Safe Spending Tips for International Travel

Between airfare, hotels and excursions, any kind of vacation can take its toll on your bank account. When you travel abroad, you also have the question of how you’ll pay for things once you get to your destination, as your American dollars and credit cards likely won’t work in the same way once you’re overseas. Learn how to make international memories without losing out to foreign fees with these tips for what you should do before, during and after your trip.


Before You Leave


Notify your bank


Your first financial step when planning a trip abroad is to tell your bank where you’ll be. If you don’t, you risk having your cards frozen and losing access to your funds. You can do this by calling your bank, or some banks also offer an online notification option.

Choose your spending weapon(s)


Your main options for international spending will be the same as in the United States—cash or plastic. Traveler’s checks, while once widely used, generally are no longer a good option for international travel. While this isn’t true for every country, for many places, the exchange rate for traveler’s checks are often not as good as those you’ll get from an ATM or from using a card. These higher rates can add up, especially when you consider that both issuers and merchants or banks can also charge transaction fees. Even worse, traveler’s checks are becoming less accepted by foreign merchants, so you could find yourself without access to funds. Before deciding to use this type of foreign currency, you should make sure that the place you’re traveling will accept traveler’s checks and that you’re willing to accept the hassle that may come with them.


If you choose to use a credit card overseas, you’ll have to think of the possible foreign transaction fees as well as the accessibility of use. You’ll want to look into the foreign transaction rates offered by your current card and see if you are eligible for one of the many cards that offer zero foreign transaction fees. You should also consider if where you’re traveling will accept an American card (or any type of credit card), which uses different technology than cards in many other parts of the world.


If you decide to rely on cash, you can choose to exchange through a bank or currency exchange, or simply use a foreign ATM to withdraw cash directly. It’s important to be mindful of the exchange rate when choosing any of these options. If you’re planning to use an ATM, your safest bet is to bring either a Visa or MasterCard with you, as they have the largest ATM networks.


Your payment of choice while you travel will all depend on your destination—both the accessibility to funds you’ll have while there and the security (or lack thereof) of your surroundings. Obviously some forms of payment, such as a credit card, are more secure than carrying large amounts of cash if you’re traveling to an area where theft is common.


Know the exchange rate


Before traveling, you should have a clear idea of the exchange rate where you’re traveling, and you should practice doing some conversions in your head. Otherwise, you’ll have no idea how much you’re spending or if a currency exchange is ripping you off. Keep in mind that you’ll also have to withdraw money from a foreign ATM in the foreign currency, so you need to know the exchange rate to be able to withdraw a reasonable amount.


Survey the landscape


It’s likely you’ve researched the culture, climate and best tourist spots of your destination, but you should take some time to read the money section of your guidebook as well. This can help you decide what form of payment you can safely rely on as well as teach you about things like theft rates and money customs such as tipping.


Arrive with cash on hand


It’s important to have access to some form of foreign currency when you arrive so at the very least you can pay for a cab and a snack on the way to your hotel. Most U.S. banks can get foreign currency (depending on the country) within a few days, so you can exchange at your home bank or you can look ahead to see your options for ATMs at the airport when you arrive. Most banks will have maps on their websites that show you where you’ll have ATM access when abroad.


Expect the unexpected


In case a card is lost or stolen while you’re abroad, you should make sure you have your bank’s international, toll-free number on hand to cancel or request a replacement card if necessary. You should also consider bringing a backup card and storing it in a secure place, such as your hotel safe, as replacement cards can take from five to seven days to reach you.


While You’re Abroad


ATM tips


ATMs generally offer the best exchange rate when compared to cash exchanges or traveler’s checks. However, you’ll likely be charged a flat fee by your bank (generally $2–$5) for using a foreign ATM, so it can help to make large withdrawals to limit your ATM visits. Try to use an ATM close to your hotel if possible, so you can store most of the cash in your hotel safe and keep only the amount you need for the day on you. Withdrawals from a foreign ATM will be dispensed in the local currency but debited from your account in dollars. Keep in mind that most countries use a four-digit numeric pin, so if you have a six-digit or alphanumeric pin, you should speak to your bank about switching it before you travel.


Keep in mind that the same safety concerns you have with a U.S. ATM should also be concerns with foreign ATMs—you should only use bank-affiliated machines to avoid fraudulent practices, such as ATMs that will copy your pin or card numbers to steal from your account.


Avoid airport exchanges


Thinking of making a quick exchange at the airport before you get on the plane? Think again. Airport currency exchanges often have much higher exchange rates and commission fees than a normal currency exchange. Why? Because they can. They know soon-to-be tourists have waited until the last minute and need to convert their cash quickly, so people are willing to pay the exorbitantly high fees. Don’t play into their game—exchange beforehand or wait to use a foreign ATM.


Divide and conquer


If you’re traveling with someone else, consider splitting up your money between the two of you, so if one of your wallets is lost or stolen, you still have some cash.


Dynamic currency conversion


Some merchants will offer to convert your transaction into dollars so you can see exactly how much you’re paying. While this may seem like a helpful offer, this practice (called dynamic currency conversion) gives merchants the opportunity to decide the exchange rate, and they’ll often make it higher than it needs to be to gain more of a profit. You should try to avoid being billed in dollars until you’re back in the United States.


Be on guard


Even if you’re in a relatively safe area, remember that pickpockets and other criminals tend to target tourists, so you should take extra caution. Popular international destinations like Barcelona, Rome and Paris are notorious for pickpockets, so you should carry only the money that you’ll need with you for the day. By keeping at least some money or credit cards in your hotel safe, you can ensure that you’ll have access to funds even in the case of a theft.  


Before Returning to the United States  


When you’re ready to return to the United States, you should try to plan so that you use up most of your foreign cash before heading home—this way you don’t need to pay another exchange fee to convert money back to dollars. In addition, U.S. banks won’t exchange foreign coins, so you should be sure to at least use up all of your coinage before returning. If not, you can always save it for your next visit.

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