What makes a credit card work for international travel
The best international travel card removes two costs that hit most cardholders abroad: foreign transaction fees and unfavorable exchange rates. A card with no foreign transaction fee saves you 2% to 3% on every purchase outside the United States. A card that uses the Visa or Mastercard exchange rate (rather than the bank's own rate) saves you another 1% to 2%. Together, those two features cut your actual spending by 3% to 5% compared to a standard card.
Beyond fees, the card should offer travel protections that matter when you're away from home: trip cancellation insurance, emergency medical coverage abroad, and lost luggage reimbursement. These protections are built into the card's terms and activate automatically when you charge your trip to that card. You don't pay extra for them.
Rewards that convert to travel value—points that book flights, hotels, or transfers—matter only if you spend enough to make them worthwhile. A card that charges an annual fee makes sense only if the rewards or protections you use exceed that cost in real dollars.
Key Takeaways
- Foreign transaction fees (typically 2% to 3%) apply to every purchase made outside the United States on most standard cards, so a card with zero foreign transaction fees saves money on every transaction abroad.
- Travel protections like trip cancellation insurance, emergency medical coverage, and lost luggage reimbursement come built into premium travel cards and activate automatically when you book through the card.
- Rewards that convert to travel value (points for flights, hotels, or transfers) only justify an annual fee if you spend enough to earn rewards that exceed the fee amount each year.
- The Visa or Mastercard exchange rate is better than most bank-set rates, so cards using the network rate save you an additional 1% to 2% on foreign currency purchases.
Cards with zero foreign transaction fees
Foreign transaction fees are charged by the card issuer (the bank) on top of the exchange rate conversion. Most standard cards charge 2% to 3% per transaction. Premium travel cards charge 0%.
Cards that eliminate this fee include the Chase Sapphire Preferred, the American Express Platinum Card, the Capital One Venture X, and the Bank of America Premium Rewards. Each charges an annual fee ($95 to $695), so the zero foreign transaction fee is one of several benefits bundled into the card's cost. If you travel internationally once or twice a year and spend $5,000 to $10,000 abroad, the fee savings alone can cover the annual cost.
Some cards with no annual fee also offer zero foreign transaction fees—notably the Capital One Venture One and the Chase Sapphire Preferred for the first year (then $95 annually). These cards are worth comparing if you travel occasionally and want to avoid annual costs.
Travel protections and what they actually cover
Premium travel cards include trip cancellation insurance, which reimburses you if you cancel a prepaid trip for a covered reason (illness, injury, death of a family member). The reimbursement typically covers the cost of the trip up to $5,000 to $10,000, depending on the card. You must have charged the trip to that card for the insurance to apply.
Emergency medical coverage abroad is a second common protection. If you become ill or injured while traveling outside the United States, the card's coverage pays for emergency medical treatment up to $100,000 to $250,000. This is secondary coverage, meaning your personal health insurance pays first, and the card covers what your insurance doesn't.
Lost luggage reimbursement covers baggage delayed by the airline for more than 12 to 24 hours. The card reimburses you for essential items you had to buy (toiletries, clothing) up to $500 to $2,500. This protection does not cover the luggage itself—only the cost of replacing items while you wait for your bag.
Read the card's benefits guide before you travel. Each issuer defines "covered reason" and "emergency" differently, and some protections require you to file a claim with documentation (receipts, medical records, airline reports). The protections are free with the card, but they require you to know they exist and to follow the claims process.
Rewards that work for travel spending
Travel rewards come in two forms: points that book flights and hotels directly through the card's travel portal, and points that transfer to airline and hotel loyalty programs. A third form—cash back—gives you a percentage of spending back as statement credit, which you can use however you want.
Points that book through the card's portal are easiest to use but often worth less per point than points transferred to an airline. For example, a point might be worth 1 cent when you book a hotel through the portal but 1.5 cents when you transfer it to a hotel loyalty program and book directly. The difference matters only if you spend enough to accumulate points worth the effort.
Airline transfer partners vary by card. The Chase Sapphire Preferred transfers to 15 airline programs; the American Express Platinum transfers to 17. If you fly one airline consistently, check whether that airline is a transfer partner before you open the card. A card that transfers to your airline is more valuable than one that doesn't.
Cash back (typically 1% to 5% on travel purchases) is the simplest reward. You earn a percentage of what you spend and can use the cash back for anything—future travel, paying down the card balance, or a statement credit. Cash back is worth less than points if you spend heavily and can maximize point value, but it's worth more if you travel occasionally and don't want to track redemption strategies.
Annual fees and when they make sense
Premium travel cards charge $95 to $695 per year. The fee is charged on your statement every year, on the anniversary of when you opened the card. Some cards offer a statement credit (usually $100 to $300) that offsets part of the annual fee if you spend on specific categories like travel or dining.
A $95 annual fee makes sense if you travel internationally at least once a year and spend $5,000 or more abroad. The foreign transaction fee savings alone (2% to 3% of $5,000 is $100 to $150) cover the fee. If you travel less frequently or spend less abroad, a no-annual-fee card is better.
A $695 annual fee (like the American Express Platinum) makes sense only if you use the card's premium benefits: the travel credit (usually $200 to $300 per year), the airline fee credit ($200 per year), and the lounge access. If you use three or four of these benefits, the annual fee is offset. If you use none of them, the card costs you money.
How to compare cards side by side
| Card | Annual Fee | Foreign Transaction Fee | Trip Cancellation Insurance | Rewards on Travel |
|---|---|---|---|---|
| Chase Sapphire Preferred | $95 | 0% | Yes, up to $10,000 | 3x points on travel and dining |
| American Express Platinum | $695 | 0% | Yes, up to $10,000 | 5x points on flights booked directly |
| Capital One Venture X | $395 | 0% | Yes, up to $10,000 | 10x miles on travel booked through portal |
| Capital One Venture One | $0 | 0% | No | 2x miles on all purchases |
| Chase Sapphire Preferred (first year) | $0 (then $95) | 0% | Yes, up to $10,000 | 3x points on travel and dining |
When comparing cards, list the features that matter to you: annual fee, foreign transaction fee, specific protections, and the rewards rate on categories where you spend most. Then calculate the net cost: annual fee minus the value of rewards you'll actually earn and protections you'll actually use. A card with a $95 fee and $150 in foreign transaction fee savings has a net cost of negative $55 (it saves you money). A card with a $695 fee and $200 in travel credits has a net cost of $495 (you pay that much for the remaining benefits).
When to use a different card for specific purchases
You don't have to use the same card for every purchase abroad. Some cardholders carry two cards: a travel card for flights, hotels, and large purchases (where the foreign transaction fee savings matter most), and a cash-back card for small purchases and restaurants (where the rewards rate matters more than the fee savings).
This strategy works if you're organized enough to track which card you used where. For most travelers, one card that handles both foreign transaction fees and rewards is simpler and sufficient.
Before you travel, notify your card issuer of your destination and travel dates. This prevents the card from being declined due to fraud detection. Most issuers let you do this through their mobile app or website; some require a phone call. The notification takes five minutes and prevents a blocked card from ruining your trip.
Frequently Asked Questions
Do I need a travel card if I only travel once every few years?
If you travel once every few years and spend less than $3,000 abroad per trip, a no-annual-fee card with zero foreign transaction fees (like the Capital One Venture One) saves you money without requiring you to earn enough rewards to justify an annual fee. Premium cards with annual fees make sense only if you travel at least once a year.
What's the difference between points and miles?
Points and miles are the same thing—different card issuers use different names. Chase calls them points; American Express and Capital One call them miles. Both can be redeemed for travel or transferred to airline and hotel programs. The redemption value depends on how you use them, not on the name.
Can I use a travel card if I have a balance on another card?
Yes. Opening a new travel card does not affect your ability to carry a balance on an existing card. However, new card applications do a hard inquiry on your credit report, which can lower your credit score by a few points temporarily. If you're planning to apply for a loan or mortgage soon, space out credit card applications by at least a few months.
Do travel protections work if I book through a third-party site like Expedia?
Trip cancellation insurance and other travel protections typically require you to charge the trip to the card, but they don't require you to book directly with the airline or hotel. Booking through Expedia, Kayak, or another third-party site counts as long as the charge appears on your card statement. Check your card's benefits guide to confirm, because some issuers have specific booking requirements.
What happens to my rewards if I close the card?
Points and miles remain in your account after you close the card, so you can redeem them later. However, some cards require you to redeem points within a certain time after closing (usually 30 to 90 days), so check your card's terms before you close it. If you have an annual fee card, close it after you've used any annual credits and before the next annual fee posts.