Why Your Regular Credit Card May Not Make The Best Travel Partner

August 20, 2018

Do you have any upcoming summer plans? If so, you might want to think twice about which cards you don’t leave home without. A recent trip I took to Switzerland and Germany reminded me of how the best credit card(s) for a vacation might not be the same credit card(s) you normally use.

More than just the rewards

When choosing a travel rewards card to book your vacation, don’t just look at the reward rate. Consider other benefits you might use like trip cancellation/interruption insurance, auto rental collision coverage, complimentary airport lounge access, lost or delayed baggage insurance, trip delay reimbursement, roadside assistance, and emergency assistance and benefits. If you’re traveling internationally, you might want to see if the credit card(s) you’re bringing charges foreign transaction fees and if the auto rental insurance coverage is valid where you’ll be traveling.

Converting to other travel rewards

Consider whether the card(s) allows you to convert points to other travel rewards programs as well. This can multiply the value of your points, depending on the value of the program you convert to. Just make sure they’re points you’ll actually use.

For example, Starwood points are currently listed as the most valuable at 2.7 cents per point, but I rarely, if ever, stay in Starwood hotels. For me, the runner-up Amtrak points would be more valuable even though they’re only worth 2.5 cents per point since I do ride Amtrak a lot.

Watch for annual fees

Finally, be aware that a lot of the best travel rewards cards charge annual fees. Don’t let that scare you away, but don’t ignore them either. It all depends on how much you travel. Do the math and see if the higher rewards would pay for the additional fee.

My personal choice for a travel card

For example, my personal choice for travel is the Chase Sapphire Reserve™ Card despite a hefty $450 annual fee. For one thing, I get an annual credit of $300 for travel expenses, making it really a $150 annual fee as long as I spend at least $300 a year on travel. (If you don’t, it’s not worth it.)

I also earn 3 points for every dollar spent on travel (and dining out) and get all the benefits listed above plus credit for global entry fees and a 50% increase in the value of my points (making them 4.5 points for every dollar spent on travel and dining out) when used in the Chase Ultimate Rewards Program®.

That doesn’t mean that card is right for everyone. If you travel less, you might prefer one with a lower or no annual fee. Just don’t assume that the best card(s) to book your trip and take with you on your journey will be the same card(s) you use every day.