The easy availability of money by using credit cards offers a lot of convenience to credit card users. It requires some alertness and caution to avoid the trap of high charges on credit cards, mainly when you use them in some other countries. Besides the average interest rate charged on the credit cards for every transaction, depending on whether you pay the bills within the free credit period when you use the same credit card for transactions in foreign currency or countries, it can attract foreign transaction fees, which are often very steep.
Credit cards can significantly simplify overseas travel, although you must carry some cash with you. Credit cards help avoid the hassle of converting currencies in other countries, which can be quite challenging and time-consuming to determine the right amount of money. Moreover, credit cards offer the lowest conversion rates while converting the currency automatically. Using credit cards overseas protects you from the risk of pickpockets that are a relatively common experience for tourists and travelers.
To make your overseas trip cheaper by using credit cards, you must follow these tips, including some actions to take before departure and some actions to take overseas.
Get a credit card that enables foreign transactions
Even if your credit card enables foreign transactions, which happens with most credit cards, be ready to pay some extra fees towards a foreign transaction. The fees can be relatively high over cumulative purchases as each transaction would cost 2%-3% extra. Therefore, before you decide to use your credit card and debit card overseas, carefully check the terms and conditions in the agreement before leaving your country. Try to get a credit card that does not attract transaction fees overseas or a debit card that does not charge anything extra for withdrawing cash in foreign ATMs.
Contact the credit card issuer before traveling
Keep your credit card issuer informed about travel planning to foreign countries and collect the helpline number you can call from overseas for any support. It will not only save you the embarrassment of suspension of your credit card due to suspicious activities. It will also allow you to seek help from the card issuer whenever you face any problem.
Avoid dynamic currency conversion
While shopping, it can be a daunting task to relate foreign currencies to the American dollar when you are shopping because the mental calculations can often go over your head. Foreign merchants can try to fool customers by feigning more convenience by offering an invoice in US dollars while using some highly uncompetitive exchange rates. The convenience is lost amid the extra money that you pay. Follow the rule of transacting in local currency only to avoid losing money during overseas transactions and sign on bills or checks that use local currency.
Have your passport with you always
Travelers from countries that do not use the latest chip and pin technology for credit cards could be at a disadvantage in other countries that use the latest technology and refuse to accept the old-fashioned credit card.
Having your passport with you can help save the situation by enabling proper identification.