How to choose the best travel card in 5 steps

Choosing the best travel credit card can be a tough decision, mostly because there are multiple card issuers, rewards programs and types of travel rewards you can earn. That said, the right travel credit card can help you earn points or miles for free travel and improve your travel experience. After all, many top travel credit cards come with annual free nights, travel insurance, waived checked baggage fees, airport lounge access and more.

Before you choose a travel credit card, you’ll need to understand which type of travel card best suits your spending style and travel needs. Below are five steps to follow to help you choose the best card for traveling:

1. Decide between a co-branded or general travel credit card

Before you do anything else, you’ll want to think long and hard about the type of travel rewards you want to earn. You can start by considering how much flexibility you’d like when it comes to redeeming points or miles, along with your typical travel style and whether you have any preferred airlines or hotels.

When looking for the best credit card for travel rewards, there are two primary types of travel credit cards to consider: co-branded travel credit cards and general travel rewards credit cards.

Many co-branded travel credit cards come with on-brand travel perks. For co-branded airline cards, that typically means free checked bags, priority boarding, in-flight discounts and other frequent flyer benefits. For co-branded hotel cards, that typically means annual hotel credits or automatic hotel elite status. Because co-branded cards let you earn and redeem rewards in a specific travel program, however, they’re best for travel loyalists who use the same brand frequently.

Because co-branded cards let you earn and redeem rewards in a specific travel program, they’re best for travel loyalists who use the same brand frequently. That’s why Katie Kelton, a senior credit cards writer at Bankrate, uses her co-branded Southwest Rapid Rewards® Priority Credit Card instead of a general rewards card.

“I chose it because I almost exclusively fly Southwest, and I don’t like booking through issuer travel portals,” says Kelton. “With the card, I got a hefty welcome bonus and the potential to earn a Companion Pass. Plus, I accrue Southwest points with most of my spending — so any time I go to book a flight, it’s always covered by points. The simplicity of only using one brand just works for me.”

General travel credit cards allow you to earn rewards in a credit card rewards program that lets you use your points or miles in various ways. For example, you may be able to transfer your rewards to several different airline and hotel loyalty programs or use them to purchase travel through your card issuer’s travel portal. You may also be able to redeem your rewards for statement credits, gift cards and select merchandise, among other options. Generally speaking, flexible travel credit cards are best for people who want to use rewards for travel without being tied down to a specific airline or hotel brand.

2. Look for a big welcome bonus

One of the easiest ways to get massive value from travel cards is to earn a welcome bonus. After all, many top travel credit cards offer welcome bonuses that are worth $1,000 or more, depending on how you redeem your rewards.

For instance, the Chase Sapphire Reserve® offers a welcome bonus of 60,000 points after spending $4,000 on purchases within the first three months of account opening. If you redeem that bonus for travel through the Chase Travel℠ portal, your points will be worth 1.5 cents a piece, making your bonus worth $900. And if you redeem your bonus with a high-value Chase transfer partner, your rewards could be worth around 2.0 cents according to our points and miles valuations, making your bonus worth $1,200.

But before banking on those hefty credit card welcome bonuses, make sure you’re able to meet the minimum spending requirements within the required timeframe. For rewards cards, minimum spending requirements typically range from $500 to $15,000 and usually must be met within three to six months. Most people meet spending requirements by charging their daily expenses and monthly bills to their credit card, although that can become more difficult to manage on the higher end of the scale.

Then again, some cards allow you to earn a big welcome bonus with as little as a single purchase. For example, the AAdvantage® Aviator® Red World Elite Mastercard®* offers 60,000 AAdvantage miles after making one purchase and paying the card’s annual fee ($99) in full within the first 90 days. This offer is especially impressive considering the Citi® / AAdvantage® Platinum Select® World Elite Mastercard®*, which also comes with a $99 annual fee (waived the first 12 months), requires you to spend $2,500 within three months of account opening to earn 50,000 AAdvantage miles.

If you’re thinking about opening a rewards card with a higher minimum spending requirement — such as $4,000 over three months — you’ll want to do the math to make sure you can meet this requirement with regular spending and bills. For example, spending $4,000 within three months of account opening requires you to have at least $1,334 in monthly expenses you can charge to the card for three months in a row.

3. Look for lucrative rewards categories that make sense for you

While there’s nothing wrong with going after a big bonus, you should also aim to earn rewards that align with your spending habits in order to reap the benefits of the card long-term. That’s where rewards cards that offer everyday bonus categories and travel perks come in.

If you spend a lot in specific categories, it makes sense to look for cards that offer bonus rewards in those categories. For example, if you spend a lot on dining, gas and groceries, as well as on travel, the Citi Strata Premier℠ Card could be a good choice. It offers:

• 10X points on hotels, car rentals and attractions booked through the Citi Travel portal
• 3X points on air travel and other hotel purchases, at restaurants, at supermarkets and at gas and EV charging stations
• 1X points on all other purchases

It also allows you to transfer your rewards to Citi’s airline and hotel partners, which can help you to get more value from your rewards.

On the other hand, if you don’t want to keep track of which credit card to use (and when), you can opt for card like the Capital One Venture Rewards Credit Card, which has a higher flat rewards rate for all spending than the 1 percent you get with most category cards. This card gives you:

• 5X miles on hotels, vacation rentals and rental cars booked through the Capital One Travel portal
• 2X miles on all other purchases

This card’s simple, flat-rate rewards structure allows you to earn extra points for every purchase, no matter the category. You can redeem your miles for statement credits, use them for travel purchases through the portal or transfer them to Capital One travel partners for even more value.

4. Identify which travel perks matter most to you

Next, you’ll want to look at rewards cards based on their travel benefits and protections. Ideally, you’ll find a travel credit card that offers perks you can actually benefit from, rather than ones that just sound flashy. The right benefits can help offset your card’s annual fee and generate hundreds of dollars worth of value every year.

Premium travel cards tend to have the most benefits, although they also charge higher annual fees. For example, The Platinum Card® from American Express — which is frequently considered one of the best rewards cards for travel — comes loaded with well over $1,000 worth of recurring benefits. These benefits come largely in the form of memberships and travel credits in exchange for a $695 annual fee. However, you’ll want to evaluate whether you can take advantage of enough of the card’s plentiful benefits to justify the card’s annual fee.

As you compare travel credit cards with perks that can make the annual fee well worth paying, look for the following benefits:

• Airport lounge membership

  Some of the best credit cards for airport lounge access offer a Priority Pass Select airport lounge membership, whereas others let you visit select lounges a certain number of times per year. Some issuers, like American Express and Capital One, even have their own airport lounge networks for eligible cardholders. Brooklyn Lowery, a senior credit cards editor at Bankrate, chose a card that would extend this perk to authorized users, too.

  “I opened the Capital One Venture X Rewards Credit Card a few years ago because of its airport lounge access and authorized user benefits, namely that my husband as an authorized user could get his own Priority Pass Select membership,” says Lowery. “He travels for work sometimes and uses the lounges without me, the primary cardholder, with him.”

   

• Airline elite status boost

  While airline credit cards don’t typically grant automatic elite status, some cards let you earn elite-qualifying points or miles toward elite status through credit card spending. The value of earning elite status through credit card spending can be difficult to quantify, but it can help you reach the same level of status without having to spend as much on flights.

• Airline perks

  In addition to earning frequent flyer miles, many airline credit cards come with free checked bags, priority boarding, in-flight discounts on food and beverages and other airline perks you just can’t get with a general travel credit card. The free checked bag benefit alone can easily save you $30 per person per one-way flight, and some airline credit cards extend this perk to multiple people on your itinerary.

• Hotel elite status

  Some hotel cards and general cards offer automatic hotel elite status. For example, the Amex Platinum Card offers complimentary Marriott Bonvoy Gold Elite status and Hilton Honors Gold status.

• Annual hotel credits

  Some hotel credit cards and general travel credit cards come with annual credits for eligible hotel stays. For example, the Amex Platinum card offers up to $200 back in annual statement credits when you use the Amex Travel portal to book a Fine Hotels + Resorts or The Hotel Collection stay (two-night stay minimum required).

   

• Annual credits

  Beyond application or membership fee credits for TSA PreCheck, Global Entry, NEXUS or Clear Plus, many general travel credit cards also offer flexible credits to cover general travel purchases (usually up to $300 worth) or other, more specific annual credits. Some commonly-featured annual credits to look for include airline fee credits for incidentals with a particular airline, gym membership credits, credits for eligible subscription services, Uber or Lyft credits, dining credits or credits with a specific retailer.

  While travel insurance isn’t usually a perk that makes paying an annual fee worth it alone, many of the best general travel credit cards come with numerous travel insurance benefits. Some travel insurance perks to look for include trip cancellation and interruption insurance, primary or secondary auto rental coverage, trip delay reimbursement, baggage delay insurance, lost or damaged baggage protection and emergency medical benefits.

   

5. Do the math to minimize fees

Are travel credit cards worth it? It all depends on the perks you’ll get in exchange for paying an annual fee, and how much that annual fee costs. If you’re considering a travel credit card with an annual fee under $100, justifying the cost should be easy the first year. After all, many travel credit cards offer welcome bonuses worth $500 or more, and that’s on top of the rewards you earn on your spending.

Take the Chase Sapphire Preferred® Card, for example. At the moment, the sign-up bonus for this card is 60,000 points when you spend $4,000 within three months of account opening. That’s worth $750 in travel when you book through Chase Travel℠, which more than offsets the $95 annual fee.

However, you don’t have to pay an annual fee for a travel credit card at all. There are plenty of travel credit cards with no annual fee that offer solid value. For example, the Discover it® Miles comes with a $0 annual fee and unlimited 1.5X miles on all purchases. Plus, Discover will match all the miles earned at the end of your first year.

It’s also important to be aware of foreign transaction fees. Most travel credit cards waive this fee, but not all of them. These fees are usually around 3 percent of each transaction made in foreign currency and they can really add up if you spend a lot overseas. In that case, a credit card with no foreign transaction fees, even if it comes with an annual fee, might save you more in the long run.

The bottom line

The right travel credit card for you depends on factors like how often you travel, the type of rewards you’ll use, the benefits you want the most and how much you’re willing to pay to hold the card. Fortunately, there are so many amazing travel rewards credit cards on the market today that you’re sure to find one that suits your needs.

Take the time to compare our list of the best travel credit cards. Then, make an informed decision based on your research. If you don’t find yourself traveling often enough to justify a travel card, then a cash back card might be a better fit for your needs.

Also, know that you’re not stuck with the same card forever. If you wind up disappointed with the card you select, you can always request a product change or apply for a new card that better meets your needs.

Information about the AAdvantage® Aviator® Red World Elite Mastercard® and Citi® / AAdvantage® Platinum Select® World Elite Mastercard® has been collected independently by Bankrate and has not been reviewed or approved by the issuer.