Are Travel Credit Cards Worth It?

Travel credit cards are often worth it for frequent travelers, but they aren't for everyone. They can offer great long-term value with perks like mile earnings, airport lounge access, travel insurance, elite status and hotel night credits. However, weighing these benefits against the often high annual fees is important. If you manage your spending wisely and fully utilize these rewards, the right travel or hotel credit card could make your trips more cost-effective and comfortable.

The value of a travel credit card depends on how you travel and use the card. While pesky annual fees and rigorous redemption processes might be common concerns, benefits like flight and hotel stay points or perks like travel insurance and early boarding can make a difference. If you travel regularly and are also looking to build status, a travel credit card may help you save on trips, but it's important to weigh those perks against the costs.

Perks like priority boarding or free checked bags might seem small, but they can add up, especially for frequent flyers. Ultimately, if you're willing to navigate the fees and redemption process, a travel credit card could get you trips at an effectively lower price or even a free trip, thanks to the annual companion certificates some airline credit cards offer.

If you're still unsure, consider how often you'd actually redeem the rewards. Some travelers find the process too complicated, and unused points can lose value over time. However, for those who plan ahead and stay organized, significant long-term savings may await.

Choosing the best travel card depends on your travel style and goals. For elite status seekers, airline cards like the Delta SkyMiles® Gold American Express can accelerate your path to elite status with bonus points and perks. Use companion certificates strategically on expensive international routes to maximize value for you and a companion.

For strategic spenders, cards that earn bonus points on travel and dining, like those offered by Chase or Amex, let you rack up rewards faster. Transfer these points to loyalty programs to unlock premium flights and hotel stays at a fraction of the cost. Frequent flyers can benefit from airline cards that offer lounge access, priority boarding and free checked bags. Also, timing redemptions with airline sales can stretch your miles even further.

Even occasional travelers can benefit from hotel or flexible rewards cards. Redeem points for peak-season flights or luxurious hotel stays, often covering your annual fee with just one or two redemptions.

General travel credit cards are not linked to any particular group, hotel or airline. However, they still let you redeem your points/miles for travel rewards. The Citi Premier® Card, for instance, lets you earn 3X points per dollar on travel purchases as well as on other bonus categories. It also gives you the ability to transfer your reward points to popular loyalty programs without needing to pay an additional fee.

Depending on the card you get, you may also expect benefits such as travel protections, airport lounge access and statement credits for payments made toward eligible service providers.

Hotel credit cards are linked to specific groups of hotels, such as Marriott, Hilton and IHG. When you use these cards at properties that are part of the chosen group, you stand to earn reward points faster. For example, the Hilton Honors American Express Surpass® Card lets you earn 12X points per dollar at properties within the Hilton portfolio. Some such cards offer free account anniversary nights when you renew the card or after spending a certain amount each year. Other benefits might include elite status, hotel night credits, free on-property Wi-Fi, late check-outs and complimentary breakfast.

Airline credit cards are linked to loyalty programs of specific airlines such as United, Delta and Southwest. These cards typically offer reward miles instead of points. When you use these cards to pay for airline tickets through their issuers' travel portals or directly through airlines, you stand to earn high reward rates. Card-specific benefits might come in the form of free companion certificates, complimentary seat upgrades, discounts on in-flight purchases, access to airport lounges, priority boarding, free checked bags and TSA PreCheck/Global Entry fee credit.

If you plan to pay off your credit card balance in full each month to avoid interest charges, the rewards you earn through a travel credit card and the benefits you enjoy might be worth the annual fee.

While many travel credit cards charge annual fees under $100, premium credit cards may charge up to $695. However, travel cards with high annual fees typically come with a range of benefits that can justify the higher annual fee.

For instance, the American Express Platinum Card, which comes with a $695 annual fee, gives you a $200 hotel credit, a $240 digital entertainment credit, a $155 Walmart+ credit, $200 in Uber Cash and a $200 airline fee credit each year. Cardholders get access to the American Express Global Lounge Collection at airports worldwide, Marriott Bonvoy Gold Elite Status, Hilton Honors Gold Status and travel insurance coverage. This card comes with a sizable welcome offer and lets you earn up to 5X points on certain travel purchases.

Getting to know the answers to other common questions about how travel credit cards work will hold you in good stead when making a selection.