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Update: Chase Freedom Flex℠ no longer earn 7% cashback on dining purchases. However, it might still make sense for you to use this card overseas if the current Chase Freedom® 5x categories align with your international purchases.
Foreign transaction fees can be an obnoxious part of international travel. No one likes to pay an additional ~3% on every transaction just for using a credit card to pay a merchant located outside the United States. Thankfully, there are many cards with no foreign transaction fees — and I have literally dozens such cards.
But this week, I intentionally used a credit card that charged a 3% foreign transaction fee instead of one of the cards in my wallet with no foreign transaction fees. Here's the short story of why.
Page Contents
What's In My Wallet
At the start of each quarter, I review the cards with rotating bonus categories to determine what should be in my everyday wallet along with my Charles Schwab debit card. Here's what made the cut for the April-June 2024 quarter.
Everyday spending card: The World of Hyatt Credit Card
Ideally, I'll be putting most of my everyday spending on a card where I'm trying to earn a welcome bonus. As a backup, my wife and I spend on her World of Hyatt Card to work toward a Category 1-4 Hyatt free night — plus six Hyatt Elite Night Credits — for spending $15,000 in a calendar year.
Travel card: Ink Business Preferred® Credit Card
I've written an entire article about why the Ink Preferred is my go-to card for everyday travel purchases. And since my wife and I travel the world nonstop as digital nomads, we make quite a few travel purchases. Whether buying public transit or paying taxes and fees on award bookings, I always want this card nearby.
Grocery card: Citi Strata Premier℠ Card
Although better known for its other bonus categories, I'm carrying the Citi Strata Premier as my grocery card from April 1 to June 30, 2024. However, it can be a great fallback for several other categories as the card earns 10X points per $1 on hotels, car rentals, and attractions booked through CitiTravel.com; 3X points per $1 spent on airfare and other hotels; and 3X points at gas stations, EV charging stations, restaurants, and supermarkets.
- 3X points per $1 on airfare and hotels and at gas stations, restaurants, and supermarkets
- Annual Hotel Benefit: Save $100 off a single hotel stay of $500 or more (excluding taxes and fees) when you book through CitiTravel.com
- No foreign transaction fees
- $95 annual fee
- 10X points per $1 on hotels, car rentals, and attractions booked through CitiTravel.com
- 3X points per $1 spent on airfare, and other hotel purchases
- 3X points per $1 spent at gas and EV charging stations
- 3X points per $1 spent on dining at restaurants, including cafes, bars and lounges
- 3X points per $1 spent at supermarkets
- 1X points per $1 spent on all other purchases
Gas: Wyndham Rewards® Earner℠ Business Card
The Wyndham Earner Business Card is the hands-down best credit card for gas. This card earns a whopping 8X points on gas purchases, making it an easy go-to for gas purchases — whether that's in rental cars or the RV that my wife and I purchased during the pandemic and still live in between trips.
Dining: Chase Freedom Flex℠
That's right. Despite still having the no-longer-available Citi Prestige® Card — a $495 annual fee card that earns 5X Citi ThankYou points at restaurants — a $0-annual-fee card has taken the dining slot in my wallet from April-June 2024. That's because one of the 5% Chase Freedom Flex‘s rotating bonus categories for Q2 2024 is dining.
This bonus works a bit differently than others. That's because the Freedom Flex already earns 3% on dining purchases. So, this bonus is applied as a 4% bonus, meaning the Freedom Flex earns a whopping 7% cash back on dining purchases.
Even better, since I have the Chase Sapphire Preferred® Card, I can combine points between my Chase accounts to effectively earn 7X Ultimate Rewards points on dining purchases.
Also, you might see where this is going… The Freedom Flex charges a foreign transaction fee of 3% of each transaction in U.S. dollars.
Why I Used My Freedom Flex Overseas
When it was time to make my first restaurant purchase after arriving in Europe, I looked in my wallet to find just two cards that earned more than 1X points:
- Freedom Flex: 7% on dining during Q2 2024
- Citi Strata Premier: 3X points on dining
If it were simply a choice between 4% net cash back (7% earning less 3% foreign transaction fee) vs. 3X ThankYou Points, the Citi Strata Premier would be the clear winner. After all, Citi ThankYou points have provided 2.19¢ per point in value in recent AwardWallet user redemptions.
However, since I have the Sapphire Preferred, the 7% cash back earnings can be converted to 7X Chase Ultimate Rewards points. And Chase points have been redeemed for an average 1.95¢ per point in recent AwardWallet user redemptions.
Even after factoring in the 3% foreign transaction fee, the net earnings of using the Freedom Flex beat the potential earnings of using the Citi Strata Premier — at least this quarter.
So, that's why I pulled out the Freedom Flex to pay for an authentic Japanese ramen dinner in Barcelona:
Bottom Line
Paying foreign transaction fees never makes sense — or at least that's what I thought before encountering this situation. I never thought I'd intentionally use a card that charges a foreign transaction fee when I had access to several cards that don't charge this fee. But it seems I stumbled into the rare case when the net earnings were so good that it actually made sense to pay this fee.
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