Credit cards make travel abroad simpler by eliminating cumbersome currency exchanges and foreign transaction fees, plus providing comprehensive travel protections that protect against things such as lost luggage or unauthorized purchases.
Look for a credit card with an attractive sign-up bonus worth more than its annual fee and waives foreign transaction fees, and also one which rewards you in categories of your choosing.
1. No foreign transaction fees
Before leaving for an international trip, the best travel credit cards offer no foreign transaction fees and often provide other advantages like coverage for lost/damaged luggage, trip interruption/cancellation fees and rental car damage claims.
Foreign transaction fees are an all too familiar feature of credit card usage and can quickly eat away at rewards earnings. A card without these fees could save you up to 3% or more per purchase made while traveling.
Some credit cards offer cash advance and ATM fees when used overseas, making them an attractive choice when traveling. NerdWallet allows you to compare options on this front so that you can select one with the most attractive combination of features. It is recommended that you apply for such cards well ahead of your trip in order to receive credit/debit card approval in time and obtain it by mail in time to use during your travels abroad – some cards require credit checks which could take several weeks!
2. Travel protections
When using your card during holiday spending, make sure it has chip technology enabled to prevent fraud. Chip cards offer superior security compared to their magnetic stripe counterparts as they make it more difficult for thieves to copy your information and compromise your personal details.
Credit card companies take precautions against fraudulent activity with safety features designed to safeguard your account, so putting charges thousands of miles from home could raise alarm bells and lead to the freezing of your account – so it is wiser to notify your card issuer prior to traveling if this is your plan.
Many travel cards provide travel protections such as trip cancellation and lost luggage coverage; it’s essential to compare coverage limits. Supplementary policies may be worth the cost if you desire greater coverage, while carrying multiple types of card (Visa and Mastercard are often accepted, while American Express or Discover may not).
3. Reward programs
Travel credit cards provide a range of rewards programs. Some cards, like Capital One SavorOne Student Cash Rewards Card, allow users to reap the benefits of loyalty programs offered by airlines or hotels and earn free stays or room upgrades as rewards; others allow cashback on every purchase and redeem it for statement credits, merchandise or travel.
Consider your daily spending habits and desired rewards program when selecting a credit card. Do you prefer an easy earnings structure such as flat-rate points earning model or would you rather take advantage of travel rewards programs which allow redemption for airfare, hotel rooms or rental cars?
Premium travel credit cards typically charge higher annual fees, but can come with additional perks such as airport lounge access, airline or hotel upgrades and fee credits for TSA PreCheck and other trusted traveler programs. NerdWallet’s ratings take into account coverage options, customer experience, customizability and cost to give a clear picture of which cards make sense for travel abroad.
4. International acceptance
Credit cards with strong international acceptance can help save you money when traveling overseas. Opt for one from Visa or Mastercard that offers global acceptance, avoids dynamic currency conversion and provides travel protections such as car rental insurance, trip cancellation coverage and lost luggage reimbursement.
Credit cards with chip-enabled terminals work better when traveling abroad, as merchants in destinations that have yet to embrace chip technology may accept these credit cards more readily, while they also deter would-be thieves by not permitting traditional swipe methods on them.
Certain credit cards boast higher international acceptance than others, with Visa and Mastercard offering the highest rates, followed by Discover and American Express. Some cards also provide rewards tailored to international spending – for instance dining-specific bonus categories on some cards. NerdWallet selects its top credit cards for travel abroad based on overall consumer value criteria including annual fees, foreign transaction fees, rewards earnings rates and more.
