Travelling is often a once-in-a-lifetime experience, and many of us would prefer not to penny pinch while enjoying ourselves in a new and exciting location. It can be hard to resist spending money on everything you see, especially good quality food and souvenirs for our loved ones. However, if you don’t keep an eye on your spending, you may incur some added fees added while using your card abroad. These are called foreign transaction fees, and they can easily burn a hole in your wallet. However, avoiding foreign transaction fees is not impossible, and this post will tell you exactly how to do it.
What Is a Foreign Transaction Fee?
Foreign transaction fees are additional costs added to purchases that you make abroad. A fee is often charged by the card issuer when you make a transaction in a foreign country and in a different currency. While many big banks have locations around the world, they still charge foreign transaction fees to withdraw money. For example, check out Wells Fargo banking fees and charges — while seemingly convenient, you still have to pay to take out money from your own bank! The fee can usually found on your card statement as a separate charge.
So if you spend $100 at a foreign restaurant, an additional $3 (in other words, 3%) may be charged from your account as a foreign transaction fee. Although you may think “that’s not that much”, don’t take it for granted. If you continuously use your credit card transactions while traveling, the fees will add up quicker than you expect!
Thankfully, not every credit card charges foreign transaction fees. Even so, you have to be aware that there may be other surcharges to look out for while you’re on foreign soil.
How Can You Avoid Foreign Transaction Fees?
It’s not that difficult to avoid the annoying fee when you make transactions abroad. Here are some tips to do this:
- Pay with Cash
Although you shouldn’t walk around with your pockets stuffed with hundreds, it’s always good to have cash on you at all times, especially in remote locations. There are still plenty of places that don’t take cards, so you’ll have to pay in cash regardless.
Before your plane takes off, calculate an amount you’ll need each day and withdraw it on your home turf before racking up the fees. After arriving in the country, you can pretty easily find somewhere to exchange the currency.
- Get a Credit Card without Transaction Fees
If paying foreign transaction fees gets on your nerves, try to find a credit card that doesn’t charge them when you make transactions overseas. However, take into consideration how this might affect your credit score. But if you really want to pay with a card without getting charged a fee, this is the way to go.
Foreign transaction fees can be really annoying, especially when you just want to enjoy a worry-free vacation. Nevertheless, avoiding them is not impossible if you take the necessary steps before setting sail. Happy travels!