the wander project dispatches from over there

Traveling is expensive. If you’re not careful, you’ll end up dropping even more cash just for the privilege of spending your own money. Short of carrying a backpack full of bills around the world (not recommended), you’ll pay to play when you want to access your funds— the trick is to shell out as little as possible.

Debit Cards:
That $2 ATM charge from a random ATM is annoying at home. Abroad, you can add another $3-$5, then up to 5% for a “foreign currency conversion charge.” Gonna swipe your card?  You’ll pay the conversion charge then, too. Clearly, the 40 bucks you need can easily end up putting a much larger dent in your bank account. Charles Schwab, HSBC and Bank of America offer debit accounts with decent overseas rates, either by charging a low fee or reimbursing you for any fees you incur. Read the (ever-changing) fine print to figure out the one that works best for you; Bank of America, for instance, will slap you with a five dollar fee and a five percent conversion charge UNLESS you’re using one of their network ATMS, which also includes several popular European banks like BNP Paribas and Barclays. If you’re sticking to the U.S. and Western Europe, it’s easy enough to track down one of these and access your money for free.

Credit Cards:
On top of the hefty interest you’re already paying to use someone else’s money, you’ll be charged anywhere from 1-5% as a currency conversion fee. As with debit cards, you should read the tiny type before you sign. At the moment, though, travelers will be hard pressed to find a better deal than Capital One’s Venture Card, which charges no currency conversion fee and offers reward points for every dollar you spend.

Once you’ve picked your plastic, you’ll need a strategy that will allow you to access your funds quickly, safely, and whenever you need it.

Pay with your credit card
Why? Because the foreign charge fees (see above) are usually cheaper than using your debit card, and it’s much safer than carrying a ton of cash. Also, you’re not liable for bogus charges on your credit card, but once money’s been taken from your debit account, it’ll take some work to get it back (the bank will investigate, which takes time…). But don’t run up a ton of debt— be sure to transfer money from your checking and/or savings before you get hit with interest.

Use your debit card to get cash
Depending on where you’re traveling, swiping your Visa for every purchase may not be an option— you’ll need cash.  Don’t bother swapping currency when you arrive in a new country; try to monitor your spending so that you’ve got no cash left to exchange. ATMs almost always offer better exchange rates than the booths at the airport/train station (and even the black-market exchangers on the street).

Double Up
You’ll need two of everything— two credit cards and two debit cards— and they should be from different providers (in case one isn’t accepted). Keep each set in a different place in case of loss or theft, and keep your funds divided between the two debit accounts.

Let your bank know about your travels
If your permanent address is Stateside (or wherever) and charges show up from halfway around the world, there’s  a chance your bank will freeze your account. Prevention is simple: just let your bank know where you’ll be.

What are your tips/tricks for managing your money on the road? Do you have a favorite credit or debit card? What about a bank or online savings account? Let your fellow travelers know!

photo: andresrueda