When you travel, there are certain things you should consider when deciding which credit cards you should take with you on your trip. For international travel, such as to Europe, there are a few different things you should consider. For example:
- Which payment network -- Visa, MasterCard, American Express, or Discover?
- Does the card have foreign transaction fees?
- Does the card have good travel rewards, perks, or an introductory bonus?
This isn't an exhaustive list, and there are certainly other factors that could be important to you. Having said that, let's take a closer look at the three major considerations listed here, as they can help the majority of consumers decide which cards are best.
Visa, MasterCard, American Express, or Discover?
The short answer is that Visa and MasterCard credit cards are generally the better choice when traveling abroad.
While many smaller businesses in Europe don't accept card payments at all, among those that do, Visa and MasterCard have nearly universal acceptance. American Express cards are accepted at many places throughout Europe, especially at international hotel chains, in major cities, or other locations frequented by travelers, but AmEx isn't as widely accepted in Europe as it is in the United States.
If an American Express credit card is your personal favorite, in terms of rewards or other benefits, bring it on your trip -- just be sure that you have a Visa or MasterCard credit card for situations where AmEx isn't accepted.
Discover cards are even worse for foreign travel. Simply put, Discover cards are not widely accepted in foreign countries. While Discover's credit card products have some excellent reward programs and don't have any foreign transaction fees, they're best reserved for domestic use.
Foreign transaction fees
If you don't have much experience traveling outside the U.S., you may not be aware that many credit cards charge foreign transaction fees if you use them for any international purchases.
Foreign transaction fees can vary depending on the credit card issuer and the particular credit card product, but a 3% fee is rather common. That means that for every $100 you charge overseas, an additional $3 will be tacked on to your bill. As you can probably imagine, for a long European vacation where you're spending thousands of dollars, this can certainly add up.
The good news is that most major credit card issuers offer at least one credit card product that doesn't charge a foreign transaction fee. As of this writing, none of Capital One's credit cards charge foreign transaction fees, which is why the company's products regularly appear on our list of the best travel credit cards. Several cards issued by American Express, Barclaycard, Chase, and Citibank also have no foreign transaction fees, especially those that are co-branded airline and hotel credit cards.
Travel rewards, perks, and introductory offers
Competition among credit card issuers has never been higher than it is now. This situation has resulted in some of the best credit card reward programs, perks, and introductory offers that there have ever been.
For example, there are many credit cards that earn cash back or miles at a 2% rate on all purchases, which was unheard of until a few years ago. Others offer excellent travel-specific perks, such as baggage insurance, airline incidental reimbursement, free TSA Pre-Check, and more.
As far as introductory offers go, many credit cards offer new cardholders lucrative sign-up bonuses after spending a minimum amount. Others offer 0% intro APR periods of as long as 21 months, which can save you lots of money if you're planning to charge most of your expenses on your trip and pay them off gradually.
The Foolish bottom line
In a nutshell, there's no perfect travel card for everyone, although there are some that are better suited to European travel than others. Your goal should be to find a credit card that will be accepted everywhere you'll need to use it, doesn't charge foreign transaction fees, and has the perks and rewards that matter to you the most.