How to maximize rewards on an international trip

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Published on September 11, 2023 | 5 min read

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Key takeaways

Using a credit card isn’t an option in all travel destinations, but where cards are accepted, using them can help you rack up rewards while adding fraud protection to your purchases.
The best travel cards offer up to 5X points on travel spending and at least 1X points on all other spending. Visa and Mastercard tend to be most broadly accepted abroad.
Beware of foreign transaction fees and currency conversion fees, which can add up rapidly and negate your rewards earnings if not avoided.

Traveling abroad can be thrilling, riveting… and expensive. From airfare to lodging and all the spending you do on the ground, costs add up quickly.

With the right credit card, though, you can actually benefit from these purchases. Credit cards are convenient. Plus, they can offer added protections against fraud and you can maximize rewards by charging everything to your card.

Despite the many positives, you may have some reservations about using your credit card internationally. After all, credit cards aren’t accepted in every city in the world and some merchants will add fees for card transactions or offer discounts when you pay cash.

But you shouldn’t let these concerns get in the way of maximizing rewards during international travel. Here are some ways you can best earn rewards while abroad.

Check your issuer’s merchant category codes

If you’re using your credit card for purchases abroad, you’re probably looking to maximize your point earnings. Many credit cards offer bonus points on travel spending, with some as high as 5X points per dollar spent.

But it’s important to stay aware of how the purchases that would earn you bonus points at home may not code the same abroad.

If you really want to maximize every dollar with your cards’ bonus categories, you can look up merchant codes ahead of time to determine how your credit card processor codes them. This can be lucrative if you’re paying a significant amount for a boutique hotel or tour operator and are unsure whether it will be coded as a travel purchase. If your Amex card doesn’t code the purchase as travel but your Visa does, you know which card to use.

Use a flat-rate rewards card

Even if you’re unable to maximize bonus categories while abroad, you can still earn your card’s flat rewards rate.

Ideally, you’ll want a card that earns more than 1X points per dollar spent on all purchases. The Capital One Venture Rewards Credit Card and Capital One Venture X Rewards Credit Card fit this criterion. They both offer 2X miles on all spending (before any additional bonus categories). They’re ideal for folks who want to earn elevated rewards without the hassle of trying to maximize rewards. This can work out well when you’re on vacation and don’t want to obsess about which card to use for different purchases.

Make sure your card is accepted

You can’t maximize your card spending if you can’t actually use your card while traveling. If you’re traveling off the beaten path, credit cards may not be as widely accepted as they are in the U.S. — which is why it’s always a good idea to travel with a bit of cash, just in case.

If credit cards aren’t accepted where you’re traveling, there’s not much you can do about it. But you can increase the odds that if cards are accepted, your issuer is among them.

Generally, Visa and Mastercard are the most widely accepted credit cards worldwide. So if you’re traveling internationally and your main cards are from American Express and Discover, you might want to bring a backup Visa or Mastercard, just in case.

That’s not to say that you shouldn’t bring a Discover or American Express card with you on international trips. They’re common in many parts of the world. Still, it never hurts to have a backup.

In addition to your credit card network, you’ll also want to make sure your card has the right technology to be accepted with merchants abroad.

Nowadays, most U.S. credit cards have chips but prompt a signature at checkout instead of a PIN number. Some of these cards have PIN capabilities, though not all consumers set one up. This can be problematic if you use your credit card abroad, since you might need to enter a PIN at checkout if the terminal doesn’t allow a signature. Not having a chip and PIN card might cost you rewards on your next international trip, especially if you’re traveling to Europe.

While many terminals can detect that a card doesn’t have an associated PIN and should be processed with a signature, there are exceptions. I’ve had countless transactions declined in Turkey because the card reader prompted a PIN and wouldn’t process the payment without one. This issue occurred randomly and created a minor inconvenience.

If you want to avoid being mistaken for trying to skip out on a bill because your cards aren’t functioning, set up and memorize your credit card PIN before your next trip abroad.

Avoid unnecessary fees

Credit card companies charge foreign transaction fees on purchases processed outside of the U.S. — usually between 1 and 3 percent. These foreign transaction fees can actually negate the value of any rewards you earn on travel expenses, especially if you use your card on big-ticket expenses like hotels and rental cars.

While a 3 percent fee may not sound like much, it’s about the same rate as you’ll earn in many rewards card bonus categories. Plus, an extra $30 in fees for every $1,000 spent can put a dent in your travel budget.

But this is easily solved by using a credit card with no foreign transaction fees. Most top travel rewards cards waive these fees now, so you can use your card abroad without this added expense, while still earning rewards on your purchases.

Another added cost to avoid when paying with a card is the currency conversion fee, which can be as high as 8 percent. Luckily, you can avoid them by paying for your credit card purchases in local currency. That way, you won’t incur additional fees when your card issuer converts the transaction to U.S. dollars. Most of the time, merchants will ask you if you want to pay in local currency or U.S. dollars. But some will skip this step to avoid confusing their customers. If a merchant doesn’t give you a choice, it’s worth requesting that they process the transaction in local currency.

The bottom line

You don’t have to forgo your rewards strategy when you travel. The right card can help you earn bonus points or miles on your international spending while offering added security and waiving potentially costly fees. In fact, using a credit card abroad is a great way to maximize your spending and earn rewards for future travel. However, there are still some cases in which cash is your only payment option.

Additionally, in some countries, merchants will impose their own fees on credit card transactions — usually 3 percent to 5 percent. Merchants at other destinations may offer discounts on cash transactions. In both scenarios, you should weigh the savings against the value of the rewards you’re giving up.

Next time you take an international trip, do some research on your destination and specific issuer guidelines to ensure you get the most out of every purchase you make.