Traveling abroad and paying for everything has gotten a lot easier over the past 10 years. I’ve never had the pleasure of using a travelers check but I hear they were quite the adventure. Nowadays though, when I travel abroad I take two debit cards, two credit cards and a couple hundred dollars in cash. There are a lot of things to worry about when you’re traveling but how to spend your money shouldn’t be one of them.
I’ve traveled to over 20 countries on 3 different continents and found that the best way to access my money is through ATM’s and credit cards. ATM’s are ubiquitous in almost all countries and you will often receive the best exchange rate going this route. And although ATM’s are convenient, I prefer using a credit card for large purchases like train tickets or expensive meals and souvenirs. Every bank and every country is different but using this standard approach should save you some money and remove a lot of the hassle.
I haven’t been to Europe in a few years but I’ve heard that some vendors only accept ‘chip’ credit cards. Most American credit cards don’t have this chip so you may want to inquire with your bank about getting one. Personally, I’ll take my chances with my regular cards because I always have my ATM cards as back-ups. When I travelled all over Eastern and Western Europe in 2007-2008, my ATM card and credit cards worked just fine.
On my most recent trip abroad(to Japan), I was able to use my ATM card without ever getting charged a fee. It seems like in non-US countries it’s customary for the ATM owner not to charge you a fee(but your bank might). I’m planning a trip to Turkey and the UAE and I’m curious to see what type of cards work best there. I know that you can actually pay for certain things in USD in Turkey so cash might come in handy there. But the UAE is probably a different story since it is a much more modernized city. I would expect my credit cards to be accepted more frequently there than somewhere like Turkey.
I like to take two ATM cards because often they will be linked to different networks(Cirrus, Plus, Maestro, etc). Each network has hundreds of thousands of ATM’s worldwide and you may find that one network works better than another. The biggest advantage about exchanging money through an ATM is the exchange rate. You will receive the wholesale exchange rate which will always be better than currency change kiosks or sometimes even the banks. Here are some helpful tips for getting your money out of the ATM machines:
- Calling your bank ahead of time to let them know you’ll be traveling doesn’t always work. Instead, carry your bank’s international phone number if problems arise abroad.
- Sign up with a bank like Ally or ING that doesn’t charge any ATM fees(I sincerely hope none of my readers are still paying ATM fees!).
- Don’t worry about finding ATM’s. They are everywhere!
Credit Card Tips
Credit cards provide the most safety when you’re traveling abroad since you’re never liable for unauthorized purchases. It’s a lot more difficult to challenge an ATM transaction.
You will generally receive the wholesale exchange rate with credit cards too but watch out for the foreign exchange fee. I have a lot of credit cards and I know that a few of my premier cards have no foreign transaction fee but it’s around 3% for the others. Although your purchase will be offset by rewards points, the fees can really add up if you’re spending a lot. Here are some helpful tips for using credit cards abroad:
- Visa is king, Mastercard is a close second and AMEX is last when it comes to who will accept what card.
- Don’t use your credit card to withdraw cash from an ATM.
- Bring a back-up card of different branding(i.e. Visa and Mastercard).
- Instead of worrying about keeping your card in plain sight at all times, just stop by an internet cafe every few days and check your transactions. You’ll never be held responsible for unauthorized activity, whether you’re in the US or a foreign country.
Readers, how do you pay for things abroad? I’ve never encountered a merchant that wouldn’t take my card because it didn’t have a chip or a PIN, have you?
-Harry @ PF Pro