Using money overseas while traveling

English: Visa Electron debit card Svenska: Vis...

English: Visa Electron debit card Svenska: Visa Electron betalkort (Photo credit: Wikipedia)

(See the bottom of this post for any updates!)

A friend of mine living in France recently gave us tips on how to use money while traveling abroad. Some of it was stuff we’d already prepared for, but there was a lot of new info we hadn’t known (all of this is hearsay, as we have yet to experience any of this, but we trust their judgement!). We’ll definitely update this blog with more info once we experience it firsthand.

Credit Cards

Much of Europe uses a chip & pin card, so you should sign up for one before you go (the American Airlines Citibank Card is one we signed up for that offers chip & pin to its customers). However, after a phone call with one of our Visa card companies, any store in Europe that accepts Visa credit cards will also accept a magnetic stripe card. France & Spain widely accept credit cards. However, many places in Germany, including Berlin and Frankfurt, do not. Also, many places that accept credit cards will offer you the option of being charged in US dollars, or in their local currency (euros, pounds, etc.). Always insist to be charged in local currency, because they might charge you hidden conversion fees when switching to US currency.

Money / Cash

Never change money at the airport, you will always get the worst rates. It may be best to withdraw money at the ATM outside of town, or exchange your cash in town. It’s not recommended to carry a lot of cash around with you anyways. But it is handy when you come across small towns or villages that don’t have credit card acceptance.

ATM / Debit Cards

This is something we just learned over the weekend. Apparently when withdrawing money overseas, your financial institution will charge you international withdrawal fees, oftentimes it will be an outrageous amount. For example, we learned that our banks (Chase and Wells Fargo) will charge $5 per withdrawal, and in the case of Chase, an additional 3% of whatever amount you withdraw. That’s pretty stupid! This is also on top of whatever the foreign bank will charge you. I’ve also heard that Bank of America doesn’t charge you a fee if you withdraw from one of their partner banks, but the other bank may charge you something.

This makes it sound like using ATM cards is the worst idea, and you should carry tons of cash before you go travel. Nope! After doing some quick research, I discovered that the best ATM card to use while traveling is the Charles Schwab card. You will need to open a checking account with them, but it has no fees, and no minimum (it is tied to a brokerage account with also has no fees and no minimum). The cool thing is that they don’t charge a fee when withdrawing from overseas ATMs, and if the overseas bank charges you, you DO pay a fee upfront, but Charles Schwab fully refunds you at the end of the month. Apply for it as soon as you can, it can take up to 2 weeks for your debit card to arrive, we had to rush to the local Schwab office yesterday to get our application expedited (4 business days, $15), since we leave for Iceland in a week.

Those are all the tips we’ve found, we’ll definitely share more of our experiences with using money as we go along our trip, and write up another article about applying for credit cards with frequent flier miles.

Update 9/25 – Success! We managed to obtain our Schwab ATM card the day before our departure. However, it tool 3 business days for money to transfer between banks, so plan accordingly! We were able to withdraw money from an ATM in Iceland without any issues.


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