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Are travel credit cards worth it?

Yahoo Personal Finance· Getty Images
Kendall Little
·Senior Writer, Credit Cards
8 min read

It’s no secret that travel credit cards carry some of the most enticing rewards offers available today. Maybe you’ve already seen the potential value yourself — a friend who used a 100,000-point sign-up bonus to fund their international vacation or that targeted card offer in your mailbox boasting multiple free hotel nights each year.

But for many people, travel rewards can also feel overwhelming. With complex rewards structures, high annual fees, and other restrictions, it can be difficult to jump into the world of travel rewards and feel confident you’re making the most of your spending.

Before you open a travel credit card, use this guide to help decide whether travel rewards are right for your spending and lifestyle — and what to look for when comparing new card options.

Travel credit cards work by offering rewards on your spending that help you save on future travel expenses. When you use a travel card to make a purchase, you’ll earn points or miles you can redeem toward future travel.

These cards often have valuable sign-up bonuses but can charge higher annual fees than other rewards credit cards. They’re also less likely than cash-back credit cards to offer an introductory 0% APR and carry very high ongoing APRs.

Learn more: See our picks for the best Chase credit card

Travel cards cover a range of added benefits, including no foreign transaction fees and protections like travel insurance or emergency assistance.

Here are a few more travel credit card features to consider before applying:

Will you earn the highest rewards on travel or everyday spending?

Some travel cards offer the greatest rewards on travel spending. For example, The Platinum Card? from American Express allows cardholders to earn big rewards on certain flight and hotel purchases but only offers 1x points per dollar on everything else. This and similar cards may be best for very frequent travelers who rack up high balances each month on airfare, hotel stays, rental cars, and other travel expenses.

Other travel credit cards offer their best rewards rates on everyday spending. Capital One Venture X Rewards Credit Card earns a flat rewards rate on every purchase you make, and you’ll earn your highest rewards rate on dining out and at U.S. supermarkets with the American Express? Gold Card. Cards like these are likely the better option if you only travel a few times per year. You’ll consistently earn rewards at home on grocery purchases, dining out, or fueling at the gas station — and can then put those rewards toward your travel.

Read more: See our picks for the best American Express credit cards

Do you want flexible travel rewards or would you prefer to earn points or miles under a specific loyalty program?

Finding the right travel credit card isn’t only about how you earn rewards but also how you use them.

Many travel credit cards earn flexible points and miles under an issuer’s rewards program, such as Capital One Travel, American Express Membership Rewards, or Chase Ultimate Rewards. You can redeem the rewards you earn from these programs for:

  • Travel booked through the issuer’s travel portal

  • Gift cards

  • Statement credits to your card account

  • Rewards you can transfer to partner airline and hotel programs

A general travel card can be useful if you want the most flexibility in how you redeem your rewards.

You can also choose co-branded travel rewards credit cards. Airline and hotel credit cards earn rewards under the specific airline or hotel loyalty program — Delta SkyMiles, Southwest Rapid Rewards points, Marriott Bonvoy points, and more. Most often, you’ll redeem the rewards you earn with these cards for future flights or hotel stays with the brand.

Co-branded cards can be useful if you’re a loyal customer of an airline or hotel. They offer benefits tailored to those brands (free checked bags or free night awards, for example) and often help you reach elite status more quickly.

What type of annual fee (if any) makes sense for you?

Despite a reputation for steep annual fees, there are plenty of great travel cards with annual fees under $100 — or even no annual fee.

Higher annual fee cards do typically come with the biggest list of benefits. These benefits can range from airport lounge access to annual credits toward travel spending, upgrades, complimentary loyalty program status, annual discounts with specific partner brands, and more.

While they can definitely be valuable, high-fee travel card benefits are usually tailored to make your travel experience more efficient or enjoyable. If you don’t travel often, you may not get the full value.

You should also make sure these benefits offer savings on purchases you would have made anyway. If you’re spending more than you otherwise would just to take advantage of a credit or perk, that does little to make the annual fee cost actually worth it.

Lower or no annual fee travel cards are typically a little more sparse when it comes to benefits — though they may come with some partner benefits or smaller annual credits. With these cards, the biggest value will come from the rewards you earn. Before you apply, make sure you’re able to maximize rewards categories and make the most of your spending.

It’s probably no surprise that travel credit cards are best for people who prioritize travel on their calendars and in their budgets. In most cases, you’ll get the best rewards value from these cards if you can redeem the points and miles you earn for future travel expenses.

It can also help to maximize your travel card if you’re willing to do a bit of strategizing and research into how to best use your benefits and rewards. While cash-back credit cards are great for direct percentage earnings on every purchase, travel rewards can have different redemption values. It can take some time to find the best way to get the very best value from what your card has to offer.

While you don’t need to be a world traveler to benefit from a travel card, you should travel at least occasionally.

Travel cards may not be ideal if you’re trying to build credit or have a history of overspending. For one, they can be difficult to qualify for if you don’t already have great credit. But they’re also often packed with perks and benefits that can encourage you to spend more than you otherwise would if you’re not careful.

Before applying for any new credit card — and especially a new travel card — make sure the rewards and benefits you’ll get align with how you already spend your money. Otherwise, you could risk taking on debt balances with high interest rates and negating any value you would otherwise gain from your card.

  • Rewards for future travel: If you’re looking to save on an upcoming vacation, a travel credit card is a great place to start. You can redeem the rewards you earn on your spending today for flights, hotels, and more travel expenses in the future. As long as you find the rewards program that best fits your travel plans and budget, your travel card can help stretch your dollars further.

  • Added travel benefits: In addition to rewards, travel perks and benefits offer useful savings when you’re away. Many travel cards offer annual travel credits, savings on checked bags or other airline fee costs, experience credits for your hotel stays, and more. Before you book, make sure you read your card agreement and understand exactly what added benefits are available to you.

  • Great welcome bonuses: Travel cards carry some of the highest welcome bonus offers you’ll find from any credit card today. While points and miles value vary, sign-up bonuses range upwards of 50,000 and even up to 100,000 points, after you meet a designated spending threshold. Make sure that required spending amount is within your budget so you can take advantage of the points boost as a new cardholder.

  • Non-travel redemption value: While travel cards offer major savings on travel expenses, they may not be best for maximizing other redemptions. Some travel cards offer less than 1 cent per point value when you choose non-travel redemptions, such as statement credits, cash back, gift cards, and more. If these are the redemptions you prefer, you’ll probably want to look at other rewards or cash-back credit cards.

  • High annual fees: There are some great travel cards with low or no annual fees, but you will pay a premium price for many of the highest-earning cards. For some, a high annual fee may be worth the price thanks to the value you’ll get back in rewards and benefits. But always make sure to compare your past spending to what you expect to get from the card before you apply — it’s not worth it to pay more for a card than you can earn.

  • Credit score requirements: To get approved for a travel credit card, you’re likely going to need a great credit score. A preapproval or prequalification offer from the credit card issuer can help you learn your chances of approval without a hard credit inquiry. But if you’re still working to build your credit score, consider credit card options for building credit; some credit-building cards still earn rewards you can use to save on your spending.

For most people, a general travel credit card offers a valuable combination of flexible rewards and benefits that can help you save no matter what your future travel plans are. Below are some of our picks for the best travel credit cards to make the most of your travel today.

  • Annual fee
    $95
  • Welcome offer
    Earn 60,000 bonus points after spending $4,000 on purchases in the first 3 months (that's $750 when you redeem through Chase Travel?)
  • Card type(s)
    Travel
  • Ongoing Purchases APR
    21.49% - 28.49% Variable
  • Recommended credit score
    Excellent/Good
  • Rewards rate
    • 5x points on travel purchased through Chase Travel
    • 3x points on dining, select streaming services, and online groceries
    • 2x points on all other travel purchases
    • 1x points on all other purchases
  • Benefits
    • Points are worth 25% more when you redeem for airfare, hotels, car rentals and cruises through Chase Travel
    • Earn up to $50 in annual statement credits for hotel stays purchased through Chase Travel
    • On every account anniversary, earn bonus points equal to 10% of your total purchases made the previous year

Chase Sapphire Preferred has a $95 annual fee and a generous welcome offer, plus a 25% redemption boost (or 1.25 cents per point) when you use your points for travel through Chase Travel.

Each year, you’ll get a $50 annual statement credit for hotel stays booked through Chase Travel. For ongoing rewards, Chase Sapphire Preferred earns 5x points on travel purchased through Chase Travel (excluding hotel stays that count toward the credit), 3x points on dining, 3x points on online grocery purchases, 3x points on select streaming services, 2x points on all other travel, and 1x on everything else.

  • Annual fee
    $95
  • Welcome offer
    Enjoy a $250 Capital One Travel credit, plus earn 75,000 miles after spending $4,000 on purchases in the first 3 months
  • Card type(s)
    Travel
  • Purchase APR
    19.99% - 29.99% variable
  • Recommended credit score
    Good, Excellent
  • Rewards rate
    • 5x miles on hotels, vacation rentals, and rental cars booked through Capital One Travel
    • 2x miles on all other purchases
  • Benefits
    • Receive up to a $100 statement credit for Global Entry or TSA Precheck application fees
    • Receive a $50 experience credit, room upgrades, and early check-in at eligible hotels
    • Access Hertz's Five Star membership tier, offering free upgrades, a wider selection of vehicles, and more

There are few travel credit cards easier to use than the Capital One Venture. For an affordable annual fee, you’ll earn a flat 2x miles on every purchase, plus a boosted 5x miles when you book hotels and car rentals through Capital One Travel. 

Though the Venture Rewards Card is lighter on added benefits than some other travel cards, you will get a fee credit for TSA PreCheck or Global Entry and a $50 experience credit (plus other benefits) when you book the Lifestyle Collection hotels through Capital One Travel. And keeping with this card’s simplicity, you can easily use your miles for travel expenses, either by booking through Capital One Travel or using them to reimburse travel purchases on your card statement.

  • Annual fee
    $550
  • Welcome offer
    Earn 60,000 bonus points after spending $4,000 in the first 3 months (that's $900 toward travel when you redeem through Chase Travel?)
  • Card type(s)
    Travel
  • Ongoing Purchases APR
    22.49% - 29.49% Variable
  • Recommended credit score
    Excellent
  • Rewards rate
    • 10x points on hotels and rental cars purchased through Chase Travel*
    • 5x points on flights purchased through Chase Travel*
    • 3x points on dining and other travel purchases
    • 1x points on all other purchases
    • *After the first $300 is spent on travel purchases annually
  • Benefits
    • Points are worth 50% more when you redeem through Chase Travel
    • Earn up to $300 in annual statement credits for travel purchases
    • Receive up to a $100 statement credit every four years to cover the application fee for Global Entry, TSA PreCheck, or NEXUS

Chase Sapphire Reserve charges a steep $550 annual fee, but it also has plenty of travel value. You’ll get an annual travel credit for the first $300 in eligible travel purchases you make each year, plus airport lounge access and other benefits.

You can also earn the following rewards (for travel categories, rewards only apply after you max out your annual travel credit): 10x points on eligible hotels and rental cars through Chase Travel, 10x on Chase Dining, 5x points on flights through Chase Travel, 3x on other travel purchases, 3x on dining, and 1x on other spending.

Like the Chase Sapphire Preferred, the other big benefit of a Chase Sapphire Reserve is the boosted redemption value you’ll get when you use your points to book travel through Chase Travel. This card has a 50% points boost — meaning you’ll get a value of 1.5 cents per point on eligible travel redemptions.

  • Annual fee
    $325
  • Welcome offer
    Earn 60,000 Membership Rewards? points after you spend $6,000 on eligible purchases in the first 6 months, plus 20% back on restaurant spending worldwide (up to $100 in statement credits) for new cardmembers through November 6, 2024
  • Card type(s)
    Travel, Rewards
  • Ongoing Purchases APR
    See Pay Over Time APR
  • Recommended credit score
    Excellent/Good
  • Rewards rate
    • 4x Membership Rewards Points at restaurants worldwide (on up to $50,000 per calendar year in purchases, then 1x)
    • 4x Membership Rewards points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1x)
    • 3x Membership Rewards points on flights booked directly with airlines or on AmexTravel.com
    • 2x Membership Rewards points on prepaid hotels and other eligible purchases booked on AmexTravel.com
    • 1x Membership Rewards points on all other eligible purchases
  • Benefits
    • NEW: Five Guys is now eligible for $120 Dining Credit. Earn up to $10 in statement credits each month when you pay with your American Express Gold Card at Five Guys, Grubhub, The Cheesecake Factory, Goldbelly, and Wine.com (enrollment required)
    • NEW: Up to $100 in annual statement credits ($50 semi-annually) when you use your American Express Gold Card on eligible purchases at U.S. restaurants on the Resy app or Resy.com
    • NEW: Up to $84 per year ($7/month) in statement credits after using your American Express Gold Card to pay at more than 9,000 Dunkin’? locations nationwide

Despite its annual fee (see rates and fees), the Amex Gold Card makes it easy to justify the cost for most regular spenders. Ongoing rewards include a mix of travel and everyday spending: 4x points at restaurants worldwide, 4x points at U.S. supermarkets (up to $25,000 spent per year), 3x points on flights booked directly with airlines or through Amex Travel, and 1x points on all other purchases.

You can also earn a 60,000 points welcome bonus after spending $6,000 within the first six months. TIf you redeem those Amex GoldTo help offset the annual fee year after year, you can get up to $120 in annual Uber Cash ($10 per month) and up to $120 in dining statement credits with eligible partners ($10 monthly; with enrollment).

In addition to the flexible travel cards above, here are a few of our favorite co-branded hotel and airline credit cards:

This article was edited by Rebecca McCracken

Editorial Disclosure: The information in this article has not been reviewed or approved by any advertiser. All opinions belong solely to the author(s) and are not those of any other entity. The details on financial products, including card rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the bank’s website for the most current information. This site doesn't include all currently available offers. Credit score alone does not guarantee or imply approval for any financial product.