This type of card may be less rewarding for travel if you book at other travel brands or use your card for everyday purchases.

One point to consider when weighing a co-branded card is whether you're loyal to that specific brand or if you often book with competitor hotels or airlines.

General Travel Rewards Cards 

If you tend to book with more than one brand, you may be better off with a general travel rewards credit card that gives you extra points or miles on all travel purchases rather than purchases from a specific airline or hotel.

General travel cards offer the advantage of flexibility. If you’re unsure what your travel needs will be, a general travel rewards card doesn’t pin you down to either air travel or hotel stays.

These cards come in all flavors, from basic, modest travel rewards cards like the Discover it Miles to the premium American Express Platinum offering multiple luxury perks.

Compare Travel Card Features and Benefits

Once you've identified what you need a travel credit card to do for you, think about the specific features and benefits you'd like the card to offer. 

Start With the Rewards Earning Structure

Begin by checking the card's rewards earning structure. Will you earn a flat rate of points—for example, 2 miles for every dollar you spend on the card—or are rewards tiered?

If rewards are tiered, which spending categories offer the most points or miles?

For example, a general travel card may give you 2 points or miles for every dollar you spend on restaurants and travel, and 1 point on everything else.

Hotel rewards cards tend to give the most points for purchases you make through their websites and at their properties. Also, they may have a secondary bonus tier for travel and dining that is higher than the base rewards rate.

Airline cards typically give you one bonus for making purchases with them and a base rate of 1 point per dollar spent on all other purchases you make.

Compare Redemption Options

Next, look at how you can redeem rewards and any restrictions on redemptions. Check for blackout dates (dates on which you can’t book rewards flights or hotel nights) and rules on how you can use your rewards to book.

For instance, some general travel rewards cards offer a rewards bonus when you redeem for travel or redeem through the card's online travel portal. Others allow you to transfer rewards to other travel partners.

If transfers are allowed, check the transfer value first. Some cards transfer points on a 1:1 basis, but not all cards do. It's important to make sure you're not losing any value when redeeming points or miles for travel.

The Chase Sapphire Preferred Card is an example of a card that gives redemption bonuses and lets you transfer points to travel partners.

When you use your points to book travel through the Chase Ultimate Rewards portal, your points get a 25% boost. You can transfer your points to multiple travel partners, too, at a 1:1 rate.

On the other hand, points and miles on hotel and airline cards have the most value when you redeem them for award nights and award flights.

Look for Travel Extras

Next, compare travel credit cards to see what kind of extras are included. Some of the features you may find with a travel card include:

• Introductory rewards bonuses
• Free checked bags
• Complimentary lounge access
• Complimentary hotel upgrades or nights
• Free Wi-Fi access while you travel
• Credits for in-flight purchases
• Fee credits for TSA Precheck or Global Entry

Ideally, the travel card you choose should offer the best combination of rewards and perks that suit your individual travel habits and preferences.

If you're considering a co-branded card, look closely at any additional benefits you might get through the travel partner's loyalty program.

For example, some hotel programs may offer complimentary breakfast and late checkout, when available, for members of the program. 

Compare the Cost

Finally, as you shop around for travel credit cards, take note of the cost you'll pay to have the card.

Start with the annual fee. Consider what you're getting in exchange for what you're paying. A premium travel credit card, for instance, can offer extremely high-value features and benefits, but you may be looking at a more than $500 annual fee to hold one of these cards.

If you're going to pay an annual fee in that range, or any annual fee for that matter, it's important to ensure that what you're getting back from the card balances out the cost to use it.

Then, compare foreign transaction fees. These fees apply to purchases made outside the U.S. While there are many travel credit cards that don't charge this fee, some do. So it's important to be aware of what you'll pay for overseas purchases if you often travel abroad.

Finally, look at the annual percentage rate, or APR, which represents the annual cost of carrying a balance on your card. The higher the APR, the more your purchases will cost if you carry a balance versus paying your bill in full each month.

You should never carry a balance month-to-month on a credit card—it’s expensive. Doing so with a travel rewards card will eliminate any rewards benefit you’ve earned.

The Bottom Line

Choosing the right travel rewards credit card depends on your travel preferences and your daily spending habits.

Try to find the card that gives you the travel perks you can take advantage of. Look for options that give rewards for categories in which you spend money.

And, finally, consider how much the annual fee will cost you. It’s important that you take advantage of enough rewards flights, rewards nights, and perks to make the annual fee worth it.