Happy family in airport gets ready to travel

What is a Travel Miles Credit Card and How Does it Work?

Published March 9, 2022
7 min read

If you travel regularly, you might benefit from one of today’s best travel credit cards. A travel miles credit card offers rewards on all qualifying purchases, giving you the opportunity to redeem those rewards for future travel expenses.

Many travel credit cards offer rewards in the form of miles, points, or statement credits that you can use to pay for travel. Other travel credit cards offer rewards that are specific to an airline or hotel brand. Because of that, people often apply for more than one travel credit card and use the combined rewards to increase their benefits.

What is a travel credit card? How do travel rewards credit cards work? Here’s how to earn and redeem rewards with today’s best travel miles credit cards.

How different types of travel rewards and miles credit cards work

How do travel credit cards work? The best travel rewards cards give cardholders the opportunity to earn points and miles on every purchase. These rewards can be redeemed for statement credits, travel bookings, and more depending on the card.

Here’s a quick overview of the four most common types of travel rewards and miles credit cards:

General travel rewards credit cards

Many of today’s top travel credit cards are not tied to a specific travel provider. Instead, these travel cards allow cardholders to earn points to redeem for statement credits, book travel through the card issuer’s website or—in some cases—transfer to different airline or hotel loyalty programs.

The Discover it® Miles credit card, for example, earns unlimited 1.5x Miles for every dollar spent on all purchases — from airfare and hotels to groceries and online shopping. While some travel miles credit cards only allow you to redeem your rewards for travel expenses, the Discover it Miles card lets you redeem the miles you earn as a statement credit for recent travel purchases,1 cash, or at checkout with Amazon.com2 and when you pay using PayPal.3

What’s the best credit card for travel miles? For some consumers, a general travel rewards credit card like the Discover it Miles card can provide them with a flexible way to earn and redeem rewards. Other consumers may prefer a more specialized travel credit card, such as an airline credit card or a hotel credit card.

Airline miles rewards credit cards

Airline miles credit cards, which are tied to a specific airline, allow you to earn miles that you can redeem for flights with that airline. Many people like airline credit cards because they can combine the miles they earn while flying with the miles they earn by using their airline credit card to book the flight. Some airline credit cards allow cardholders to access elite airline status levels more quickly, and nearly all airline cards offer benefits like free checked bags and discounts on in-flight purchases.

Hotel travel rewards credit cards

Like airline credit cards, hotel travel rewards credit cards allow you to earn rewards that can be redeemed within a specific hotel brand. Hotel credit cards often reward extra points when you use your hotel card to purchase stays with one of the brand’s properties, and you can combine these points with rewards you earn as a brand loyalty member. Points can be redeemed for hotel stays, and cardholders are often rewarded with additional perks such as complimentary room upgrades and extended checkout times.

Train rewards credit cards

Want a train rewards credit card? Frequent train travelers can apply for co-branded cards that allow cardholders to earn points towards travel on train lines.

Is a no annual fee travel credit card best for you?

While no annual fee travel credit cards generally earn fewer miles per purchase than annual fee travel cards, you can still get a lot of value out of a no annual fee travel card. No fee travel credit cards give cardholders the benefits of a top travel miles credit card without the costs of an annual fee.

General no annual fee travel rewards cards

What is the best credit card for travel miles if you don’t travel very often? For occasional travelers, a no annual fee travel rewards card that offers flexible earning and redemption options, like the Discover it Miles card, may be a good choice. It lets you enjoy the benefits of a travel credit card without having to pay an annual fee.

Co-branded no annual fee travel rewards cards

Many airlines and hotels offer cardholders a choice between a no annual fee credit card and an upgraded card with an annual fee. Before choosing the option that’s best for you, check each card’s rewards structure against your current spending habits. If you regularly travel with a preferred airline or hotel, a co-branded annual fee card could offer extra points and benefits that might save you money in the long run.

Choosing the best travel credit card benefits for you

Now that you know what a travel credit card is and how travel rewards credit cards work, it’s time to look at how to choose the best travel credit card.

If you want to know which travel credit card is likely to give you the best value, start by taking a look at how much you spend on travel.

If you take one or two trips every year, for example, you might benefit from a general travel credit card like the Discover it Miles card — especially if the credit card  provides you with flexible redemption options. If you are a frequent flyer, you might want to look into a travel credit card that allows you to earn rewards on a specific airline.

Here are a few other factors to consider when you’re deciding which travel credit card is best for you:

New cardmember bonus

Nearly all travel credit cards give new cardmembers the opportunity to earn bonus points or miles. In some cases, you may need to meet a spending requirement before earning your bonus—which is why it’s a good idea to make sure the spending requirement fits your budget before applying for the card.

The Discover it Miles card offers new cardmembers a unique opportunity to earn bonus Miles. With Discover Match®, Discover will match all of the miles that a new cardholder earns at the end of their first year.4 This gives you the opportunity to earn bonus rewards as a new cardmember no matter how much you spend.

Foreign transaction fee

Some credit cards charge foreign transaction fees any time you make purchases outside of the United States. If you plan on traveling internationally, look for a travel credit card that doesn’t come with foreign transaction fees.

Trip cancellation or delay insurance

Some travel credit cards offer trip cancellation or delay insurance. To evaluate a travel credit card’s insurance package, compare the costs and benefits against other types of travel insurance available to you from an airline or an independent insurance provider. Be sure to read the travel credit card’s terms to determine if the card provides this type of insurance.

Airport security screening benefits

Several travel credit cards offer statement credits towards the cost of applying for airport screening benefits, which offer members expedited security screening options at many major airports. Again, you should reference the travel credit card terms to confirm the card provides these benefits.

Extra travel benefits

Many airline and hotel credit cards offer cardholders extra benefits and perks like early boarding, late checkout and complimentary upgrades. Make sure you consider all of the available benefits before choosing the best travel credit card for you.

Will using more than one travel credit card work best for you?

Many people use more than one travel credit card. By carrying both a general travel miles credit card and a co-branded hotel or airline credit card, you can get the perks that come with your favorite hotel or airline’s credit card—such as free checked bags or fast-track elite status—while having the option of using a general travel card for other travel purchases. If your general travel card allows you to transfer your rewards to your favorite hotel or airline’s loyalty program, that might be even better.

Are travel credit cards worth it?

Travel credit cards are a good choice if the rewards, points, or miles you earn can be redeemed for travel that’s worth more than what you could have earned from a cash back credit card. Before deciding whether a travel credit card is right for you, do the math on where your money is currently going—and ask yourself whether you could benefit from earning rewards that could be put towards future travel expenses.

Do you need a credit card to travel? Not necessarily. However, once you understand how a travel miles credit card works, you’ll know exactly how you can benefit from adding a top travel credit card to your wallet. Keep that in mind as you book your next trip.

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