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How to maximize your credit card rewards for international travel

Transferable rewards points, hotel loyalty programs and VIP perks can help you save on your next trip abroad

Summary

Travel rewards can help you save big on an international trip. Whether you’re trying to score a business- or first-class fare for next to nothing, earn hotel points you can use anywhere or pick a card that will give you the best possible travel experience, here’s what you need to know.  

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Travel rewards can provide a lot of savings on your next vacation, regardless of where you go.

But if you’re planning a trip abroad, you may have some unique opportunities to maximize your rewards and other benefits your credit cards offer.

There are also a few things to keep in mind when redeeming points or miles for an international trip. Whether you’re trying to score a business- or first-class fare for next to nothing, earn hotel points you can use anywhere or pick a card that will give you the best possible travel experience, here’s what you need to know.

See related:  10 credit and money tips for travel abroad

Use transferable rewards points

If you’re flying within the U.S., you can usually get to where you want to go with just about any domestic airline. But depending on where you’re heading overseas, you’ll likely need more flexibility. Airlines that have a lot of traffic between the U.S. and Europe, for instance, may not have any routes to Southeast Asia.

To solve this potential issue, consider getting a travel credit card that has transferable rewards points. This means you can redeem your rewards directly with the card issuer or transfer them to the bank’s partner airlines or hotels.

“Think of it like this, would you rather have a $100 Chipotle gift card,” says Bryce Conway, founder of 10xTravel, “or a $100 gift card that works at Chipotle, Shake Shack, Five Guys, Blaze Pizza or Torchy’s Tacos?”

Programs with transferable points include:

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To give you an idea of the potential, let’s say you have the Chase Sapphire Reserve card, and you’re planning a trip to Istanbul, Turkey.

If you transfer your Ultimate Rewards points to the United Airlines MileagePlus program, a main-cabin flight from Los Angeles to Istanbul would cost you 60,000 miles or $951, giving you a redemption value of 1.6 cents per mile, which is slightly more than the 1.5 cents per point you’d get if you use your points to book travel through Chase.

If you were to book a business-class ticket instead, you could do it for 225,000 miles or $8,613, which would give you a whopping 3.8 cents per mile.

And you don’t have to stop there because Chase has several other airline partners from which you can choose. If you have the time, you can look up how many points it would require through multiple airlines, giving you more power to maximize the value of your rewards.

“Each of those airlines has their own distinct partners, destinations and prices, providing tremendous value,” says Ben Nickel-D’Andrea of NoMasCoach, a blog dedicated to helping travelers find inexpensive business- and first-class flights.

You can do the same thing with other rewards programs that offer transferable points. If you’re considering getting a new card, do some research on each program to see who their partners are and which one provides the best relationships based on where you want to go.

See related:  Picking the right cards for around-the-world travel

Watch out for high fees

“Some international airlines charge very high fees,” says R.J. Weiss, a certified financial planner and founder of The Ways to Wealth. “So you might get a 30,000-mile one-way flight on British Airways, but then it might be $1,000 in fees.”

These fees can reduce the amount of value you gain from the redemption, so shop around and compare several airlines to avoid paying too much.

Pick a hotel program with a large footprint

If you’re heading to a major city, it’s likely that you’ll find several major hotel brands with properties in the area. But that’s not necessarily the case everywhere you go, and some hotel chains have a much larger footprint than others.

World of Hyatt points, for example, are among the most valuable travel rewards currencies you can get, but Hyatt has roughly 850 properties worldwide. In contrast, Marriott Bonvoy points are worth less than half as much on average, but the brand has about 7,000 properties around the world.

If you know there’s a Hyatt hotel in your destination city, you’ll do better racking up World of Hyatt points. But if not, the selection Marriott provides may be a good trade-off against the lower rewards value.

Remember that transferable points give you more choices with hotels, too. The Chase Ultimate Rewards program allows you to transfer your points to both World of Hyatt and Marriott Bonvoy, plus IHG Rewards Club. While you won’t get elite status or a free anniversary night as you might with a hotel credit card, that flexibility opens up a lot of opportunities.

“If you’re constantly going to the same place, develop loyalty with that chain,” says Nickel-D’Andrea. “If you enjoy the flexibility or variety of hitting a few new countries each year, then getting loyalty with one hotel isn’t the best bet.”

Look beyond the rewards for more experiential value

Credit card rewards can help you save money when booking a flight, hotel, rental car and more. But some cards offer perks that can elevate your travel experience and make it all the more special.

With the Platinum Card® from American Express, for instance, you’ll earn just 1 point per dollar on the vast majority of your purchases. But the card also comes with an impressive number of VIP perks, including:

  • Complimentary airport lounge access with several lounge networks
  • Elite status with Hilton Honors and Marriott Bonvoy
  • Complimentary membership in premium car rental programs, which include special upgrades and discounts
  • Complimentary benefits when you stay at properties with select luxury hotel programs
  • Application fee credit for Global Entry or TSA Precheck
  • Annual credits worth up to $500 for incidental airline fees, Uber rides and Saks Fifth Avenue purchases

Depending on how often you travel and where you’re headed, you could squeeze an incredible amount of value out of those perks.

“I love the lounge access that I get from being a Chase Sapphire Reserve cardholder,” says Conway. “I can also bring two guests with me each time free of charge, meaning that my family can spend layovers in a comfortable airline lounge at virtually any major airport on earth.”

But it’s important to remember the balance between rewards and benefits. If you focus only on rewards, you can get to your destination without spending a lot, but you may miss out on some VIP experiences along the way.

And if you get a card solely for its benefits, you could have a better experience, but you may also end up paying more out of pocket on the total cost of the trip. Take some time to consider what’s the right balance for you based on your travel habits and preferences.

See related:  Airport lounge access guide: Picking the best membership for you

The bottom line

Anyone can use credit card rewards to save money on a trip. But if you’re traveling internationally, your points and miles usually won’t go as far as they will on a domestic trip.

Learning how to maximize your credit card’s rewards — both in terms of value and flexibility — can open up a lot more opportunities and bigger savings.

“When it comes to rewards travel, really international travel is some of the best value you’re going to get for your points and miles,” says Weiss.

Also, keep in mind that using credit cards with valuable perks can make for a more enjoyable trip, even if they don’t necessarily cover all your costs to get there.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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Credit Card Rate Report Updated: July 29th, 2020
Business
13.91%
Airline
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Cash Back
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Student
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