Are you dreaming of a vacation you don’t think you can afford? While you are skipping the expensive lattes and saving every extra cent that comes your way, why not consider using one of the best travel credit cards to make the purchases you require. There are many out there that can help you get airline tickets and hotel rooms for free or nearly free.
What to look for in travel rewards
There are several factors to consider before choosing what you believe is the best travel credit card for you. These include:
- What is the annual fee? While many companies will offer the first year free, many cards charge up to $450 for the use of the card each subsequent year you keep the account open.
- How is travel credit earned? Most cards offer 1- 2 points per dollar. However, some can offer up to 5 points per dollar.
- When can points be redeemed? Watch for blackout dates and other rules the company has in place. Will you be able to use the points when you want to go on vacation?
- Are there any limits on how many points you can use at once? In other words, will you be able to pay for the whole family with your accumulated points?
- Do the points expire? If you don’t get to use them this winter, will they still be there in when summer vacation rolls around?
Be wary of the signing bonus that most cards offer. There is often a high spending amount in a short amount of time attached to it. It is designed to get you to sign up, not to get you to where you want to be.
Addition questions to consider before signing for new plastic
While the above are important questions to start your search, there are several other things to consider before deciding which company has the best travel credit card for you. For example, if you are traveling overseas, you need to find out if the card charges a foreign transaction fee. These are not covered by accumulated points and can rack up quickly. Banks often charge between one and three percent when making purchases outside of the US.
Another thing to consider when looking for a new credit card is the annual percentage rate. Credit cards with perks such as airline miles and free hotel stays often come with high interest rates attached. Make sure that you can pay off your purchases each month or in a reasonable amount of time so that you don’t acquire additional debt trying to get a free vacation.
A third thing to research before deciding on the best travel credit card is the value of the awards. You may earn them one way, say two points per dollar, but then redeem them at a different, often lesser value. It can even be as low as one cent on the dollar. In addition, there is no consistency through the industry on how points are converted when redeemed.
A final thing to research before determining which company has the best travel credit card is whether or not the card offers additional rewards and benefits. These can include anything from non-travel rewards such as gift cards to local stores and restaurants, to not having to pay a baggage fee, priority boarding, or being able to use an exclusive lounge while waiting for departure at the airport. While many credit cards offer these services, you also want to double check that the card offers car rental and travel insurance as well as emergency travel assistance.
There are many companies that offer travel rewards as perks for its customers. In order to ensure you are getting the most for your money, the first place you should look is to the bank that you currently use. Using the bank where you already have an account can ensure that you get credit for additional transactions that may not be available with a traditional credit card, such as using direct deposit or making a mortgage payment. It also may insure a lower interest rate since you already have a relationship with them.
Another place to look is to your dream destination. Does the airline you want to take or the hotel you want to stay at have a rewards credit card. These may be the best travel credit cards if you stay at the same hotel or fly on the same airline consistently.
[Read: How to Afford Travel]
Whichever card you decide is the best travel credit card, be sure to read the fine print. Know what you are signing up for before you make the commitment and then let it take you to where you want to go. Happy travels.
Here’s how you can easily choose a travel credit card: