Traveling internationally presents its own set of challenges and considerations not the least of which is what type of rewards credit card to carry with you. All rewards cards come with their own perks and benefits but when you’re traveling abroad there are some important features which you should definitely look for.
1) Waived foreign transaction fees
Foreign transaction fees routinely add 2%-3% on every purchase made outside of the U.S. so avoiding them should be priority #1. Since transactions while traveling often include big-ticket payments for hotels, airline tickets, and rental cars, it makes sense to have a credit card which waives these fees.
2) Chip and (PIN) technology
Credit cards in the U.S. are currently undergoing the transition to Smart Chip technology but this enhanced security system has long been in use throughout the rest of the world. Simply put, credit cards are embedded with chips and the cardholder must enter a PIN or sign for each transaction. The CHIP and PIN technology is the most secure since hackers would have to have the information from the magnetic strip as well as the cardholders Personal Identification Number. Many chip-enable cards in the U.S. use the Chip and Signature method which is similar but doesn’t require the use of a PIN. Most European retailers accept Chip and Signature cards. However, it’s getting more and more difficult to use a regular swipe-type credit card outside of the U.S.
3) Trip interruption and/or cancellation insurance
Benefits differ from card to card but this feature basically reimburses you up to a certain amount if your trip is cancelled or interrupted for a covered reason. Given all the vagarities associated with international travel, this is a great feature to have.
4) Delayed/Lost luggage
Again, each rewards credit card comes with its own limitations and exclusions but typically if your luggage is delayed over a certain amount of time you will be reimbursed for essential purchases such as clothing and toiletries until you are reunited with your luggage. For luggage that is lost, there is usually a per person maximum amount given.
5) Purchase protection
The specifics of purchase protection benefits vary but most cards offer a certain amount of coverage per item (for example, $10,000) up to a maximum amount per year (i.e. $50,000). Generally, cardholders have 120 days from the date of purchase to file a claim for theft or damage. This coverage extends to purchases made while traveling abroad.