Travel credit cards are popular for good reason—who can resist the allure of free flights and hotel stays? Whether you’re planning your dream trip or visiting grandparents, travel rewards can help keep your vacation costs down and even enhance your trip through such perks as lounge access, hotel elite status and free checked bags.
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What Is a Travel Credit Card?
Broadly defined, a travel credit card is a credit card that earns rewards on your everyday purchases that can be used toward travel expenses. Rewards can take the form of points or miles, which can be redeemed for travel expenses like airfare, hotel stays, car rentals and other travel-related expenses.
Travel credit cards typically include travel-oriented benefits, such as trip delay and cancellation insurance, airport lounge access, hotel status, waived baggage fees and no foreign transaction fees.
Like any other rewards credit card, you’ll earn travel rewards on your everyday purchases. The difference is that those rewards may come in the form of points or miles that can be redeemed directly or indirectly on travel.
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Many travel credit cards are co-branded. That means that the card issuer has partnered with an airline or hotel loyalty program. The name on the credit card might prominently display the airline or hotel brand, but the overall management of the card is the responsibility of the issuer. For example, Citi partners with American Airlines for the Citi® / AAdvantage® Platinum Select® World Elite Mastercard®, while Chase and Hyatt offer The World of Hyatt Credit Card.
When you make a purchase with a co-branded credit card, you’ll earn points or miles in that specific program. When it comes time to redeem for a reward, it will be within that program as well.
General travel credit cards earn points that are not tied to any one travel partner. Instead, the points are specific to the issuer and redeemable according to the rules of that issuer’s program.
How Do Travel Credit Card Rewards Work?
The method of redemption may differ depending on the travel rewards card. Credit cards that earn specific airline or hotel points are straightforward—the rewards go directly into your frequent flyer or hotel loyalty account and you would redeem for rewards within that program. Credit cards that earn issuer-specific points typically have multiple redemption options.
Airline Credit Cards
Miles earned on purchases made with an airline credit card get deposited into your airline frequent flyer account, usually monthly, when your statement closes. To make an award flight redemption, you would follow the process used by that airline’s frequent flyer program.
Hotel Credit Cards
Like an airline credit card, hotel credit card points are credited to your hotel loyalty account monthly, so they’re readily available for redemption according to the program rules. You can redeem as you normally would, for hotel nights, room upgrades or whatever else the program offers.
General Travel Credit Cards
This category consists of travel credit cards with rewards paid in a currency specific to the card issuer. Examples include American Express Membership Rewards® or Chase Ultimate Rewards®. When you earn these types of points, they remain in your credit card account until you are ready to use them.
General travel credit card issuers usually have a portal on their website where you can redeem your points for statement credits, cash back, gift cards or merchandise. Most also provide an option to purchase flights, hotels and car rentals with your points. The value assigned to your points varies by type of redemption, with travel purchases often being one of the better value options as opposed to cash back or gift cards, which tend to be poorer choices and worth less than 1 cent per point.
Transferable Points
Some general travel credit cards allow you to transfer your points to a variety of airline and hotel loyalty programs. This provides you with the maximum flexibility in how and when you redeem your points.
With transferable points, you’re not locked into any one program. You can transfer your points when you are ready to make a redemption and more importantly when you know that the award you want is available. Transferring your points to a partner is likely to give you the most value for your points.
Transferable points also let you maximize the value of your points by choosing the program that will give you the most value. For example, Air Canada Aeroplan and United MileagePlus are transfer partners of Chase Ultimate Rewards. Both are Star Alliance airlines, so their frequent flyer programs can be used to book flights within the Star Alliance. It’s highly likely that the same award flight will cost a different number of miles in each program. Having transferable points means that you can choose to transfer your points to the program with the lowest miles cost for your desired award flight.
Major transferable points programs include American Express Membership Rewards, Chase Ultimate Rewards, Capital One Rewards, Citi ThankYou points and Bilt Rewards.
Welcome Offers
The travel credit card market is highly competitive, which is a boon for the consumer, as card issuers vie for new cardholders through incredibly generous welcome offers. Taking advantage of a welcome offer is a great way to quickly boost your stash of points or miles. Earning a welcome bonus involves spending a specified amount of money within a certain period of time, often three months, to receive a set lump sum of points or miles.
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Travel credit cards offer higher rewards earning rates on travel-related purchases which can accelerate your point accumulation. Airfare, hotels, car rentals and other travel expenses can have spending bonuses as high as 10 points per dollar as opposed to the usual 1 point per dollar.
Other useful nontravel bonus spending categories, such as gas and dining, are frequently offered by travel credit cards, which help build your point balances through everyday spending.
By using the credit card that gives you the highest earnings multiplier on your purchases, you can maximize your point earnings, getting you closer to an award redemption faster.
Should You Get a Travel Credit Card?
Travel credit cards are a great addition to your wallet if you travel regularly and can make use of the rewards and benefits. The return on a travel credit card can be especially lucrative if you redeem them for premium cabin flights or make use of sweet spots in hotel and airline programs.
For a frequent traveler, the benefits of a travel credit card can be invaluable. If you’re spending a lot of time in airports, having lounge access and expedited security clearance through TSA PreCheck or Global Entry makes the whole flying experience a lot more pleasant.
If you’re loyal to a particular airline or hotel chain, it makes sense to hold its co-branded credit cards, not only to accrue points and miles, but to make use of benefits that are specific to that airline or hotel. So, for example, if you live in Atlanta and travel regularly on business, you’d probably be flying Delta, since Atlanta is a Delta hub. In that case, it would be beneficial to have a Delta co-branded credit card such as the Delta SkyMiles® Reserve American Express Card which would give you lounge access, priority boarding, free checked bag and bonus points on Delta purchases (terms apply).
Similarly, if you often stay in one hotel chain because it’s located closest to your relatives or to your corporate head office, a co-branded credit card for that hotel chain would be logical.
If you are an infrequent traveler and have little use for the card benefits, it’s harder to justify the annual fees of a travel credit card. There’s also the opportunity cost of a travel credit card to consider. Instead of accumulating travel-specific rewards, you could be using a cash-back card that returns you cold hard cash with no strings attached.
A 2% everywhere cash-back card such as the Citi Double Cash® Card may suit your lifestyle better. It earns 2% cash back on all purchases—1% when purchases are made and another 1% when they’re paid off, and earn 5% total cash back on hotel, car rentals and attractions booked on the Citi Travel℠ portal through 12/31/25—is simple to use, you don’t have to remember any bonus categories and you don’t have to learn how to navigate the intricacies of loyalty programs. You can turn your cash-back card into your own travel credit card by setting aside your cash back in a travel fund and using that to finance your occasional travels.
Find the Best Travel Credit Cards for 2024
Find the best travel credit card for your travel needs.
How Many Travel Credit Cards Should You Have?
There’s no one-size-fits-all answer to how many travel credit cards someone should have. It depends on your travel habits and goals, your interest in loyalty programs, your overall financial health and your ability to manage your finances.
There are people who maintain multiple travel credit cards effectively, paying off their balances in full every month. They enthusiastically dive into the minutiae of frequent flyer and hotel loyalty programs with the goal of getting as much value as possible out of their points with aspirational travel redemptions. Holding many types of travel credit cards would be the main strategy of this type of cardholder.
Other people have more modest intentions, like earning one domestic family vacation a year, but have other things they’d like to pay for with credit card rewards. For a cardholder like this, a strategy combining one or two travel credit cards and a cash-back card might be more suitable.
Any decision on getting a travel credit card should start with a fundamental analysis of whether you should add another credit card to your wallet at all. Just because you can, doesn’t mean you should. Your credit history and score is valuable.
If you’re carrying a balance or having difficulty making your credit card payments, then getting more credit cards is not a good idea. It’s important to get your finances on better footing before extending yourself with more credit. Additionally, travel credit cards require good to excellent credit scores for approval, so that can be an incentive to get your financial house in order.
Another consideration is annual fees. There are a few no annual fee travel credit cards but they offer minimal benefits and earnings potential. The majority of travel credit cards levy an annual fee, and they can get pricey—The Platinum Card® from American Express for example comes with a lofty $695 annual fee (terms apply, see rates & fees).
Pricing depends on the types of benefits the card offers. For instance, lounge access is a top-tier benefit so credit cards that provide it have top-tier annual fees.
Multiple credit cards means many annual fees which add up fast. Be realistic about the benefits that are useful to you when you assess a travel credit card. Card benefits such as statement credits for travel, free checked baggage and lounge access can offset the annual fee if you are able to use them. In subsequent years, it’s important to revisit whether you are still getting value from the credit card as your needs and travel patterns change.
Common Benefits of Travel Credit Cards
It’s not surprising that travel credit cards offer benefits that enhance the travel experience. The suite of benefits varies depending on the card.
Here are some of the benefits you might find on travel credit cards:
- No foreign transaction fee
- Trip delay and trip cancellation insurance
- Baggage delay or lost baggage insurance
- Auto rental collision damage waiver
- Airline lounge access
- TSA PreCheck or Global Entry application fee credit
Airline Credit Cards
- Priority boarding
- First checked bag free
- Discounts on inflight purchases
- Airline lounge access on premium credit cards
Hotel Credit Cards
- Elite status
- Annual free night
- Room upgrades
Find The Best Credit Cards For 2024
No single credit card is the best option for every family, every purchase or every budget. We've picked the best credit cards in a way designed to be the most helpful to the widest variety of readers.
Bottom Line
Travel credit cards are some of the most lucrative credit cards available. With huge welcome bonuses and category spending bonuses, it’s possible to quickly amass enough points and miles to treat yourself to a vacation.
To view rates and fees for The Platinum Card® from American Express please visit this page.
To view rates and fees for Delta SkyMiles® Reserve American Express Card please visit this page.