” url=”http://www.flickr.com/photos/uggboy/4273262980/in/photostream/”]In preparation for what I’ve lovingly dubbed my “Eat, Pray, Freak the Eff Out That I’m Turning 30” jaunt to Europe next month, I’ve started gathering information on what money matters to expect while abroad. To answer my burning questions, I tapped Ed Perkins, contributing editor at SmarterTravel.com. Read on as we break down what every globe-trekker should do before and after stamping her passport:
First things first, tell your bank you’re skipping town. The last thing you want is your bank freezing your credit (to protect against ID theft) when you’re just about to crash at your hotel. “Call your bank immediately and load their international number onto your phone,” says Perkins. “All the banks that issue credit and debit cards have a toll-free number you can call overseas to report the loss immediately.”
Find out what the bank does in case of emergency. Once I called my debit card issuer, I found out it’d take 3-4 days to receive a new card (!!!). Now, I’m definitely bringing a backup.
Avoid changing currency at US airports. “The exchange rates are usually pretty bad,” warns Perkins.
Once you land, get cash at an airport ATM. In case I lose my wallet or the bank accidentally freezes my cards, I’ll need enough cash to get by for a day or so, says Perkins. Make the most of an ATM’s foreign transaction fee by taking out a reasonable amount, like 200 euros, he suggests. Check your card issuer’s website to locate a terminal where you’re going.
Prepare for smart card debacles. Almost all European credit cards use smart card technology, says Perkins, but since US cards have been slow to catch up, you may find yourself arguing with a merchant over whether he’ll accept your card. Don’t stress: If the merchant takes Visa or MasterCard, he’s obligated to swipe your old school card with the magnetic stripe. The real thing to watch out for are ticket machines at train stations. You may be forced to wait in line for a booth operator to process payment.
Pay with credit at hotels and restaurants. “It’s better to use a credit card,” says Perkins, adding that you’ll lose no more than 3 per cent, which your issuer will charge on the deal. If you’re with Capital One, you’re lucky—the issuer doesn’t charge foreign transaction fees.
Insist on being billed in foreign currency. “Never let the merchant bill you in dollars,” warns Perkins. “What happens is they’ll decide on whatever exchange rate they want, and they’ll often use a bad one.” Even worse, your bank will still treat it as a foreign transaction since it originated outside the U.S., even if it’s in U.S. dollars.
Practice safe ATM and debit card swipeage. You wouldn’t dare stick your debit card into a standalone or card-skimming ATM in the states, so keep the same mindset when travelling abroad. Avoid shady machines on the street, and always take out cash from a bank-affiliated ATM to be safe. As for those public Wi-Fi locations and Internet cafes? Forget about it.
Skip the traveller’s checks. Contrary to my father’s advice, this is not a must-have when venturing abroad (and hasn’t been for 20 years or so). “If you already have them, use them up, but the exchange rate isn’t as good, to say nothing of the fact that a lot of foreign banks and merchants are no longer interested in dealing with them,” notes Perkins. They also have lousy exchange rates. With traveller’s checks you’ll usually pay between 3 and 6 per cent, much more than the 3 per cent you typically lose with plastic.
Don’t convert excess currency into cash. “At the end of the trip, you don’t want excess currency,” warns Perkins, before adding that you’ll pay a bigger fee to convert the money back into dollars. Budget how to spend them, or better yet, save them for your next adventure.