Twenty-five years ago, when I first travelled overseas, there were really only two ways to take money overseas: traveller cheques and cash.
Travellers cheques were a pain in the arse. You had to get them. Keep them safe. Find a place to exchange them. All the time checking the exchange rate and commission or fees.
Cash was worse. If you're travelling for a length of time, and I initially went for 8 months, you need a lot of money. But it's just not safe to hold onto that amount of cash. When I travelled to Europe all those years ago, every country had different currencies. So you were always looking for places to exchange cash and travellers cheques and comparing rates.
So now in the era of credit cards and electronic purchases, how am I paying for things? There's actually two parts – paying for things from Australia and paying for things actually in the country.
I use AirBnB, like millions of others. What I love about AirBnB is you are given the price in your currency and the funds are taken out of your designated CC account at the time of booking. So no worries about fluctuating rates. No hidden bank fees. And all is paid before you travel.
But what about those things I have to pay for in Europe? I am a CC Queen and use them for most purchases but nearly always pay them off in full each month before they accrue any interest.
I have two cards. One is really a debit card. It works as a Visa card but I have to have money in my savings account from where the card draws. The other is an American Express card. I use them both for ease and the Amex for rewards. I use payWave and eftpos, rarely carrying cash.
Now I don't think that is going to be the way to go. Firstly AmEx charges heaps of steep fees for use overseas – at ATMs and point of sale. I know because I was hit in London, New Zealand and Japan.
Our Visa cards (Mr S has the same card with the same mutual bank) were not as bad but at shops only worked on credit, not eftpos which caught us out a couple of times. There's that moment at the register when your card is declined that you worry. Then you remember you can only use one way. Which way is it? You fluster and get more uncertain. As fees go, the Visa wasn't too bad at vendors but we were slugged at ATMs. Of course you need to get access to cash too.
So what's the best approach?
I like to have foreign cash before I leave Australia. Means I don't have to worry about it on arrival. I get some from Travelex before I leave. The exchange has always been good. And I pay by direct deposit so pay fewer fees.
For getting cash while in the country, I usually just use ATMs. I'm not sure if they (the insitutition that operates the cards) give the best exchange rate. You are definitely charged fees by the ATM operator and often your own bank too. But I like the convenience of ATMs.
I have been told, and limited research suggests, that the Citibank card is great for travelling. It has no or limited charges. And quite good exchange rates, making it good for paying directly to vendors, either in person or before we travel.
So I have applied for one of these accounts and cards.
It will be the main card that I will use to get cash from ATMs and pay vendors.
I will let you know after the trip what the fees are.
I'm not very good with exchange rates. I don't stress about them and I can't be bothered doing exact calculations. You really get little choice or variations anyway and you need to buy things. But as we will also use the Visa and AmEx, I will be able to let you know the difference exchange rates applied after our trip.
What do you use when travelling overseas? What have you found works best?