Travel credit cards can be advantageous for consumers who purchase travel frequently and can meet minimum spending requirements to unlock bonuses. Furthermore, these credit cards can benefit those who can pay off balances monthly without incurring penalties.
These cards provide travelers with airline miles, hotel points or flexible bank point currencies – and may even waive foreign transaction fees.
Getting a Travel Credit Card
Travel credit cards can help you save money on airfare, hotel stays and more by earning rewards like airline miles or points. Before selecting one though, it’s important to evaluate your spending habits and travel goals to find an appropriate card.
Many travel cards offer sign-up bonuses of thousands of miles upon signing up, though meeting minimum spending requirements in your first few months may be required for you to qualify for them.
If you already have credit card debt, a travel rewards card might not be worthwhile as its high interest payments would cancel out its benefits. Instead, consider opting for a low-interest card to save money by eliminating balance carrying costs.
Airline and general travel cards typically require excellent credit, usually defined by having at least a FICO(r) Score of 670 or above. You can check your score with Experian free of charge to see where you stand before applying, plus whether joining any airline/hotel loyalty programs would make the annual fees worthwhile.
Rewards
Travel credit cards typically offer rewards in the form of points or miles that can be redeemed for free travel, while some cards also provide other features, such as annual credits to cover airline incidentals like checked bags and purchases or airport lounge access; these extra features can help offset an annual fee on your card.
Before applying for a travel credit card, take an honest assessment of how often and how frequently you travel as well as whether the rewards will outweigh its annual fee. Also assess if you meet all requirements of any welcome bonuses or sign-up offers that might come your way; if not using its features sufficiently or redeeming points at sufficient value then perhaps another type of rewards card might be better suited to you instead. Note that travel cards usually require good to excellent credit scores for approval so make sure all finances are in order before applying – check your own score with Experian for free here!
Requirements
Travel credit cards provide points or miles that can be redeemed for free airfare, hotel stays and more. While their annual fees may be high, their benefits could justify it; just make sure you use it wisely so as not to incur interest payments or rack up debt.
You will require excellent or good credit in order to qualify for most travel rewards credit cards, and other factors like income, debt-to-income ratio (DTI), and how many cards issued by the issuer could influence whether or not you get approved.
Before applying for a travel credit card, make sure that your credit score meets at least 670. Experian offers this free service; alternatively, use Discover Card’s preapproval tool to assess whether or not you will be approved before applying – the tool runs a soft inquiry on your report that won’t have an adverse impact on your score.
Fees
As with regular credit cards, travel credit cards come with their own set of fees. Most charge an annual fee that may be waived the first year but must then be paid annually thereafter. Some cards also impose foreign transaction fees of roughly 3% of each purchase made abroad.
As a way of offsetting these costs, many cards offer generous welcome bonuses that allow new cardholders to quickly build up their points and miles balance. Furthermore, some co-branded cards enable you to earn rewards within specific airlines or hotels’ loyalty programs.
Before choosing a travel credit card, carefully consider its purpose and if its rewards can meet your needs. If they won’t, paying an annual fee might not make sense; as well as reviewing your spending habits to ensure they can meet any minimum spending requirements associated with welcome offers.
