Traveling often involves careful planning. You want to have everything you could need. One thing you don’t want to forget is your credit cards.
Using credit cards for traveling is an excellent idea. Credit cards are the most secure payment option. They can also come with numerous travel perks and protections.
Should a Credit Card be Used for Travel?
When traveling abroad or domestically, you want to be safe. Credit cards provide the best fraud protection. Credit cards are an ideal option for every step of the process. Credit cards can be used for:
- Securing flights. A credit card is the best way to protect yourself when traveling. It will be easier to secure a refund if issues arise. If a flight gets canceled or delayed, you could qualify for money back.
- Hotels. Most hotels will require a credit card throughout your stay. Credit cards also make it easier to make in-hotel purchases. You can earn rewards depending on your card type as well.
- Transportation. Using ride-shares is a common occurrence with travel. Using a credit card makes paying and tipping easier.
- Eating. You are likely to eat at restaurants more when traveling. Many credit cards offer rewards that are specific to dining. You also don’t have to worry about conversion rates.
- Purchasing souvenirs. Souvenirs are a natural part of travel. You want a keepsake for yourself or your family. Credit cards can help protect these purchases.
What Are the Benefits of Using Credit Cards for Traveling?
There are several different perks you can experience when using credit cards. The benefits can vary depending on your type of card. In general, credit cards provide security and ease of use.
Rewards
One of the best perks of using a credit card is the possible rewards. Travel can get expensive with transportation, stay, food, and excursions. You can benefit by gaining:
- Cashback. Most cards offer at least 1.5% cashback. Some cards offer additional perks associated with travel. This could be for airfare, gas, hotel stays, and dining at restaurants.
- Points. Points can be earned in several different ways, such as by making purchases or meeting spending requirements. A person is typically awarded one point for every $1 spent.
- Miles. This reward option is associated with an airline’s frequent flyer programs. You can earn a certain number of miles for every $1 you spend. This is a great reward if you travel often.
Safety and Protection
Credit cards for traveling provide a real sense of safety and protection. They are a safer option for both domestic and international travel. When traveling, it is best to carry a few different cards.
It is much easier to secure a credit card that is lost or stolen. Most issuers have a quick lock button feature on their app. You can freeze your card the moment you realize it is missing.
When a card gets stolen, there is the fear of fraudulent charges. Most credit cards offer a limited or 0% liability for fraud. This peace of mind is valuable, especially when traveling.
When traveling, you want to be able to use your money easily. Using cash can be difficult with exchange rates and unexpected fees. You also want to be mindful of carrying around too much cash.
Major credit cards are accepted internationally. This often provides a better exchange rate. Many credit cards waive any foreign transaction fees.
Purchase and Trip Protection
Some credit cards will offer purchase protection and travel insurance. This makes traveling easier and more rewarding. You could be covered for:
- Damaged or stolen items. It is beneficial to use your credit card for purchases when traveling. If an item gets damaged or stolen, you could get your money back. When purchasing souvenirs, you can rest assured you are covered.
- Baggage delays. Different credit card companies offer protection on baggage. If the baggage is delayed for over six hours, you could be compensated. You can get the funds needed to purchase necessary replacement items.
- Trip interruption and cancellation. It is smart to use a credit card for any pre-paid, non-refundable trips. You could be protected if your trip is cut short or canceled. This varies depending on the situation.
What Should Be Avoided When Using Credit Cards for Traveling?
When you are using your card for traveling, be sure to avoid the following:
- Not letting your provider know you are going abroad. You want to avoid having your card blocked. It is beneficial to give your provider a heads up if you are traveling internationally. This ensures you won’t be flagged for potential fraud.
- Using a card with foreign transaction fees. These fees are usually around 3% of your purchase amount. This can seem small but adds up quickly. Several cards available offer no foreign transaction fees.
- Not avoiding dynamic currency conversion. This is the process of converting the amount you owe to U.S. dollars. This can seem like a smart idea, but it can be expensive. It is best to opt for local currency when making a purchase.
- Not watching your credit utilization ratio. You want to have the money to back up the bulk of your credit purchases. If you use more than 30% of your available credit, you could hurt your credit score. It is important to be mindful of how much you are spending on one card.
The Bottom Line
Traveling with credit cards is a great idea. You are more secure, better protected, and often receive additional rewards. Credit cards are a great way to have peace of mind when traveling. Remember to always weigh the pros and cons of using a credit card, however for traveling we recommend just sticking to your cards.