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Which credit card deal is the best for traveling?

2007-07-06

If you have ever traveled out of the United States and into one of the many foreign ‘tourist’ hotspots then you have probably realized at least one thing- you need the right currency to purchase items! Sure cash dollars are an important type of payment but overseas it can be much different.

The three main types of currency that most people carry with them when they travel are traveler’s checks, credit cards and debit cards. Each has their own advantages and disadvantages so you have to look at where you are going, for how long and what type of exchange rates you will get.

There is not just one perfect travel currency, even though it would be great if there was! The below article may help you sift through your options better!

Traveling the ‘old fashioned way’- traveler’s checks! This has long been the staple way to travel. You go to your local bank and have them give you a particular amount of currency in traveler’s checks. These checks are one of the safest, and therefore most popular, ways to travel.

Normally a bank will charge you somewhere around 2 or 3 percent for the checks, unless it is your normal bank and you will get them for free. Here are a few helpful hints if you decide to travel with these checks:

• Get them in $20 denominations because they will be easier to use. If you only have $100 traveler’s checks you will have a more difficult time using them at simple vendors.
• Get your checks from a popular source, most notably American Express because they are known worldwide and have security and protection on them that is unmatched.

The great thing about these checks is that they are just as portable as cash, but a lot harder to lose! If you lose cash, you lose it for good- it’s not coming back! If you lose these checks it’s not a huge deal because they will be replaced, usually within 24 hours.

The disadvantages to using traveler’s checks on the road are that they aren’t accepted in many of the more rural areas. If you are going to Paris, France you probably won’t have a tough time finding places to use them but if you venture outside of Paris to one of the smaller towns you will have a more difficult time spending your money. Keep this in mind as you probably want to have a little bit of cash on you!

Traveling light — the credit card!

Credit cards have been sneaking up on traveler’s checks as the best form of travel currency and they just as well may be ahead of the checks. Why? Credit cards are accepted millions of places worldwide whether it is a VISA or MasterCard and HSBC and Citibank have global headquarters.

Credit card applications are easy to fill out and if you have good credit they will give you a reasonable credit limit to work with. Plus, the fact that you can use your credit card at nearly any ATM for a cash advance makes it even more attractive!

In fact, it is this multi-use nature that makes credit cards so useful. You have the ability to use them for purchases, for cash advances and they can be found nearly anywhere abroad!

And now, credit cards have a safety net in case they are lost and stolen. If you suffer identity theft either at home or overseas you will only be liable to pay $50 and then you will have your card replaced! This safety feature protects people from facing stiff penalties if their cards have been misused.

Many people use their top credit card deals as a way to budget their spending overseas. Credit card statements can be checked periodically on the internet and if you want you can see what you are spending and where — at any time! These great credit card deals will take away your worry about coming home to a surprise bill!

If you don’t feel comfortable using your credit card overseas you have the option of getting a pre-paid card as well. You can go to your local bank and fill out a bank credit card application.

The card will look like a regular credit card with a DISCOVER or American Express logo but it will actually be a secured credit card. A secured credit card works more like a debit card where you can only spend as much as is on the card itself.

As with any good thing, there is bad that accompanies it. When it comes to using your credit card overseas you should consider a few of the negatives as well. Here is a brief list:

• They aren’t accepted everywhere. While the MasterCard commercial may say they are accepted everywhere, they aren’t in the rural parts of many countries abroad- and in the United States!
• You may get charged by your credit card company for using the card in another country. You’ll have to check with your card company before you leave to make sure of this, but many times they will charge you a certain percentage each time you swipe your card!
• You may overspend! Impulse shopping is easy with the plastic because it doesn’t even seem as if you are spending. If you are disciplined you won’t have a problem with this though.

The credit card’s imitator- the debit card!

Debit cards look identical to credit cards and they can be used for a variety of purposes that are similar. Many people are now saying that debit cards, not credit cards or traveler’s checks, are the new way to travel. Why?

You can get wholesale exchange rates from any ATM worldwide when you use your debit card and you can get local currency as well! ATM cards, as they are otherwise known, can be used almost anywhere credit cards are.

However, while credit cards come with certain protections for their consumers, debit cards don’t. It is more like using cash; if you debit card is stolen and misused then you will risk losing everything in your checking account! If you are careful and watch your spending and your card you should be all right though.

Consider your options. Where are you traveling too? If it is multiple locations, can you use a specific currency at each? What types of currency are available to you? Once you can answer these questions you will be better equipped to travel.

Whether you end up looking for credit card deals, bank credit card applications or going to American Express for traveler’s checks you need to figure out where you are going and for how long. The best situation would be to take some of each currency, including cash, just in case.

Paying bills overseas! Since the advent of the internet, it is now possible to pay credit card bills overseas. Many people that may be going on extended trips don’t have to worry about when their bill is due, how much it will be or anything else because they can check their status at any time online. Make sure your US credit card deal offers you online service because the good credit card deals do this for you.

Plus, another helpful thing to do is to contact your credit card company before you leave for your trip because letting them know you are traveling abroad will clear up any confusion. They may see overseas charges and get concerned and think someone stole your information! Talk to them ahead of time!

Traveling overseas can be a fun thing and a great experience but you will want to make sure you are doing it right and taking the correct currency! Remember, having back ups is always a good idea!