Travel credit cards

Table of Contents

How to redeem points and miles
Redeeming rewards on an issuer’s online portal
Redeeming rewards by transferring to a travel partner
Other ways to redeem points and miles
What’s the best way to maximize travel rewards?
How to maximize your travel rewards
How to choose a travel rewards card
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A travel credit card offers points or miles for the purchases you make with the card that you can redeem for future travel.
In terms of redemption, you’ll typically get the most value by redeeming toward travel in your issuer’s portal or by transferring rewards to travel loyalty programs.
Before applying for a travel card, consider its fees, ongoing rewards structure and first-year welcome bonus opportunity.

Travel credit cards make it easy to earn rewards — usually offered in the form of points or miles — for certain types of purchases. You can typically redeem your travel rewards for the big expenses associated with your next trip such as flights, hotels, car rentals and vacation packages.

How to redeem points and miles

Once you’ve met the requirements for a hefty welcome offer or earned enough miles to cover your next flight, how do you redeem them? The kind of travel card you have and its respective rewards program determine how you can apply those rewards. If you have a hotel or airline credit card, you can typically only redeem those points with their respective loyalty programs minus a few exceptions. However, there are more ways to redeem flexible travel rewards like booking through your card issuer’s online travel portal or by transferring your points or miles to an issuer’s travel partner.

Redeeming rewards on an issuer’s online portal

Your card issuer will typically have a portal on its website that lists redemption options and points values. Examples of redemption options include statement credits, travel purchases, gift cards and cash back. Rewards programs typically use a 1:1 conversion rate, meaning every 100 points or miles is worth $1. Some issuers, like Chase, also offer boosted points values or other perks for travel purchases made through their online portal. To get an idea of how much your points and miles are worth, take a look at Bankrate’s points and miles valuations page for an in-depth look at airline, hotel and credit card program rewards values.

To redeem your rewards on an issuer’s online portal, simply log in to your account and locate the appropriate rewards or travel section.

Redeeming rewards by transferring to a travel partner

Some travel rewards cards let you transfer points or miles to the issuer’s travel partners, which may include frequent flyer programs or hotel loyalty programs. This is often how to get the most value out of your travel rewards.

You can redeem travel rewards by transferring to an eligible travel partner through the issuer’s online portal. Transfer times can range from instantly to a few days — so plan ahead. Note, once you transfer points or miles from an issuer to a travel partner, you won’t be able to transfer them back to the issuer.

Other ways to redeem points and miles

Some credit cards allow you to redeem your points and miles for things like statement credit, cash back, gift cards or other merchandise. This is usually the least valuable way to redeem your points and miles so you’d be better off using them towards travel most times.

What’s the best way to maximize travel rewards?

When you want to make the most of your rewards, there’s no shortage of ways to spend a stockpile of points or miles. But here are some of the best ways to use your travel rewards:

https://www.bankrate.com/finance/credit-cards/best-way-to-use-points-for-travel/#traveling

Book luxury accommodations
Cover or lower the cost of your next flight
Reserve a rental car at your destination
Upgrade a flight or hotel stay

Be sure to check your card issuer’s online portal and travel partners for rotating deals to help stretch your rewards further. In many cases, you can also choose to exchange your travel rewards for cash or a statement credit. But keep in mind that doing so usually dilutes the buying power of those rewards. Once you get the hang of using your travel credit card, you can maximize those rewards on bigger, better travel plans.

https://www.bankrate.com/finance/credit-cards/maximize-rewards-on-international-trips/

In general, the best value for flexible travel rewards will come from transferring them to various loyalty programs. For instance, Bankrate estimates that a Chase Sapphire Preferred® Card member’s rewards could be worth about [shortcode Points and Miles, Chase Ultimate Rewards Sapphire Preferred (43)] each when transferred to a high-value travel partner, but they’re worth only 1.25 cents each when redeemed for travel through the Chase travel portal.

How to maximize your travel rewards

As we’ve mentioned, the best way to redeem points or miles is to transfer your rewards to one of the issuer’s airline or hotel partners and redeem them for accommodations or airline tickets. But making good use of a travel rewards card is about more than just earning and redeeming rewards — it’s also about managing the card itself well.

Whether you’re trying to get the best possible redemption value or want to know which pitfalls to avoid, here are a few tips to help you get the most out of your travel rewards.

Many travel credit cards come with generous sign-up bonuses requiring you to spend a certain amount within the first few months of opening the account. Although these bonuses are often an attractive incentive to apply for a card, make sure the spending requirement is realistic for your budget and travel plans before you choose a travel credit card. You don’t want to end up in debt for the sake of earning extra rewards.

Don’t ignore the card’s fees

Credit card fees don’t directly affect the rewards you earn, but the cost of the fees does affect a card’s overall value to you. Take note of all the fees associated with any card you’re interested in getting.

One of the biggest fees to watch out for with travel credit cards is the annual fee some of them charge. Not all travel cards come with an annual fee, but those that do can range from an approachable $95 to $695 (or more!). If you’re interested in a travel card that has an annual fee, be sure that the rewards and benefits will offset the cost. Otherwise, consider our list of the best travel credit cards with no annual fee.

Watch out for foreign transaction fees

Some credit cards charge a foreign transaction fee for purchases in foreign currency. This fee is usually around 3 percent of a purchase, and you’ll pay this fee for every transaction you make overseas. If you travel abroad frequently, you should consider getting a credit card with no foreign transaction fees.

Luckily, many of the best travel rewards cards don’t charge foreign transaction fees, but it’s always a good idea to verify that before applying.

Make sure you have the right card

It’s important to find the right travel card for your needs, which you can do after comparing options and considering all their pros and cons. For example, if you’re partial to a certain airline or hotel chain, a co-branded credit card can offer higher rewards rates, discounts and perks.

Additionally, pay attention to a travel credit card’s rewards categories. For example, earning points or miles at restaurants won’t deliver a lot of value if you rarely dine out. But if you use services like Lyft or Uber a lot, you may want to look into a card that offers points or miles for rideshares.

How to choose a travel rewards card

Choosing the right travel rewards card is a highly personalized decision. Ultimately your spending habits, goals, finances and credit history will determine which travel card works best for you. This may require some self-reflection and an assessment of your financial situation to find the right travel card. Review these factors in your financial life to get clear on which travel card you need:

Travel preferences. Do you prefer using one specific airline or hotel chain when you travel? Or would you rather have the freedom to use your points on whichever hotel and flight you choose? For loyalty-based rewards go for a co-branded travel card.
Spending habits. What do you spend the most money on? One of the best ways to choose a travel card is finding one that offers the highest rewards for the categories you spend the most in.
Welcome offers. You may find welcome offers for travel credit cards where you can earn extra rewards by meeting purchase requirements within a certain timeframe. As long as you’re able to comfortably meet the spending requirements, a bonus offer could be a deciding factor.
Credit history. Like most credit cards, applying for a travel rewards card means a hard credit check to determine eligibility. If you know where your credit score stands, it’s best to choose travel rewards cards that fit your credit profile to avoid unnecessary denials and credit inquiries. For cards that match your credit, use Bankrate’s CardMatch™ tool.
Annual fee. There are plenty of travel credit cards with no annual fee if that’s what works for your budget. However, some cards with annual fees are worth it thanks to extra perks and benefits.