7 Tips for Using Credit and Debit Cards While Traveling Abroad (Real World Tips)

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Planning a European holiday or a South American adventure? You’ve surely been planning your trip out, thinking about where you want to go and what you want to see. But have you thought about how you will pay for purchases while abroad? The article below goes over some tips for using credit cards abroad, and also covers info on using debit cards abroad for ATM withdrawals.

using credit cards abroad

The first thing to remember is that many merchants only accept cash. This varies hugely by country and region, but just keep in mind that you may need to use cash quite a bit more than you’re used to in the United States.

Second, you’ll want to call your bank before leaving and tell them of your travel plans. This is true whether you plan to use a debit card or credit card, or both.

Now we’ll get into some specific tips for using credit cards while traveling.

 

Using Credit Cards Abroad

  • Stick with a Visa or Mastercard – Here in the US, most places will accept American Express and Discover. Abroad… not so much. Stick to the most widely accepted cards for best results (which are Visa, followed closely by Mastercard)
  • Watch out for foreign transaction fees – Some credit cards have a foreign transaction fee, which is charged every time you make a purchase in a foreign currency. The fee is usually around 3%. These charges can add up real quick, so you should check with your bank to see if there is a foreign transaction fee on your account. If there is a fee, you might want to get a good credit card for travelers before you leave town.
  • Understand your card’s benefits – Many credit cards offer useful benefits, perks and travel services that may come in handy. For instance, some cover rental car damage waivers, and some provide 24/7 free concierge services. You can research card benefits on your bank’s website, or call them. Underwhelmed by what you find? You may want to get a better credit card before heading out!
  • Pay in the local currency – Sometimes at a payment terminal (or ATM) you will be asked if you want to pay in the local currency, or in your home currency (USD). Always select the local currency, as the exchange rates offered on these transactions are quite poor. When you make a purchase in a foreign currency, your bank will convert the charge to USD for you (at a better rate).

 

Using Debit Cards Abroad

  • Do not use debit cards for purchases – In general, it’s a good idea to avoid using debit cards for purchases, and only use them for ATM withdrawals. This is because debit cards do not have the same level of fraud protection as credit cards. If your debit card gets stolen or skimmed, it could be more harmful than a lost credit card. So, it’s best to use credit cards or cash for all purchases abroad.
  • Consider bringing two debit cards – If you have multiple bank accounts, it’s worthwhile to bring 2 separate debit cards. That way if one is lost, stolen or stops working for whatever reason, you’ll still have access to ATM withdrawals.
  • Decline currency conversion at ATMs – In many areas, when you make an ATM withdrawal, you will be asked if you want to convert the charge into your home currency (USD). This makes sense at first glance, but here’s the problem: they usually give you a really poor exchange rate. Your bank’s own exchange rate will almost always beat the rates offered on currency-converted ATM withdrawals. For example, if you’re traveling to Europe and want to withdraw €100 Euros, the official exchange rate might be $110 USD. If you have a bank that offers free currency conversion, you’ll pay $110 exactly (or maybe slightly more). However, that same charge “conveniently” converted to USD by the ATM will likely charge you more like $115 or $120. Avoid these offers!

Follow these credit card tips for international travel, and you’re sure to have a fantastic trip!

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