Using Credit Card Abroad? How To Choose Credit Card For Travel
How to choose credit cards to use abroad for travel and holiday - what to look for in a travel credit card
Ah! The warmth of the hot sun, the cool splash of the sea, relaxation...it’s what we all look forward to especially after the hard grind of daily life is over for a couple of weeks. But don’t get caught out with your credit card this summer! Don’t let it ruin a well earned holiday! Here are some guidelines of what to look for when choosing the best credit card to use abroad.
Overseas Transaction Fees
FeesMany credit cards charge a 1% - 3% fee every time a purchase is made or the card is used abroad. This may not sound very substantial but it can very quickly add up and come as a surprise once
the holiday is over. This information is often in the small print of credit cards so find out firstly, if your card has these charges by checking the terms and conditions and secondly, if it does, maybe it’s worth considering getting a new one. There are several credit cards that do not charge overseas transaction fees which can effectively save you extra unnecessary payments. Even if you are not a frequent flyer and do not go abroad often, try and work out how much will be spent on a holiday taking into account accommodation, meals, entertainment etc. and weigh up whether it will be worth getting a new card, which in many cases it probably is. There is concern that these extra charges can push ordinary people into unnecessary debt so think carefully and shop around before you use choose a credit card to take abroad.
Exchange Rates for overseas credit card transactions
Another thing to consider is what foreign exchange rate is received when making purchases abroad with a credit card and whether this is a fair exchange rate or not. Many credit cards do charge a better exchange rate than local currency exchange booths or banks, however, numerous countries give the option to pay for purchases in local currency or your home currency such as dollars or pound sterling. If this is the case, you may instinctively think that the home currency is more advantageous to use because it is associated with your credit card but actually, it is better to pay in local currency. This is because the local restaurant, retailer or other establishment could easily charge a higher conversion rate than the standard bank which could add up to 4% on to your bill. If you are not given a choice of which currency to pay in and it is insisted you pay in your home currency on your credit card, it is worth you not using your credit card and paying in local currency cash instead to avoid getting caught out.
Rewards on credit card spendings
We all love extra unexpected perks, be it a free coupon or money off a certain product, so why not get one when using your credit card to go abroad? Various credit cards offer rewards on purchases such as hotels and flight tickets which will effectively save you money in the long term when you redeem your rewards. Additionally, some credit cards will include trip insurance which will provide cover if your baggage is lost, stolen, damaged or delayed. They may also cover you if your trip is cancelled for some reason but be aware that this is usually on prepaid tickets. So, why not compare different credit card companies and see what benefits you can start enjoying because we all deserve a few extra bonuses sometime.
Spending some time choosing the right credit card for your next holiday can always be rewarding in many ways. Taking into account overseas credit card transaction fees, exchange rates and reward points as discussed above can surely make your travel abroad with your tailored holiday credit card a great experience.
