What is a travel credit card and how to choose the right one
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If you’ve found yourself on this page, you’re probably here to learn about how to earn and redeem travel rewards for free travel. One of the first steps of getting into the miles & points hobby is to apply for a travel credit card. With the right travel cards, you can earn lucrative welcome bonuses and maximize your everyday spending. And get that much closer to making your travel dreams a reality!
But you might be wondering: What makes a travel card different from any other credit card on the market? Here’s what you need to know.
What is a travel credit card
Travel credit cards are cards that offer travel-related perks and rewards that can be redeemed for free travel. They come in many different varieties, like co-branded airline credit cards that earn airline miles and cards that earn transferrable points. The right card for you depends mostly on your spending habits and travel goals.
How to choose the right travel card for you
When deciding between the many fantastic travel rewards credit cards available, having a solid understanding of your financial standing and travel goals is vital. You don’t want to enter into the miles & points hobby without a strategy. Otherwise, you’ll end up either in debt or with a bunch of travel rewards you can’t use.
When comparing cards, consider things like minimum spending requirements (can you meet them?), annual fees and each card’s ongoing earnings rates. Also, consider which type of travel rewards will serve you best when it comes to achieving your travel goals. If flexibility is important, for example, you’ll want to choose a card that earns transferrable rewards.
Here’s our guide to determining what type of travel rewards you should be earning, which will help you narrow down your travel card options.
Best travel credit card for beginners
If you’re new to this hobby, deciding which credit card to get first can be daunting. That’s especially true because many of the best travel credit cards require an excellent credit score and a solid credit history. But don’t worry, as there’s sure to be a card for you.
The credit cards we recommend most to beginners include:
The information for the Chase Freedom has been collected independently by Million Mile Secrets. The card details on this page have not been reviewed or provided by the card issuer.
A card like the Chase Freedom Unlimited is excellent for someone looking to avoid an annual fee while earning travel rewards on everyday purchases. The Citi® Double Cash Card, in comparison, is suitable for someone who wants a hassle-free cash-back earning structure. And the Chase Sapphire Preferred Card is a top pick for those with a great credit score who wish to earn flexible travel rewards.
For a deep dive into the details of these cards, check out our guide to the best cards for beginners.
How to decide if the annual fee is worth it
Whether or not paying an annual fee is worth it comes down to if you can make the most of a card’s perks. Most of the top travel cards have annual fees. And you may be thinking to yourself, “I’d never pay that for a credit card!”
But hear us out. It often makes sense to pay an annual fee for a card that offers valuable benefits.
In deciding if an annual fee is worth it, do the math. If the value you can get from the card’s benefits and perks is greater than the annual fee, keep the card. Otherwise, it’s time to look for a card that’s a better fit for your personal situation.
For example, the ever-popular Chase Sapphire Reserve® has a $550 annual fee. That may seem a bit outrageous at first glance, but it also offers premium perks like:
You can see that the credits alone will easily offset the annual fee. And this isn’t even accounting for the value you can get from the card’s welcome bonus.
The same logic goes for another popular premium rewards card, The Business Platinum Card® from American Express. The annual fee on this card is $595 (see rates & fees). But it is easy to offset the annual fee with the card’s welcome bonus, perks and benefits.
In addition to the 75,000 Amex Membership Rewards points you can earn after spending $15,000 on qualifying purchases within the first three months of account opening, the card also comes with a seemingly never-ending list of perks like:
- Up to $200 in statement credits per calendar year for airline incidentals with your selected airline (luggage fees, in-flight food & drink, etc.)
- Up to $200 in Dell statement credits (for U.S. Dell purchases) per calendar year
- Access to Amex Fine Hotels & Resorts
- Access to airport lounges (Delta, Priority Pass, Airspace, Escape, and American Express Centurion Lounges)
- Access to Amex Offers
- Elite car rental status with Avis, Executive status with National Car Rental, and Gold Plus Rewards with Hertz
- Free Hilton Honors Gold elite status (free breakfast and upgrades when available)
- Free Marriott Bonvoy Gold elite status
- Up to $100 statement credit for Global Entry or TSA PreCheck
- And more!
- Terms & limitations apply
These credits alone offset nearly the entire cost of the card’s annual fee. Here’s a detailed look at why the Amex Business Platinum’s annual fee is worth it.
Again, it comes down to doing the math to see what makes sense for your particular situation.
How to earn travel credit card rewards
The quickest way to rack up loads of travel rewards is by earning lucrative welcome bonuses from the top travel credit cards. The next best way is to make the most of your everyday spending by using a travel card that earns bonus rewards for your purchases.
Take the newly updated Chase Freedom Unlimited, for example. With it you’ll get:
- $200 (20,000 Chase Ultimate Rewards points) after spending $500 on purchases within the first three months of account opening (same as the current Chase Freedom)
- 5% cash back on grocery store purchases (not including Target or Walmart purchases) on up to $12,000 spent in the first year.
And beginning September 15, 2020, you’ll also earn:
- 5% cash back on travel purchased through the Chase Travel Portal (NEW)
- 3% cash back on dining, including takeout and delivery (NEW)
- 3% cash back at drugstores (NEW)
- 1.5% cash back on all other purchases (current benefit)
Those are fantastic earning rates for a card with no annual fee. Plus, it’s hard to beat the 5% back on qualifying grocery purchases — a top spending category for most people.
For a more in-depth look at earning credit card rewards check out our rewards guides here. This page includes posts on:
How to redeem travel credit card rewards
Now comes the fun part! Once you’ve acquired a nice stash of travel rewards, it’s time to redeem them. And the way you redeem your rewards will depend on the type of travel rewards you earned (i.e. miles, points, transferrable rewards or cash back).
For example, if you earn Chase Ultimate Rewards points with a card like the Chase Sapphire Preferred, you can redeem them in a variety of ways, including redeeming them through the Chase Travel Portal or transferring them to one of Chase’s airline or hotel partners.
For a detailed look at how to redeem your travel rewards, take a look at our guides to all things travel rewards here. There you’ll find info likes:
Earning and redeeming travel rewards can be one of the most rewarding hobbies around. With the right travel rewards card(s) and a solid strategy, you can maximize your everyday spending and turn your hard-earned rewards into free travel.
Featured image by Artem Oleshko/Shutterstock.
Chase Sapphire Preferred® CardAPPLY NOW
Chase Sapphire Preferred® Card
Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That’s $1,000 toward travel when you redeem through Chase Ultimate Rewards®.
2X points on travel and dining at restaurants worldwide, eligible delivery services, takeout and dining out & 1 point per dollar spent on all other purchases.
Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 80,000 points are worth $1,000 toward travel.
Get unlimited deliveries with a $0 delivery fee and reduced service fees on orders over $12 for a minimum of one year on qualifying food purchases with DashPass, DoorDash’s subscription service. Activate by 12/31/21.
Earn 5X points on Lyft rides through March 2022. That’s 3X points in addition to the 2X points you already earn on travel.
Either $5 or 5% of the amount of each transfer, whichever is greater.
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