What to Look For in a Travel Rewards Credit Card

It’s no secret that travel rewards cards are the most-appealing credit card options available to consumers today. And why shouldn’t they be? Free miles simply for making the purchases you’re already planning on making; where else can you get a deal like that?

Travel rewards credit cards

That said, not every travel rewards card is created equal, and not every travel rewards credit card is right for everyone. When researching and applying for a travel rewards cards, there are a few things consumers need to consider.

Here are some things to ask yourself when choosing the best travel rewards card for you…

1) Am I loyal to one brand?

The only way to become Mr. or Mrs. VIP on an airline of your choice is to apply for and receive a co-branded airline miles credit card. There are pros and cons to signing up for an airline-branded credit card, so it’s best to break them down one by one…

The biggest pro to co-branded airline miles credit cards is preferred access; boarding privileges and flight discounts with your favorite airline could save you time at the gate and make you’re travel experiences slightly more hassle-free. Other perks can include double miles on airline purchases, cheaper pricing on in-flight purchases and – the almighty perk – access to your favorite airline’s VIP airport lounges. Not a bad way to travel, right?

Hey, nothing’s perfect. Even co-branded airline miles cards have their restrictions. Of course, these cards are for one airline (or family of airlines) only. If you’ve never been partial to one airline over another, then you’re less likely to be impressed by the VIP perks offered by a co-branded airline miles card. If flight flexibility is more your thing, then you might feel weighed down by the restrictions of booking with one airline only.

So before you apply for a card ask yourself if you’re ready to commit to one airline. We know that commitment can be scary, so make sure it’s an airline you love before applying for a co-branded airline miles credit card.

2) What kind of credit card sign-up bonus is available?

Credit cards for travel offer the most lucrative sign-up bonuses of any category of cards available on the market today. This is often their main incentive for attracting new members, though many consumers opt out of their new airlines miles card upon receiving their bonus miles or points. (This is NOT recommended, by the way.)

Popular airline credit cards like the Chase Sapphire Preferred® Card offer members 40,000 miles when they spend $3,000 in the first three months of their account opening. That’s the equivalent of $500 in travel, and the Chase Ultimate Rewards® program includes up to 20% off travel purchases, making this an especially lucrative way to make travel plans.

But before signing off on that shiny new airline miles credit card, make sure that the sign-up bonus offered by that credit card is realistic for your budget. For instance, if you only make $150 in purchases on your credit card in a given month, then maybe the aforementioned Chase card isn’t quite right for you. And when it comes to rewards points and miles, going over-budget to chase down points can lead to high interest fees on your upcoming credit card bill.

The last thing to ask yourself when choosing the right airline miles card for you is…

3) Am I a domestic traveler, or do I plan on flying abroad?

One of the dirty little secrets about using your credit card abroad is that you could be charged a boatload in foreign transaction fees. Many credit cards that don’t specialize in travel charge a 3% fee (or more) on transactions made outside of the United States. For a tourist spending a week or more abroad, 3% can really add up, and suddenly you return home to find a credit card bill that’s that much higher than you originally anticipated.

So, one last thing you need to ask yourself before applying for a credit cards with travel rewards is, “Am I planning on traveling abroad?” Or, better yet: “Do I have dreams of traveling abroad?”

If the answer is ‘Yes’, then make whether or not a credit card charges foreign transaction fees your last factor in applying for, receiving and using your travel rewards card.

This guest post was written by Jason Bushey Jason is a full timer personal finance blogger and the Editor of Creditnet.com.

SB’s Opinion – Always use credit card responsibly. Pay entire due by the due date. Else, the fees and interest charges would far outweigh the rewards, if any. With my experience, I don’t go for cards with high sign-up bonus and fewer miles conversion. At this moment I do not own any travel rewards card. All my cards are of cash-back category.

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  1. says

    I am far from a loyal credit card user. I’m all about a big bonus and it hardly matters who it’s from. I do a lot of travel so the more rewards I can accumulate the better. Of course you need to balance it out with your credit rating but it’s worth the effort to keep track of it all.

    I think #3 is a very important point, but luckily you only need one or two cards for travel purposes and you can spread the domestic stuff out if you’re going for rewards. I did get caught with some travel fees once and I certainly learned my lesson. Hopefully you save some others from that nasty surprise.

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