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Searching for a credit card to suit your travel plans can be an overwhelming task. There’s an extensive range of credit card types available and numerous lenders to suit most purposes.
However, understanding all the implications and requirements to correctly use a credit card can mean that choosing the right option is difficult.
Most people own a debit card for access to their bank accounts for money they’ve put into the accounts, but to encourage customers to use credit cards which feature interest and the possibility of charges to the lender, they commonly come with great benefits.
Choosing the best credit card for travel purposes that suits your current life situation is not impossible. Here is what to look for with the different credit card options which might be available.
Awareness of your credit score is very important before you consider applying for a credit card. A credit score is based on your previous loan history, repayment reliability and various other statistics which are taken into account to determine whether a lender will offer financial support via a specific account.
Possessing a low credit score could hinder your chances of being accepted and being declined will only negatively affect your credit score further.
If you have a low credit score, then you need to develop a plan to increase your score. Being aware of this situation will allow you to correctly identify the best ways to improve your credit score from lenders who are more generous towards lower credit scores to store credit which allow you to prove you’re a reliable customer.
An alternative method is through secured credit cards, these accounts require money to be deposited prior to spending but even though you’re not being lent money, do count towards your credit score.
Following the assessment of your credit score and reviewing possibilities to enhance the rating if required. There are a few considerations to factor when deciding which credit card will be most suitable for your travel requirements.
International transaction fees – Utilising a credit card abroad might be beneficial when you receive either a better exchange rate, enhanced security over your money or zero/low fees for making a payment abroad.
If international transaction fees apply, then you must monitor the amount per a transaction as even small purchases might incur a standard minimum transaction fee. Therefore, ensure that the options you’re considering have this benefit and it’s applicable to where you’re going to travel.
Annual fees – Dependent on the duration you expect to use the credit card can vary on the application of annual fees. Some credit cards come with annual costs to have the accounts but therefore will feature additional benefits such as insurances or a better interest rate.
These benefits might reduce the expenditure elsewhere if they are covered within the credit card account. Credit cards also provide further security if you require to obtain a refund on a payment as banks have a thorough process to chase the refund. This is separate from previous payment protection schemes and an internal process.
The more you use card payments lends itself with a heightened risk of encountering fraud, especially when travelling. Luckily, most credit cards come with insurances and protection against fraud.
These lenders commonly request details about when to expect payments to be taken so if irregular payments are taken, they can temporarily disable the account to prevent large sums being taken whilst abroad.
The best preparation to ensure that you get the best travel credit card options and to reap the benefits aimed to make the best travel experience is to always be conscious of the repayment interest which could be associated with purchases to ensure that you’re always within your budget to make full monthly repayments.
Finally, being aware of the condition of your credit score will be beneficial in the long run as failure to make repayment will affect the likelihood of being accepted for further credit in the future by any lender.