International travel is exciting and transformative, but it can also be expensive. Costs can add up quickly, between rising airfare, hotel expenses, and discretionary spending. Luckily, there is a way you can cut back on your travel expenses substantially while earning rewards for future trips: Travel rewards credit cards.
With the right credit card line-up, you can get free room upgrades, breakfast, checked bags and avoid pesky fees. The annual fee on some of these cards is relatively high, but can pale in comparison to your cash savings. Here’s a look at seven types of credit cards you should take with you abroad for maximum savings:
Credit cards with no foreign transaction fees
When you’re traveling abroad, the one type of card you absolutely need to pack in your wallet is one with no foreign transaction fees. Some credit cards charge around 3% when you use your card abroad. This can add up substantially when using your card for hotel bookings, ground transportation and everything else. The last thing you want is to pay an unnecessary fee on top of already rising travel costs.
Most travel rewards cards don’t charge foreign transaction fees. These include popular ones like the Chase Sapphire Preferred and Capital One Venture. Cash back and no-annual-fee cards are most likely to charge foreign transaction fees, so you want to avoid those. The popular Chase Freedom Unlimited is one of these cards. Be sure to swap these cards out before you go and you’ll save around $30 for every $1,000 charge made abroad.
Cards that offer airport lounge benefits
With travel demand at an all-time high, Airports are incredibly packed these days. Not only are gate areas full of waiting passengers, but airport food is notoriously expensive. Airport lounges are great places to enjoy quiet and a good meal before your flight. The best part? You can get complimentary airport lounge access with credit cards.
The Platinum Card from American Express and Business Platinum offers the most comprehensive lounge benefits, including access to Priority Pass, Centurion lounges and Delta Sky Clubs. If you want a card with a lower annual fee, Venture X is an excellent alternative at $395. You’ll get a specific Priority Pass membership with a $28 per-person credit at select airport restaurants. And if you don’t mind limited lounge access, the Capital One Venture Card comes with two annual free lounge visits and will set you back just $95 per year.
Credit cards that earn bonus points on travel
Whether you’re traveling abroad on a budget or going for luxury, you will spend quite a bit on hotels, activities and dining. Be sure to bring a credit card that earns bonus points in these categories. That way, you’ll earn more than the typical 1 point per dollar and can later leverage these rewards for free flights and hotel nights.
Here’s a look at some credit cards that earn bonus points on travel and don’t charge foreign transaction fees:
- Chase Sapphire Reserve: 10X points on hotels and car rentals and 5X points on air travel booked through Chase Ultimate Rewards, 3X points on other travel and dining
- Capital One Venture X Card: 10X miles on hotels and rental cars and 5X miles on flights booked through Capital One Travel
- Chase Sapphire Preferred Card: 5X points on travel booked through Chase Ultimate Rewards, 3X no dining and 2X on all other purchases
- The Platinum Card from American Express: 5X points for flights booked directly with airlines or with American Express Travel, 5X points on prepaid hotels booked with American Express Travel
- Citi Premier Card: 3X points on air travel, restaurants, supermarkets and gas stations
Cards that offer travel protections
Travel is unpredictable – airlines go out of business, people miss their flights, luggage gets lost and the occasional bout of food poisoning can really put a damper on your trip. But none of them have to, if you have travel insurance. While you can purchase travel insurance, plenty of credit cards offer it completely free. All you have to do is charge your flight and hotel to your credit card and you’re covered.
You can save thousands of dollars in case of a travel emergency, making this a worthwhile step. The Amex Platinum Card offers the most comprehensive suite of travel protections. Those on a budget can opt for the Chase Sapphire Preferred, which offers primary rental car coverage and up to $10,000 in trip cancellation/interruption coverage per person.
Here’s a look at travel protections you should look for when choosing a credit card for your trip abroad:
Primary rental car coverage
Many rewards credit cards offer rental car coverage, but sometimes it’s secondary. If you get into a car accident, you must file a claim with your insurance company first. If your insurance denies the claim, the secondary coverage kicks in. While useful, it’s always best to use a credit card that offers primary coverage.
If you have primary rental car coverage, you won’t have to file a claim with your own insurance company in case of an accident in a rental car. This can save you a lot of hassle and keep your premiums low.
How valuable is this benefit? Last year I wrecked a rental car and the damage totaled over $4,000. Thanks to my Amex card's rental coverage, I was responsible for only $200. The loss was never reported to my insurance company, so my premium didn’t go up either.
Trip cancelation and interruption coverage
When traveling abroad, it’s crucial to have a credit card with trip interruption/cancellation coverage. If your trip is unexpectedly canceled, some credit cards will reimburse your non-refundable expenses. Covered reasons include illness, which is how I recovered almost $1,400 in airfare when my brother got covid last summer and couldn’t travel to Europe. It took about two months for my claim to process, but in the end, I got it all back, courtesy of my Amex Platinum Card.
The Amex Platinum card covers up to $10,000 per trip and $20,000 per eligible card every 12 months. It’s not the only credit card with trip cancelation coverage. The following cards also provide this benefit:
- Bank of America Premium Rewards card
- Chase Sapphire Preferred
- Chase Sapphire Reserve
- Capital One Venture X
- United Club Infinite Card
- World of Hyatt Card
According to Société Internationale de Télécommunications Aéronautiques (SITA), airlines mishandled over four million bags last year. If yours are among them, you can rest easy with baggage insurance through your credit card. Baggage insurance usually covers loss, damage or theft. The Amex Platinum, Sapphire Preferred and Reserve offer some of the most generous coverage at $3,000 per person.
If your bag is merely lost, your credit card’s delayed baggage coverage will reimburse you for necessities. Cards that offer this benefit include the Sapphire Preferred and Reserve, which cover up to $100 per day for five days.
Visa or Mastercard (as a backup to Amex)
American Express cards are great for travel, but Visa and Mastercard are more widely accepted – especially internationally. If you’re traveling abroad, you should consider bringing a Visa or Mastercard as a backup to your Amex card. When choosing a backup, be sure to consider card perks. Look for a card that offers bonus points on travel, trip insurance, purchase protection and maybe even lounge access.
While you should absolutely pack your favorite Amex card for your next trip abroad, having a backup means you’ll continue to earn rewards and enjoy valuable travel perks without dipping into your cash reserves.
A debit card that charges no international ATM fees
While credit cards are widely accepted, sometimes you need cash while traveling abroad. The last thing you want is to incur hefty fees at the ATM. With the Charles Schwab debit card, you won’t have to. The card connects to a High Yield Investigator Checking account. This card and has no fees or deposit minimum. When you use it to withdraw cash at ATMs worldwide, Schwab will credit the fees back to your account. This makes international cash withdrawals a hassle-free experience.
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