Having the right credit card can make all of the difference when traveling. Before I really got into traveling, I was relatively new into the world of credit cards (especially as a US permanent resident who had to build credit from scratch as an adult), so I didn’t research much into what credit card to use beyond whatever one had no foreign transaction fees. Now that I am an avid traveler, I have found a few cards that make traveling so much more enjoyable.
Credit Card BASICS
When looking for a credit card to use when traveling, there are a few basic things to look for if you are planning to travel:
- No foreign transaction fees. Most credit cards have foreign transaction fees that are automatically charged on any transaction that is in a foreign currency, or outside of their home country. These can add up quickly, and add unnecessary expenses (usually around 3% extra on top of whatever currency conversion rate your credit card uses). Pick a card without foreign transaction fees to avoid paying more than is necessary for basic things like food and transport while you are abroad.
- Travel Insurance. Find a card that offers relatively comprehensive travel insurance abroad. Most credit cards offer some level of coverage, so review your coverage in detail before traveling. In order to use your credit cards travel insurance, you need to book all major travel related expenses, such as airfare, on that card. This insurance will help cover you if you get stuck while traveling due to unforeseen circumstances. There are some credit cards made specifically for travel that offer really great extended insurance benefits that I’ll talk about later.
- Card Type. Most countries around the world accept credit cards, and with a few exceptions, most places will accept Mastercard and Visa. Do not travel with only an American Express or Discover card, as often these card types are not accepted period, or are hard to find in foreign countries. In addition to this, make sure your card has a chip, as well as a pin if possible. Most countries outside of the US are far ahead in terms of card security, so they may have machines that won’t accept a credit card without a chip. In some countries such as China, other forms of pay such as AliPay (QR code based payment through an app) are very common, so do some research ahead of time to make sure you are equipped and ready before you get there.
Premium Cards
Beyond these basic principles, there are endless options for extra benefits that you can access through specialized travel cards and accounts. One of my hands down best travel investments I have ever made was signing up for the Chase Sapphire Reserve credit card. This is a premium credit card with a $550 annual fee, so it’s not for everyone. Cards like this and the American Express Platinum card are great for frequent travelers who will use all of the extra benefits. I use my Chase Sapphire Reserve card to book all of our travel, and it is the card I use exclusively while traveling.
Annual Fee: $550
Travel Benefits:
- Priority Pass lounge access. With the card you receive complementary Priority Pass Select membership. This has been an absolute life saver when traveling – especially outside of the US. I have found lounges within US airports to be hit or miss, but in many other areas the lounges have showers, full buffets and other benefits that make layovers easy to bare. With this pass you can bring in up to 4 other people with you, which is great when traveling with friends or family who don’t have a Priority Pass for themselves.
- $300 Travel Credit. Each year you receive $300 in travel credit that automatically applies to your statement after you make qualified purchases (such as Airfare or Hotels).
- Travel Insurance. I won’t get into too much detail on the specifics of the insurance, but it includes extensive rental coverage, lost and delayed baggage coverage, delayed/cancelled flight insurance and much more!
- Credit for TSA Precheck/Global Entry. When you apply for TSA precheck or Global Entry and use the credit card to pay the fee, you will receive a statement credit back for that amount.
Annual Fee: $550
Travel Benefits
- $200 Airline Fee Credit. When you select an airline, you can receive up to $200 per year in statement credit towards airline fees such as checked bags and on-flight charges.
- Credit for TSA Precheck/Global Entry. When you apply for TSA precheck or Global Entry and use the credit card to pay the fee, you will receive a statement credit back for that amount.
- Global Lounge Collection Access. Like the Priority Pass, this card offers access to an exclusive network of lounges, including the Centurion Lounges, and some select Priority Pass and Delta Sky Club lounges.
Additional Resources
Travel Points: There is a huge community online dedicated to how to most effectively earn and use Travel Points to travel. This is something I’m still digging into and I don’t consider myself an expert by any means, but if you do sign up for a premium card with some travel point benefits, definitely look into the FBZ Elite Travel & Points Facebook group, where lots of experts on credit cards and traveling with points are active. If you don’t want to interact on a Facebook Group, you can go on their website www.financebuzz.com
Getting Cash: One of the most effective and affordable ways to get cash when traveling in a foreign country is to simply go to an ATM when you are at the airport, and use your debit card to take out cash. Usually this wil offer you the best exchange rate (better than using the exchange counters or your bank before traveling), and you will simply have to pay the ATM fee and a fee your bank will charge for using an out of network ATM. As long as you limit the number of times you pull out cash to one or two times, this is usually an effective way to get cash when traveling.
Alternatively, if you plan on traveling frequently or want to have access to cash often, I recommend setting up a checking account with a bank with no foreign ATM transaction fees. The bank that I use and recommend isCharles Schwab. I set up my account online, and simply transfer in however much money I need before a trip into my checking account, so my money is in limited risk if it were to be stolen. With this card, I can take out money as often as I would like at any ATM, and Charles Schwab won’t charge me an ATM fee, and will reimburse me for any ATM fees charged by the ATM on the transaction. This has been a life saver, and since it’s a debit card and checking account, it’s really low risk!
