With summer vacations knocking at your door, plans must be underway for a holiday. In the excitement of packing your bags for a fun-filled vacation, do not forget to plan your money needs for this travel. Foreign travel needs you to have local currency for a comfortable visit. There are various ways for you to carry your money abroad in a safe, hassle-free manner. You should select these options after factoring in the associated charges including currency fluctuation. Carrying cash is a good option, but considering risks like burglary or mugging, you could consider other, safer options.
Prepaid Forex Card
A prepaid forex card is akin to a pre-paid cash card, offering the same level of ease and flexibility. You can book it online or get one from your bank, top it up with the desired amount and get it delivered to your doorstep. It comes with low forex charges, and your currency is purchased at one price point. This saves you from currency fluctuations as well as conversion charges. While buying one for yourself do check the features they offer as some forex cards may assist you with emergency cash, provide you complementary insurance cover and other exclusive travel and accommodation offers. What more? This prepaid can be used for multi-currency transaction and can be topped up easily in case of shortage of funds.
Your Regular Credit Card
A credit card gives you the freedom to roam anywhere cash-less. However, before you fly out, do check with your credit card company if the card is cleared for transactions in the country you’re visiting. If it isn’t, request your credit card company to enable international use. You will have to pay a foreign transaction fee while using the card abroad. The fee varies from company to company, and country to country. Do read the terms and conditions of a credit card before applying for one to understand the foreign transaction fee. Also, make yourself aware about the currency conversion fee too, which is not charged by the card company but is assessed by the payment processor of the card. Depending on the country, you usually end up paying 1% of the currency conversion fee.
International & Travel Credit Cards
Besides your regular credit card, you can also opt for international credit card while travelling abroad. Tailored for overseas use, these cards can provide benefits that are useful to travelers – free airport lounge access, travel insurance, concierge service, travel and lifestyle rewards and deals, and accelerated airmiles that you can exchange for tickets.
You can use your debit card the same way you use them for domestic transactions. But do check if your debit card qualifies to be used internationally. A debit card would not provide you the facility of buy now and pay later like a credit card, but will use funds available in your bank account. However, you can ask your bank to cap your spends to protect you against frauds. You will have to pay conversion fee when you use it for transactions in foreign country or withdrawing money.
While all the options discussed above rule over cash owing to easy handling and safety issues, it is advisable to carry some of cash during your overseas travel. Carrying cash may help you in remote areas of any country where electronic transactions may not be common. Be cautious, of course, while carrying cash since it’s easy to lose. Ideally, divide your cash in smaller wallets. In case you lose one wallet, there can be others for you to fall back on.
It’s always better to have multiple options to have a breezy vacation overseas. Do carry a little cash while having a multiple-currency travel card and you will be sorted.
The writer is CEO, BankBazaar.com