If you’re traveling abroad for the first time, whether as part of a study abroad program or simply on vacation, you might be concerned about how to handle your money. You will need to keep money safe from thieves, but at the same time you don’t want to be that person who has to strip down to their underwear just to access their cash. You also need to master the art of managing money at a time when spending seems like the only fashionable thing to do.
The good news is that, thanks to the internet and technology, it is easier than ever carry and manage money abroad. We now have safer and more convenient payment methods as compared to the pre-internet era. However, debit cards, ATMs, and credit cards aren’t foolproof either. If your card gets in the wrong hands, you could easily lose your money.
Another challenge that comes with handling money when traveling is the process of changing your home currency to your host nation’s currency. Tourists often find themselves counting losses after being forced to exchange their money from fraudulent currency exchange agents, most of whom distort the exchange rates to their advantage.
With that in mind, here are 5 tips for managing your money safely and elegantly while traveling abroad.
1. Save your money in a bank with low international fees.
ATMs are everywhere these days which makes credit cards and debit cards convenient to carry and use, but their international charges can easily put you off. If you will be flying to an international destination, make sure that your money is saved in a bank that doesn’t hike ATM charges when their card is used abroad.
Most banks charge unreasonably high fees, so you need to confirm whether your bank is among them. If it is, opening a different bank account would be a very wise financial decision.
Also, see what your bank (and others) offers in terms of credit cards. A lot of banks have cards specifically designed for travelers that offer lower fees and extra perks like travel points. Applying for one of these cards could be a great solution for you. Just make sure you do your research, especially in regards to interest rates and annual fees.
2. Know how and where to exchange currencies.
To have the best experience abroad, we recommend always having some cash in the local currency on hand. One of the best and easiest ways to do this, is to exchange your money from your local bank or travel agency before leaving home. This is a good way to ensure you’re getting a fair rate.
When exchanging money abroad, always pay attention to the exchange rate and attached commissions as those can be really huge sometimes. International banks, in particular, have a tendency of overcharging clients. If you feel like you are not getting enough pesos for your dollars, for example, don’t shy away from shopping around for better exchange rates.
Lastly, don’t be fooled by the black market currency exchange agencies that promise you heavenly exchange rates. Black markets are illegal and can land you in serious trouble, not to mention they are notorious for overcharging unsuspecting tourists.
3. Keep your cash in multiple safe spots.
Your travel money and credit cards are safer when kept in multiple, separate spots than all in one place. Imagine what would happen if a thief snatched your bag, the bag that unfortunately contained all your cash and credit cards? That would be chaos.
But if you have, say, five different money locations including your backpack or purse, your wallet, and a secure coat pocket, even if you do get pick-pocketed, you can rest easy knowing you still have access to money.
4. Have several backup cards.
It is risky to depend on only one debit or credit card when away from home. If your card gets locked or stolen you’ll have serious problems trying to access your cash.
Always ensure that you have multiple cards with you so that if one malfunctions or gets lost, you can use the other one, even if that other one is from a bank with higher international fees. After all, wouldn’t you rather pay the extra fees than be stranded in an emergency thousands of miles from home?
5. Keep money in small denominations.
It can be tempting to withdraw huge chunks of money, especially if you’re paying a high transaction fee, but you should try to resist the urge as doing so can lead to unnecessary impulse buying.
Large bills also tend to attract thieves more than small denominations. Keep your money in the equivalent of $5’s, $10’s, and $20’s rather than $50’s and $100’s.
Small bills will also make is easier for you to pay for everyday purchases like coffee or when you want to tip your free walking tour guide.
About Lisa Mottins: Lisa is a young, ambitious writer with a bachelor’s degree in psychology from UCF. She is currently learning to code and developing her photography skills. She loves expressing herself creatively and sharing her experiences in hopes of helping others.