THIS Is What You Need To Know About Spending Money When Vacationing Abroad
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Spending When You Are Abroad

Updated on December 07, 2020 11:37 am
Spending abroad

Planning for a trip overseas is exciting! Perhaps you have been saving money for some time now for your long-awaited foreign holiday. And finally, you decide to embark on an adventure. You have your bags packed, flights and hotels are booked, have prepared your travel itinerary and you are ready to go.

But before you go for the trip, you need to plan ahead on how you will be spending money once you reach your destination country.

Should you carry bundles of hard cash or travel light and take only plastic cards with you? What if you end up paying more than you expected? What if you end up spending your money on unnecessary fees and potentially ruin your trip abroad?

To start off, when you travel abroad, having a designated storage place for your money can make a huge difference. While purses or wallets are common for carrying your money or cards, they can easily be lost or pick-pocketed. That's why fanny packs or garments with money pouches are go-to travel accessories. You can keep your precious belongings close to you and not worry about getting it stolen.

Most of the preparation for overseas travel should focus on safety, health, and financials. There is no doubt money is an important part of the travel experience. This should also include your travel medical insurance. Unforeseen incidents can happen that can deter your travel plans and you need to be prepared for it. Pocket expenditure on medical emergencies abroad is very costly. It is best to invest in travel insurance to give you peace of mind when you make your trip overseas.

Here, we have compiled a list that will be your guide to spending when you are abroad.

Carry Debit or Credit Cards With No Foreign Transaction Fee

Plastic money such as debit/credit cards is an efficient and convenient mode of payment in the age of cashless transactions. Most countries in the world today accept these cards (mostly Visa or Mastercard) and people wish to avoid carrying a wallet full of cash when they are out and about in another country. That is why plastic cards are popular for paying day-to-day trips, hotel bills, and other holiday expenses.

Having credit cards with you also helps when you are short of funds during your stay abroad. In case it is lost or stolen, you don't have to worry about losing your money.


The downside of using these cards is that there can be extra fees when you use it in a foreign country. Typically, the standard foreign transaction fee is around 3% for most of the card issuers. You need to pay a range of fees for foreign currency exchange, cash withdrawals, or POS transactions. All these fees do add up and increase your expenses.

Fortunately, you can opt for debit and credit cards with no foreign transaction fees that are meant for overseas use. These will cut your cost tremendously. Some credit cards also offer additional travel discounts, special packages, and privileges. Though with credit cards you do need to pay the interest charges and monthly/ annual fees. Compare and choose the one that suits your needs.

Do keep in mind to inform your bank or card company beforehand to prevent them from blocking your card in suspicion of unauthorized transactions from a foreign country.

Have More Than One Card When You Are Abroad

Bringing just one credit or debit card is too a big risk when you are traveling abroad. In case, one card gets lost or stolen, you have your other card to save the day. As the saying goes, do not put all your eggs in one basket. Having more than one card is a smart decision. You can leave one card at your hotel room while you have your other card with you when you are out in the crowd.

Carry Some Cash in Hand

Cash in hand


Taking a huge amount of cash with you is a bit risky. But having cash in hand, especially in the local currency can be extra convenient when making small purchases at the market or in case of an emergency where you can only pay in cash.

Look out for the best exchange rate offer if you are converting to the local currency (the currency exchange providers at the airport arrival area tend to offer the worst exchange rates and charge fees exorbitantly).

Once you have the cash, the fluctuations in the exchange rate need not bother you which is not the case when using credit or debit cards.

Use Prepaid Travel Cards

Prepaid travel cards are worth a try. You can either purchase them online or buy them from your bank. They are different from credit cards since you need to load funds with a fixed amount of money to use it before you travel. Should you run out of money, you can reload it, if your card is reloadable. You can simply do a money transfer online to your card from your bank account.

Avoid using credit cards to reload your prepaid cards since it is considered a cash withdrawal and charge you interest for it.

Avoid Multiple Trips to the ATMs

ATMs Abroad


Making multiple trips to the ATMs can incur withdrawal fees every time you use it. To cut ATM costs, skip transactions at low-limit ATMs and take out the maximum amount of cash that you might need in just one transaction.

Pay in the Local Currency

Whenever you have the option, always pay in the local currency. When you purchase with a card, paying in your home currency may seem appropriate but it is not so. Especially if you are paying in US dollars, the price can be more in dollars than the local currency. This is how merchants take more money out of you. So pay it in local currency to save money.

Credit Cards Have Better Currency Conversion Rate

You need to be aware of the dynamic currency conversion. The merchants may offer certain exchange rates which are of poor value. You may end up spending more than the actual price. Pay with a credit card in the local currency whenever possible. Credit cards usually have a better conversion rate than the local merchants.

Multi-Currency Prepaid Cards

A number of cards are now available in the market that allows you to hold multiple currencies on just one card. If you use US dollars to make a purchase overseas, your money will get converted (at the interbank exchange rate) to the local currency of your destination country when you use it. These cards enable you to spend it like the locals.

You can send money online using internet banking to preload the cards to do the transactions. If you want to reload, you can do so when the exchange rate is competitive. As long as the cards have the Visa or Mastercard logo, it will get accepted easily. These cards are alternative options as they are much cheaper than the standard debit or credit card or in case you do not have a good credit score to apply for a credit card.

The bottom line is travel enriches our souls. It opens your eyes to new ways of seeing things and gives useful perspectives. Having little money or time to not travel is not a good excuse. If you plan well enough, traveling to a foreign country should not be that hard. The world is getting smaller in today's interconnected world but experiencing the places first hand is on another level. And that's why you should travel.


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