Tag: credit

Airline credit cards are a good way to maximize travel spending and enjoy perks along the way. An airline credit card is a card co-branded between a credit card company and a specific airline, earning you airline miles for your purchases on the card–often with added returns for purchases from that airline. If you’re looking at some future travel, an airline credit card might be a lucrative investment in your next trip.

The first thing to figure out with an airline specific card is which airline. First, check your travel history and see if there’s a natural leader in which airline you prefer to fly. You might also look at if a specific airline has a major hub near you. For example, American Airlines’ main hub is the Dallas/Fort Worth International Airport and United’s is in Denver. If you live by these airports, these airlines would be a good bet.

From there, it’s time to explore that airline’s different credit card offerings. Most airlines have a basic credit card, a mid-tier card, and a premium card and it can get confusing which one will fit the bill for you. You’ve got to think about where you stand on the size of acceptable annual fee, points per dollar, free checked bags, priority boarding, airport lounge access, and foreign transaction fees.

If you need some help, we’ve tried, tested, and read the fine print on each of the cards and picked our top choices of the best airline credit cards for the average frequent flier. Plus, if you’re feeling less airline loyal, we snuck a few general travel cards into the mix as well.

The Best Airline Credit Cards

• Alaska Airlines Visa Signature: Best for Alaska Airlines Flyers
• Citi / AAdvantage Executive World Elite Mastercard: Best for American Airlines Premium Perks
• Citi / AAdvantage Platinum Select World Elite: Best for Mid-Tier American Airlines Flyers
• Delta SkyMiles Reserve American Express Card: Best for Premium Delta Airlines Flyers
• SouthWest Rapid Rewards Priority Credit Card: Best for Southwest Airlines Flyers
• United℠ Explorer Card: Best for United Flyers
• Chase Sapphire Preferred: Best for General Travel Card
• Capital One Venture X: Best for Premium Flexible Travelers
• Venture Rewards Credit Card: Best for Flexible Redemption

What is an Airline Credit Card?

An airline credit card refers to a travel reward credit card that is co-branded with the card brand and a specific airline. Cardholders earn miles on that specific airline for the purchases they make with their credit card. Often you can get extra miles or benefits if you use the card for travel specific purchases.

Airline credit cards also sometimes offer extra perks for cardholders when they travel. If you travel on the airline, you might receive free checked bags, priority boarding, airport lounge access, and even sometimes companion tickets.

How Do Airline Credit Cards Work?

Airline credit cards work by paying you points or miles for your everyday eligible purchases. You simply make purchases wherever the card brand is accepted, but there are higher rewards for airline purchases than other eligible purchases. These purchases then rack up miles that apply to the airline’s frequent flyer program. With these miles, you can book flights with this airline and sometimes other airlines partners.

How many miles you actually earn per purchase depends on the airline but most offer 1 mile per dollar for normal purchases and 2-5x the miles for airline purchases. Sometimes there are also other incentivized categories like hotels and rental cars.

Alternatives to Airline Credit Cards

An airline specific credit card is not right for everyone, especially if you don’t have a favorite airline in mind. Check out some of the alternatives below if you’re not ready to commit to an airline card but still want some travel rewards.

Travel Rewards Credit Card

A general travel rewards credit card might be a good choice if you don’t have airline loyalty but still want travel rewards. Often these cards will reward you for everyday purchases but have enhanced rewards for travel purchases. They offer more flexibility in how you earn and how you redeem than most airline credit cards. You can often even transfer points to specific airline partners’ websites. You won’t get airline specific perks like priority boarding, but they do often come with pretty awesome sign up bonuses.

We snuck a few into our list above if you want to check them out. While there are a lot on the market, these are our front runners.

Hotel Credit Cards

A hotel credit card can help you recoup some of the expenses of traveling. Like an airline credit card, a hotel credit card rewards you more points for staying in their branded hotel properties. These points can be cashed in for free nights or even sometimes transferred to their airline partners.

Airline Rewards Program

If you’re not interested in a new credit card, just signing up for an airline’s frequent flyer program might have unforeseen benefits. These programs keep track of your flights and reward your flight purchases, slowly building your miles until you can purchase future flights with them. While you won’t see the big bonuses that the best airline credit cards offer, frequent flyer points can become valuable quickly.

Frequently Asked Questions (FAQs) about Airline Credit Cards

Still thinking? Check out answers to the most frequently asked questions about airline credit cards.

Contributor Whitney Hansen covers banking, credit cards and investing for The Penny Hoarder. She also writes on other personal finance topics.

Nowadays, consumers can get instant approval when they apply for certain credit cards, but it can take another week or two before that powerful plastic rectangle arrives in the mail. For many, that’s just fine — they can just use other credit cards and debit cards in their wallets.

But what if you need to use that card the day you’re approved? That’s where instant use credit cards come in. An instant use credit card allows you to make purchases immediately, either through a barcode, digital card number or your digital wallet.

Not every credit card issuer offers instant credit card numbers, and some issuers may only offer it on select credit cards. If you don’t have time to wait for a physical credit card in the mail, prioritize applying for one of these coveted cards.

What Is an Instant Use Credit Card?

An instant use credit card allows consumers to begin using their new line of credit as soon as they are approved. Rather than swipe a physical card, consumers pay digitally — like through Apple Pay or Google Pay, with a digital account number or even using a barcode.

Co-branded credit cards — like store cards, airline cards, and hotel cards — are common candidates, but even some other common travel and rewards credit cards are available for instant use. American Express, for example, offers an instant credit card number for all of its cards (as long as you apply online).

How Do Instant Use Credit Cards Work?

Upon approval for an instant use credit card, the card issuer will provide you with a method for using the card digitally, typically through a barcode or an instant credit card number.

• Barcode: When opening a store credit card, like the Target RedCard or Walmart Rewards Card, look for a barcode on the receipt. Use this until your physical card arrives in the mail.
• Instant credit card number: Credit card issuers offering instant approval typically give you a digital card number that you can use online or in your digital wallet. Sometimes this number matches the physical card number; sometimes the two are unique.

In either case, you should still expect your physical credit card to arrive in the mail — usually within one to two weeks.

Benefits of Instant Use Credit Cards

Instant credit card numbers offer a lot of perks to those who qualify:

• Instant access to credit: The biggest and most obvious perk? You can immediately use your new credit card for purchases. Whether you’re financing a large purchase, like a new couch, or booking a last-minute trip to Europe, having instant access to your line of credit is helpful.

• Emergency expenses: While a new sofa and a flight to Prague are nice, the biggest value of instant access to your credit is when you need to cover an emergency. Whether it’s to cover an unexpected vet visit or a flat tire on your drive home from work, a card offering immediate approval and instant access can be a life saver.

• Instant deals: Some store cards may get you discounts every time you swipe. That’s why cashiers often urge you to open the card when you’re checking out. Though you should exercise caution when opening a new line of credit (and the checkout line of a Kohl’s isn’t where you should usually debate the pros and cons), opening a card in this scenario could save you a lot of money right away — especially if your shopping cart is full of hundreds (or thousands) of dollars worth of stuff.

• Travel rewards: Several co-branded cards, like airline cards and hotel cards, offer instant card numbers when you’re approved. That means you can immediately start using them to book hotels, flights and other travel purchases — and watch those points and miles roll in.

• Cash back rewards: Some cash back cards are instant approval credit cards, like the American Express Blue Cash Preferred Card. If you wait until your physical card arrives in the mail, you’re giving up one to two weeks of expenses that you could be earning cash back on.

• Sign-up bonus: Most travel and rewards cards offer a sign-up bonus that requires you to spend a certain amount of money in a set number of months. By getting instant access to your credit card number, you can start spending toward your goal immediately. It makes earning your sign-up bonus considerably easier.

Which Credit Card Issuers Offer Instant Use Credit Cards?

Instant use cards offer consumers a lot of perks without any downsides (as long as you can responsibly manage a credit card). But finding a card offering instant approval and instant use can be harder than you might think.

Many card issuers offer instant use for a select number of cards, meaning you’ve got to navigate through their offerings to find eligible cards. American Express is the big exception: As long as you apply on a computer or smart device, you should get instant access upon approval.

Here’s a list of major card issuers — and the low down on their instant approval credit cards:

American Express

As long as you apply for your Amex online, you should receive an instant credit card number to begin making online retail purchases, add the card to your digital wallet and even make travel purchases through Amex Travel.

This applies to core American Express cards like the American Express Blue Cash Preferred, American Express Blue Cash Everyday, American Express Gold Card and American Express Platinum Card.

It also applies to co-branded cards, like the Marriott Bonvoy Brilliant American Express Card and the Hilton Honors American Express Card

Bank of America

Bank of America is one of many banks that offers some instant use cards. Several of its co-branded cards offer instant use, as do the Bank of America Customized Cash Rewards credit card and Bank of America Premium Rewards credit card.

The catch? You’ll need to apply through the mobile app. This makes it more attractive for current Bank of America members who already have the app downloaded.

Barclays

Like Bank of America, Barclays offers instant credit card numbers for some of its co-branded cards, including several airline and cruise cards. Among these cards are the Frontier Airlines World Mastercard, JetBlue Card and Carnival World Mastercard.

Capital One

If you already have Capital One, you can get an instant credit card number upon approval if you meet specific criteria. That number will be available in the Capital One app, which you can use for online retail purchases or purchases made over the phone.

Chase

Chase has credit cards on both the Visa and Mastercard networks, but only its Visa cards offer instant use — and even then, not all the Visas.

Notably, some of our favorite Chase cards do offer instant use via digital wallets, including the Chase Sapphire Preferred, Chase Sapphire Reserve and Chase Freedom Unlimited. Two top airline cards also make the cut: the Southwest Rapid Rewards Priority Credit Card and the United Explorer Card.

The Amazon Prime Rewards Visa Card from Chase is not only instantly available for use on Amazon, but it also includes an instant sign-up bonus: a $100 Amazon gift card. This card has no annual fee and offers sizable cash back rewards. (Non-Amazon Prime members can qualify for the Amazon Rewards Card; it has a smaller sign-up bonus and lower rewards rates but is also available for instant use.)

The list of Chase exclusions is long, however. You won’t get instant use with any of the following Chase credit cards: Disney Visa Card, Disney Premier Visa, Chase Freedom Flex, IHG Rewards Traveler Credit Card and Aeroplan Credit Card, to name a few. Chase’s business credit cards are also excluded.

Citi

Citi’s core credit cards are not instant use (though all cards are eligible for immediate approval). However, some of Citi’s notable co-branded credit cards do offer instant card numbers, like the Costco Anywhere Visa Card and Citi’s American Airlines cards.

SoFi

SoFi only offers one credit card — the SoFi Credit Card — but it is immediately available upon approval.

Synchrony

Synchrony offers two co-branded retail cards that offer instant use: the PayPal Cashback Mastercard and Venmo Credit Card.

Store Credit Cards

Several co-branded store cards — like the Costco Anywhere Visa Card by Citi, the Amazon Prime Rewards Visa Card by Chase, the Apple Card by Goldman Sachs and the Capital One Walmart Rewards Mastercard — offer instant card numbers.

Some large retailers also offer closed-loop credit cards (cards that you can only use at that store) with instant use capabilities, including the Target RedCard, Walmart Rewards Card and Kohl’s Credit Card.

What to Look for in an Instant Use Credit Card

Instant use cards offer a number of perks, but the instant gratification may tempt you to open a card without fully thinking it through. Here are some things to consider before applying:

Annual Fee

Some cards mentioned above charge an annual fee for you to keep them open. If you don’t envision yourself using the card beyond the initial purchase — or infrequently enough that it’s not worth paying an annual fee — skip out. There are enough instant use cards on the market that you should be able to find one that suits your needs without an annual fee.

APR

The appeal of immediate access to credit can lure you in to applying for a card, but research the APR before doing so. While we recommend never carrying a balance month to month (that’s how you avoid paying credit card interest), you should prioritize cards with a lower interest rate, just in case.

Some instant use credit cards offer a 0% intro APR. This makes them helpful when financing a major purchase. As long as you can pay off the balance during that introductory period, you won’t have to worry about accruing interest.

Other Fees

It’s not just the annual fee and APR you need to consider. Think about foreign transaction fees if you plan to use the card abroad and balance transfer fees if you want to carry over a balance from a high-interest credit card.

Rewards

Getting instant access to a line of credit is great, but think about the long term. Ideally, you should choose a credit card that offers cash back (as a statement credit) or rewards points or miles for every purchase.

Looking for a great rewards credit card? Check out our favorites:

Sign-Up Bonus

Rewards cards also typically offer a welcome bonus to reward you for immediate spending. It’s easier to earn your sign-up bonus with an instant use card since you’ll have access to the card sooner.

While you shouldn’t prioritize a credit card solely because of its sign-up bonus, such welcome offers can be important to your larger overall consideration.

Other Perks

Can’t choose the right rewards credit card for your wallet? Think about other perks, like a statement credit for airfare or checked bags. Co-branded airline and hotel credit cards are more likely to offer such perks — and many are instant use.

The Platinum Card by American Express might be the most perk-heavy card available, with a statement credit for everything from streaming services to hotel stays to Uber Eats. And like all Amex cards, this one’s available for use instantly.

Minimum Credit Score Retirement

Borrowers with fair credit can usually qualify for store credit cards, but travel and rewards cards are typically reserved only for consumers with good or excellent credit. Before applying, make sure your credit score is strong enough to guarantee approval.

Contributor Timothy Moore is a writer and editor in Cincinnati who covers banks, loans, insurance, travel and automotive topics for The Penny Hoarder.

Although it doesn’t make for the most interesting reading material, your credit card statement is something you’ll want to get in the habit of checking on a monthly basis.

Why? Because credit card statements are the fastest way to get all the essential details about your upcoming credit card bill.

They provide details on your card balance, minimum payment, interest payments, and so much more. Credit card statements are also one of easiest ways to ensure you’re on track with your financial goals, and that you won’t have any bad surprises when your credit card payment is finally due at the end of your billing cycle.

So how can you go about checking your monthly statement without turning it into an hours-long process? Here’s everything you’ll need to know to efficiently browse your credit card statement each month.

What Is a Monthly Statement?

The monthly statement comes via mail or electronically and includes a breakdown of any new charges on your account (like any recent purchases you’ve made) as well as information on your outstanding balance, minimum payment and interest charges. Your monthly statement is one of the best ways to check and manage the activity on your credit card. Think of it like a prerequisite to your credit card bill that provides a big-picture summary of your credit card balance and payment schedule.

What’s in my Credit Card Statement?

Besides providing the big picture on your credit card account, a credit card statement will also show a few key items, like a list of any fees you’ve incurred in the last billing cycle (such as late payment fees or foreign transaction fees), as well as details on your previous balance and whatever payment you last made.

These statements will also help you track how much of your available credit line is left based on your current monthly balance. Since credit utilization is a key aspect of building your credit score, it’s something worth noting whenever you receive a monthly credit card statement.

Your credit card statement also shows your minimum required monthly payment as it relates to your overall balance. While it’s not required to pay your balance in full every month, you’ll save money on interest charges by doing so—since these only kick in when you have an outstanding balance on your card from the previous month.

If you get a minimum payment warning and you ignore it, your account could be closed for non-payment and/or turned over to a collection agency.

Glossary of Credit Card Statement Terms

Account Summary

Your account summary is pretty much what it sounds like—an overview of your credit card statement for that payment period (which is usually about a month long). It will include details about how much you’ve used your credit card during that time period as well as how much you owe. It may not include everything listed below (or may have these items listed in a different order), but it will generally have details on most of the following:

• Account number: This is your credit card number. You will need this number to identify yourself whenever contacting your bank or credit card issuer.
• Account activity: This section of your credit card statement will list all the transactions made during your current billing cycle, including the amount of your purchases and details on the merchant you purchased from. Some card issuers even assign a reference number to each purchase, making it easier to reference if you have questions later (like if you suspect you’ve been the victim of fraud or identity theft).
• Payments: This refers to any previous payments you made on your credit card balance. If you pay your card in full each month, then this number will match your “Previous Balance.”
• Credits: This is often grouped in with your payments, and refers to any credits (ie. deposits) made into your account. Credits happen if your credit card issuer owes you money or if you return an item and receive a refund back onto your credit card.
• Purchases: This number reflects the total dollar amount of any purchases you made during your current billing cycle.
• Balance transfers: If your credit card allows balance transfers, the total dollar amount for any balance transfers made during your current billing cycle will be shown here.
• Cash advances: This reflects the total dollar amount of any cash advance you withdrew from your account during the current billing cycle. Not all cards allow for this, so it may not appear on your statement.
• Fees: If you’ve been charged any fees (like late payment fees, foreign transaction fees, or even an annual fee) they will appear under this category as part of the total for your owed balance.
• Interest charges: Whenever you carry a balance on your credit card for more than one billing cycle, you will incur interest charges (you may even be responsible for paying something called residual interest). These charges vary quite a bit based on your credit score (those with higher credit scores tend to qualify for cards with lower interest rates, among other perks).
• New balance: This reflects your current owed balance for your account. Keep in mind this number may include your previous balance (if it was not paid in full) plus any new charges or fees you’ve incurred in your current billing cycle. 
• Available credit: Your available credit is how much of your credit line is still available to you. For example, if you have a credit line of $5,000 and your current balance is $2,000, then you’d have an available credit of $3,000.
• Cash access line: For credit cards that allow cash advances, this will tell you how much you’re allowed to borrow.
• Opening/closing date: Here you’ll find the first and last day of your billing cycle listed.  Purchases made before or after those dates will appear on your previous (or forthcoming) credit card statements.
• Days in billing cycle: This tells you exactly how long your billing cycle lasts, which is usually around 30 days.

Payment Information

This part of your credit card statement will provide details on how much you owe during that billing cycle. Here are a few of the key terms you’ll likely see:

• Current statement balance: Although it’s also listed elsewhere on your statement, card issuers tend to list it at least twice to make sure you see it. This number is synonymous with your “New Balance” and reflects how much you currently owe on your account, and includes any previously unpaid balance, plus any new purchases, interest charges or fees from your current billing cycle.
• Minimum payment due: This is the minimum dollar amount you’ll need to pay by the listed due date to avoid paying a late fee. Minimum payments are calculated differently depending on your card issuer’s policies as well as your current balance and interest rates. Most banks generally charge either a flat rate (like $25) for balances under $1,000, or a percentage (usually around 2%) for balances over $1,000. Some banks will also calculate your minimum payment by adding up whatever interest charges you owe plus 1% of your current balance. It’s generally advised to pay more than your minimum balance to avoid getting in over your head with credit card debt.
• Minimum payment warning: This section of your statement includes a table that shows you how long it would take you to pay off your balance (usually several years) if you continued to only make minimum payments (and not put any new charges on your card).
• Late payment warnings: This warning reflects the maximum dollar amount you may be charged if you fail to pay your credit card bill on time. Although banks typically won’t charge this full amount for first time offenders, they very well may do so for subsequent late payments.

Rewards Summary

If your card has a rewards program, you’ll find all the details about your rewards balance in this section of your credit card statement.

• Previous rewards balance: This reflects your rewards balance prior to your current billing cycle.
• Rewards earned this month: This number tells you how many rewards you’ve earned during your current billing cycle.
• Bonus rewards: If your card is offering bonus rewards in certain categories, and you’ve recently qualified for these bonus rewards, they will be listed here.
• Total rewards available: This reflects how many rewards are available to use right now. Since some banks take longer than others to process rewards, this number might not include all of the rewards you’ve earned in the current billing cycle.

Frequently Asked Questions (FAQs) About Credit Card Statements

Contributor Larissa Runkle frequently writes on finance, real estate, and lifestyle topics for The Penny Hoarder.

“Would you like to get a 20% discount on your purchase today with a store credit card?”

It’s a question you’re likely to hear at many a checkout counter every Black Friday, that infamous shopping day that follows Thanksgiving. (More and more, though, Black Friday is a multiweek affair.)

At some stores, it’s a question you’ll hear each and every time you shop, regardless of time of year.

What’s the right way to react to this all-too-common scenario?

This post explains the basics of store credit cards, looks at the impact they can have on your credit, and shows you how they compare to regular credit cards offered by banks, credit unions, and online lenders.

Most importantly, you’ll get the data you need to decide if that 20% discount is worth it.

What are Store Credit Cards?

Store-branded credit cards are a revolving line of credit that can typically only be used at the store which issued it. Examples of store credit cards include the Target RedCard and the Macy’s Star Rewards Card.

Some store credit cards can be used at an entire family of stores. That’s the case with the Gap Good Rewards card. You can use it at Gap, but you can also use it at sister stores Old Navy, Athleta, and Banana Republic.

How Do Store Credit Cards Work?

Store credit cards work a lot like regular credit cards. When you swipe at the checkout, you won’t owe any money in the moment. But that money will be due at the end of your statement cycle. If you pay off your balance in full, you won’t owe any interest. If you don’t, though, store credit cards do typically charge higher-than-normal APRs.

While the best financial move is to pay off your store credit cards in full every month, at the very least you will want to pay the minimum due each statement cycle. If you don’t, you risk a late payment reporting to the credit bureaus, which can have a negative impact on your credit score.

Negative marks on your credit report can make it harder to secure financing in the future. If you do manage to secure a loan or other debt product with negative items on your credit report, the interest rate you’re offered will likely be higher.

Store cards are typically unsecured, which means you don’t have to put up any collateral. But if you have poor credit, some stores will issue a secured store credit card. This means you have to put a deposit down, then you will “borrow” against your deposit. If you make regular, on-time payments, secured store credit cards can help you build and improve your credit.

Amazon is one retailer that does this. Its Prime Store Card is an unsecured credit card, while the Amazon Prime Secured Card requires a deposit of $100 to $1,000. You can graduate to an unsecured Prime Store Card after a year of on-time payments. At that point, you’ll get your deposit back.

Pros and Cons of Store Credit Cards

There are disadvantages and advantages to using store credit cards. We’ve gathered the most prominent  to help you decide if using a store credit card makes sense for you.

Store credit cards usually come with lower minimum credit requirements than credit cards issued by large banks. That means that depending on the store, it may be easier to qualify with less-than-perfect credit or a higher debt-to-income ratio.

Another positive to store credit cards is that unlike many bank-issued credit cards, most store cards don’t come with an annual fee.

Some store credit cards offer regular discounts that are significant enough to take note. For example, as a Target RedCard holder, you get 5% off every purchase you make at Target. Target also does price matching, so if you find an item cheaper somewhere else, you can purchase it at Target plus get an extra 5% discount on top of the price match.

During the holiday season, many stores offer promos with store card signup. You might be offered 20% off your first store card purchase or a free thermos when you’re approved for your store credit card. While these offers can be viewed as a one-time positive, they often serve as bait that can get you ensnared in a credit trap if you’re not careful.

The most obvious con of store credit cards is that you can only use them at one, specific store — or in cases like Gap, you can only use them at one family of stores. But there are other potential negatives, too.

Store Credit Cards Encourage Spending at One Store

Store credit cards can encourage you to spend more with a certain brand or retailer than you would otherwise. That 5% off with every RedCard purchase? It’s a net positive if you’re using it for purchases you would’ve made anyways.

But if you find it’s feeding your Target addiction, it can end up being a net negative. If you’re spending $200 more per month with a retailer than you normally would, there’s no discount on Earth that’s going to help you make up the gap in your budget.

Because store credit cards can encourage irresponsible spending, they can also create nightmares for repayment and your credit report if they’re not used with caution.

High Interest and Potential Negative Line Items

If you can’t afford to repay in full, you’re likely to be charged sky-high interest rates. If you can’t even afford your minimum payment, your credit is going to suffer, making it more difficult to do things like secure a car note or obtain a mortgage in the future.

Application will Ding Your Credit Score

While store credit cards do tend to come with lower minimum credit requirements, that doesn’t mean there are zero standards. Every time you apply for a credit card or other lending product, your credit scores could take a slight hit. Usually, this is okay if you’re approved as the new line of credit gives you an opportunity to build your score by making regular, on-time payments.

But If you apply for a store credit card at checkout only to find out you don’t meet the credit requirements, you could walk away with a ding on your credit report with nothing to show for it.

Lower Credit Limits Lead to Higher Credit Utilization

Store credit cards also tend to have lower credit limits than regular credit cards. This can affect your credit utilization. An ideal credit utilization is somewhere around 30% or less.

Let’s say you have a regular credit card with a limit of $2,000. You spend $400, resulting in 20% credit utilization.

But if you have a store card with a limit of $500 and spend that same $400, your utilization rate is 80%, even though you spent the same amount of money.

What Are Hybrid Store Credit Cards?

Hybrid store credit cards can either be debit rewards cards that are linked to your debit account or credit cards issued in partnership with a traditional lending institution. Some stores offer multiple types of cards, including the hybrid credit card.

For example, Macy’s has two cards: Its store card is the Macy’s Star Rewards card, but it also has another option called the Macy’s American Express Card.

With the latter, you can use your card anywhere — not just at Macy’s. But when you redeem points earned on purchases, you’ll be able to convert them all into Star Money to spend at Macy’s only. While it’s nice that you can use the card anywhere, the rewards are still limited to that one retailer.

Let’s say you don’t want a credit card, but you do want the rewards. Some retailers, like Target, give you that option. Instead of a RedCard that functions like a credit card, you can opt for a RedCard debit card.

The debit card links directly to your preexisting checking account, so you won’t be borrowing any money or putting any negative marks on your credit report. But you’ll still get the 5% discount on all of your Target purchases.

You will still have to be careful about overspending, though. Just because it’s debit rather than credit doesn’t mean excessive spending won’t hurt your budget. It would just do so without interest.

Are Store Credit Cards Worth It?

If you’re already doing weekly shopping with a specific store and the card gives you a perpetual discount, then, yes, a store credit card could be worth it if you’re using it responsibly without increasing your spending.

But most store credit cards only offer an initial discount. The one-time discount or promotional offer opens you up to potential credit woes in the future that may not be worth the initial “savings.”

Alternatives to Store Credit Cards

Regular credit cards offer many of the same benefits of store cards with less limitations. Sometimes the benefits cast an even wider net.

Higher Credit Limits

While credit requirements for regular credit cards tend to be higher, they also tend to offer a higher credit limit, which can ultimately lower your credit utilization rate.

You do need to remember that those higher credit limits tend to come with slightly higher credit requirements. It’s completely possible to qualify for a bank-issued credit card with less-than-perfect credit, but it’s going to be harder.

Cashback Rewards Wherever You Shop

The Discover Cash Back Credit Card offers 5% cash back rewards on every purchase you make in rotating categories, like gas stations or restaurants. You don’t have to frequent a specific gas station or eatery – as long as it’s in the right category you’ll get the rewards.

While it’s not an upfront discount like the Target RedCard, the rewards you earn can be applied to your monthly statement, or you can deposit the money you earn into your bank account.

Travel Perks

Regular credit cards can come with other perks, too. If you’re really into travel, your card might help you earn points with your favorite airline or hotel chain. Some cards offer under-the-hood perks like travel insurance or insurance on rental cars when you use the credit card to make your reservation.

Let’s take a look at a real-life travel credit card. The Capital One Venture Card gives you ‘miles’ on every purchase. You can redeem these miles on any airline or hotel purchase. If you make a travel purchase, you’ll currently earn 5x miles for every dollar you spend. Each point is currently valued around $0.02, so you’d be earning $0.10 with each dollar. That’s an incredible 10% back.

Under the hood, the Capital One Venture Card also gives you:

• An effective refund on up to $100 of Global Entry and TSA PreCheck application fees.
• Two visits to Capital One Lounges per year.
• Access to free medical, legal, and travel concierges while you’re away from home.
• Free 24/7 roadside service.
• Free rental car insurance.
• Lost luggage reimbursement.

And the list goes on.

Secured Cards Outside the Store Credit Card Ecosystem

If you don’t have great credit, you can get a secured card outside of the store card ecosystem, too. If you’re not a big Amazon shopper — or you just want to be able to use your secured card places other than Amazon – you could look at an option like the Capital One Quicksilver Secured Cash Rewards card.

This card can be used anywhere Mastercard is accepted. There’s no annual fee, and you even earn at least 1.5% cash back on most purchases. While you have to wait 12 months before you have the opportunity to convert your Amazon secured card to a full-fledged credit card, Capital One only makes you wait six months.

Conclusion about Store Credit Cards

Whichever credit card you choose to use — whether it’s a traditional card or one issued by a retailer – make sure you use it responsibly. Outside of payday loans and a few other predatory products, credit cards are one of the most expensive forms of debt you can take on in terms of APR.

While perks, discounts, and cashback are all nice, banks and stores offer these benefits for a reason. In the end, they’re profiting off of credit cards. Enough people either don’t use them responsibly, or come upon a hardship where they feel they have no other choice, that they end up paying the bank enough collective interest to make up for the costs of giving out free airline miles and 5% discounts.

Credit cards are a useful tool to build credit history or improve your score, but go in with your eyes wide open – especially if you’re applying for a store-issued card.

Pittsburgh-based writer Brynne Conroy is the founder of the Femme Frugality blog and the author of “The Feminist Financial Handbook.” She is a regular contributor to The Penny Hoarder.

The best travel credit cards offer consumers rewards points or miles toward purchases like airfare, hotels and rental cars. Though some carry steep fees, these credit cards typically result in more rewards for frequent travelers than a standard cash back credit card. And they might also come with unique perks like travel insurance, free baggage check and late check-out at hotels.

But with confusing terminology like points vs. miles and an oversaturated market full of general travel cards, airline cards and hotel cards, how can you determine which card offers the right mix of rewards and perks at the right annual fee for you? To help, we’ve compiled a list of the best travel credit cards currently available.

The Best Travel Credit Cards

• Capital One Venture Rewards Credit Card: Best Overall Travel Credit Card
• Chase Sapphire Preferred Card: Best Bonus Program
• Delta SkyMiles Gold American Express Card: Best Airline Credit Card
• Hilton Honors Aspire Card from American Express: Best Hotel Credit Card
• Citi Premier Card: Best for Everyday Purchases
• American Express Gold Card: Best for Foodies
• U.S. Bank Altitude Connect Visa Signature Card: Best for Road Trippers
• The Platinum Card from American Express: Best for Luxury Travel
• Wells Fargo Autograph Card: Best for No Annual Fee
• Chase Ink Business Preferred Credit Card: Best for Business Travelers
• Bank of America Travel Rewards Credit Card for Students: Best for Students
• Credit One Bank Wander Card: Best for Fair Credit Applicants

How We Picked the Best Travel Credit Cards

To select our top 12 best travel cards, we narrowed our focus to a list of 35 travel cards offering strong rewards and bonuses, balanced by justifiable fees. We whittled this list down further to unique cards for each type of traveler.

Here’s the full list of 35 travel cards that we started with, in alphabetical order:

• American Airlines AAdvantage MileUp Mastercard
• American Express Gold Card
• Bank of America Business Advantage Travel Rewards World Mastercard Credit Card
• Bank of America Travel Rewards Credit Card
• Bank of America Travel Rewards Credit Card for Students
• Bilt World Elite Mastercard
• Capital One Spark Miles for Business
• Capital One VentureOne Rewards Credit Card
• Capital One Venture Rewards Credit Card
• Capital One Venture X Rewards Credit Card
• Chase Freedom Unlimited
• Chase Ink Business Preferred Credit Card
• Chase Sapphire Preferred Card
• Chase Sapphire Reserve
• Citi Premier Card
• Credit One Bank Wander Card
• Delta SkyMiles Gold American Express Card
• Delta SkyMiles Reserve American Express Card
• Discover it Miles
• Hilton Honors American Express Surpass Card
• Hilton Honors Aspire Card from American Express
• JetBlue Plus Card
• Marriott Bonvoy Bold Card
• Marriott Bonvoy Boundless Card
• PenFed Pathfinder Rewards Visa Signature Card
• Southwest Rapid Rewards Priority Card
• The Platinum Card from American Express
• TD First Class Visa Signature Credit Card
• United Club Infinite Card
• United Explorer Card
• U.S. Bank Altitude Connect Visa Signature Card
• U.S. Bank Altitude Reserve Visa Infinite Card
• Wells Fargo Autograph Card
• World of Hyatt Credit Card

What Is a Travel Credit Card?

A travel credit card earns rewards that cardholders can apply toward travel purchases, like hotels and airfare. These rewards usually come in the form of points, miles or cash back. The best travel credit cards offer competitive rewards and, usually, a welcome bonus equivalent to several tens of thousands of bonus points.

Though many of the best travel credit cards come with an annual fee (the highest on our list is nearly $700), they can easily pay for themselves if you are a frequent traveler who knows how to take advantage of the perks. In addition to rewards, travel cards typically offer trip insurance. Co-branded travel cards, like airline credit cards and hotel credit cards, may even offer additional perks like lounge access, free checked bags, concierge services, free breakfast and early check-in and late checkout.

How Does a Travel Credit Card Work?

Travel credit cards work similarly to standard credit cards: Swipe them for everyday purchases, then pay them off each month to avoid accruing interest. The difference? Each time you use your credit card, you’ll accumulate points or miles that you can redeem for travel expenses.

How points and miles are valued, how much you accrue with every dollar spent and how you redeem the points or miles all depend on the specific travel card you have and what you’re spending money on. For example, with one card, you might earn a flat rate no matter the purchase while others may offer more points for dining or gas. Basic rewards points usually have a fixed value between 1 and 1.5 cents per point, but airline miles and hotel points are a little more nuanced and can be challenging to track if you’re a beginner.

Types of Travel Credit Cards

Broadly, there are two types of travel cards: general travel credit cards and co-branded travel cards. Co-branded cards include airline credit cards and hotel credit cards.

General Travel Credit Cards

General travel credit card issuers include banks like Capital One, Chase and Citi. Such cards offer rewards that you can redeem more broadly for travel expenses, like a flight, rental car or hotel stay. Airline credit cards and hotel credit cards, on the other hand, require you to redeem your points or miles specifically with their brand.

Because you can more widely use the points accrued on a general travel card, the rewards might not be as competitive as they are with co-branded cards. You may also miss out on brand-specific perks, like free checked bags or room upgrades, that co-branded cards sometimes offer.

General travel cards often come with huge welcome bonuses (also called sign-up bonuses) if you spend a certain amount of money within a set timeframe from account opening. These cards can run the gamut; travel cards with no annual fees typically offer basic travel rewards while those with steeper fees offer higher reward amounts and may come with additional perks.

You can usually redeem these travel credit card points when booking through the card issuer’s website or platform. Alternatively, you can book a flight or hotel directly (or via another third-party application), then use your points as a statement credit after the purchase has gone through.

Some travel card issuers allow you to transfer points to airline and hotel loyalty programs — but this transfer may lower the value of each point. Similarly, you might be able to claim your rewards points as general cash back, but the value of each point will typically be lower when redeemed this way.

Airline Credit Cards

Airline credit cards are a type of co-branded travel credit card. Airlines like Delta, United and American Airlines partner with credit card issuers like American Express to offer these travel cards, which let you earn miles for every dollar spent. Airline credit cards make sense if you are loyal to a specific airline.

Once you’ve accrued enough miles, you can redeem them for future travel with that airline (or other airlines in the same airline alliance). Higher-tier airline credit cards, which fetch a higher annual fee, may come with perks like free baggage check, lounge access, priority boarding and TSA Precheck or Global Entry fee reimbursement.

Delta, United and American all have credit cards, but you can also find credit cards from smaller airlines like JetBlue and Southwest.

Hotel Credit Cards

Hotel credit cards are another form of co-branded travel credit card that instead allow you to earn points toward free nights at a specific hotel chain. That makes these cards most attractive to travelers who are loyal to a specific chain.

In addition to rewards points toward the hotel chain, a hotel credit card might include perks like early check-in and late checkout, free breakfast or even a free night every year. Three of the largest hotel chains to consider are Marriott, Hilton and Wyndham.

What to Look For in a Travel Credit Card

The market is saturated with travel credit cards, so how do you pick the right one? Comparing travel cards requires that you already have an understanding of the perks you want, the annual fee you’re willing to pay and, of course, your credit score. Here are some things to look for:

Annual Fee

If until now, you’ve only had basic cash back rewards credit cards, you may not be used to paying an annual fee for your credit card. While there are options without an annual fee, the best travel credit cards typically come with some kind of fee — at least $95. The more perks and rewards you want, the higher the fee will likely climb.

Before choosing a card with a high annual fee, calculate how much you’ll have to travel to make it worth your while. If you’re not a frequent traveler, a cash back rewards credit card may be the better deal.

Rewards

The main attraction of a travel card is the rewards perks. Look for a card that will offer rewards that you’ll actually use. For example, if you’re a frequent flier, you’ll want a card that rewards regular airfare purchases — with rewards in the form of miles. But if you like to go for road trips, you might prefer a credit card that rewards fuel purchases and can be redeemed as hotel points.

Welcome Bonus

The rewards program is only part of the calculation. You should also pay attention to the sign-up bonus (but be warned — these change frequently). Sometimes, a strong welcome offer can counteract the card’s annual fee for the first year. If you are deciding between two similar travel credit cards, the sign-up bonus can be a good way to break the tie.

Other Perks

Points and miles are hallmarks of travel cards, but you should consider the whole package. Here are some other perks you may want to prioritize when selecting your travel credit card:

• Travel insurance, including lost luggage insurance, trip cancellation insurance, travel accident insurance, trip interruption insurance and even car rental insurance
• Airline perks like lounge access and priority boarding
• Hotel perks like early check-in and free breakfast

International Acceptance

Not all travel cards are created equal. While Mastercard and Visa are widely accepted around the world, travelers may have more trouble with Discover and American Express. If you travel abroad regularly, it’s a good idea to keep a Visa or Mastercard in your wallet. That doesn’t mean you shouldn’t have American Express or Discover but you may want the added security of multiple cards when traveling in a foreign country.

Foreign Transaction Fees

Speaking of traveling abroad, it’s a good idea to look for a credit card that doesn’t charge foreign transaction fees when used outside the country. The best travel credit cards have no such fees, but lower-tier cards that charge up to 3% in foreign transaction fees could still be attractive if you only travel in the U.S.

Minimum Credit Score Requirement

Travel cards pay out tremendous benefits, but they’re not available to everyone. Most credit card issuers require good if not excellent credit to be approved. While credit scores are not the only factor a card issuer will use to determine whether they approve your application, they’re an important consideration. Make sure you have at least the minimum score listed above for each card — but you’ll be more successful if you are on the higher end of the range.

Pros and Cons of Travel Credit Cards

If you have a strong enough credit score to qualify and travel enough to justify the annual fee, a travel card carries a number of advantages. But these cards can have their downsides, too. Weigh the pros and cons before signing on the dotted line:

Alternatives to a Travel Credit Card

If you’re looking for a good rewards credit card but don’t travel enough to justify the annual fee, consider a basic cash back credit card, like the Capital One Quicksilver. Such rewards credit cards offer straightforward cash back — either at a flat rate or at a variable rate depending on your purchase. This makes it easier to redeem your rewards, and the fees are much lower than travel credit cards. In fact, many cash back cards have no annual fees.

Frequently Asked Questions (FAQs) About Travel Credit Cards

We’ve rounded up the answers to the most common questions about travel credit cards to help you decide if this type of card is right for you.

Contributor Timothy Moore is a writer and editor in Cincinnati who covers banks, loans, insurance, travel and automotive topics for The Penny Hoarder.

When it comes to credit cards, keeping on top of your bills is important to maintaining or building good credit. Considering that your payment history makes up a large part of your credit, even one late payment could negatively affect it.

The good news is that the act of paying your credit card bill doesn’t have to be hard. In fact, credit card issuers offer many ways you can submit payment. Let’s take a look at what your options are, and more details about what can happen if you end up making a late payment on your credit card.

Online Payments

Most, if not all, credit card issuers allow you to make credit card payments online.

There are different methods of transferring funds, including:

• Bill pay: Your bank may have this feature, where you use your checking account to transfer money to your credit card. The bank will likely have an autopay feature.
• ACH transfer: Much like bill pay, except you enter your banking details through your credit card issuer’s website. Information you’ll most likely need to include are your bank’s routing number, your account number, and the bank’s contact information.
• Wire transfer: Some credit card companies accept incoming wire transfers, whether that’s through your bank or money transfer services.

Depending on your individual situation, you can choose to pay online in different ways.

Set Up Autopay

Setting automatic payments from your bank account to your credit card each month is an easy way to handle your credit card bill. All you’re technically doing is setting something up, and you can virtually forget it.

To do so, follow the prompts on your credit card issuer’s website and head to the payments section. There, you’ll be able to find options on setting up autopay, including the date and amount you want to pay — it’s typically for the balance in full, the minimum payment due, or a fixed amount you choose.

When it comes to autopay, you still need to monitor your credit card account (we did mention about virtually forgetting automatic payments, not totally forgetting it). Sometimes, a payment may not go through correctly for a myriad of reasons, or there’s a fraudulent transaction you failed to notice on your credit card statement.

In these cases, you may want to consider setting up email or text alerts to let you know when a credit card statement is posted, the credit card’s due date, and when your payment is posted. Don’t forget to check your bank account regularly to ensure you have enough money to cover your monthly payments.

Through the App

If you’re not interested in making automatic payments, you can still make it easier on yourself by paying through your credit card or bank app if that option is available to you. It’s just like how you would do it by logging into your account online through your computer: indicate the amount you want to pay and use the bank account you’ve linked to your credit card account.

On the Phone

Paying your credit card bill over the phone entails giving the same information as you would with online payments, except you’re calling your credit card company instead. Make sure you gather all necessary information beforehand, such as your credit card account number, and banking information for your checking or savings account.

To find the right phone number to call, check the back of your credit card or your credit card statement. While many credit card issuers have a catch-all phone number for their customer service department and will transfer you to the right representatives, you can also consider digging around their website to see if there’s one specifically for credit card payments.

Pay in Person

You may be able to pay your credit card bill in person if your credit card issuing bank has brick and mortar locations or ATMs that will accept credit card payments. To do so, bring a copy of your credit card statement along with a method of payment and either speak with a representative, or follow the prompts on the ATM. In some cases, you can pay cash, but that’s not always the case.

Mail in Your Payment

Credit card statements usually have a section in which you can tear off a payment slip to pay by mail. On this pay slip it’ll have your account number and you can indicate the amount you want to pay. You can find the address to mail the payment to on your credit card statement.

Credit card issuers most likely won’t accept cash in the mail, but they do accept paper checks, and ACH information (if there is an option for that on the payment slip. If you receive paper statements, you may receive an envelope in which you can mail your payment.

What Happens If You Pay Credit Card Bills Late?

Paying a credit card late will cost you money. It will start with a late fee charged by the issuer and that is usually a flat fee that is outlined in the terms of the credit card. If payment continues unpaid, the issuer may increase your APR and also freeze the card so it can’t be used. Eventually, the bill will be turned over to a collection agency and this will affect your credit score.

But life happens. Sometimes you’re juggling so much that you end up forgetting about your credit card bill, or you make a payment that isn’t received by the credit card issuer by the due date. If that happens, your credit card issuer may charge you a late fee.

For late payments after a certain length of time, credit card issuers may start charging you a penalty APR, which is higher than your regular APR.  Meaning, you could end up paying more in interest if you’re late on your payment.

Another consequence of late payments is that your credit score could be negatively affected. As mentioned earlier, payment history makes up around a third of credit scores. So your credit card company could report the late payment to the credit bureaus and lower your score.

To ensure late payments don’t happen, it’s important to take care of payments right away. That means understanding your credit card issuers billing cycle and when yours ends, which is usually between 20 and 45 days.

Once it’s the end of the billing cycle, you’ll get a statement in the method you choose, whether that’s electronically or by mail.

According to the law, credit card companies have to give their customers a minimum of 21 days between when the statement is given out and at least the minimum payment is due. The idea here is to give you enough time to decide on your method of payment and to pay part or all of your credit card balance.

Depending on how you pay and the time you make a payment, the credit card issuer will credit and post the amount to your account either the same or next business day when it receives the funds.

To ensure your credit card payment arrives on time, check to see when you should receive your credit card statement and what your approximate due date will be — it’s usually around the same time each month.

After reviewing your statement and ensuring there are no fraudulent transactions, submit your payment well before the due date so it increases the chances of the transaction being posted. You can also consider using a faster form or payment. In most cases, online bill payment or ACH transfers take the fastest, whereas mail payments tend to take the longest.

Frequently Asked Questions (FAQ) About How to Pay Credit Card Bills

We’ve rounded up the answers to the most frequently asked questions about how to pay credit card bills.

Contributor Sarah Li-Cain is a personal finance writer based in Jacksonville, Florida, specializing in real estate, insurance, banking, loans and credit. She is the host of the Buzzsprout and Beyond the Dollar podcasts.