So you have booked a trip to a far off land. Now, you can start to get excited!
You plan your itinerary, book accommodations, trains, planes and automobiles and hopefully start to pay for some (or all) of your expenses before you get there (see below for which cards are best for that!)
But how do you work out what to do with your currency once you have it? This is the question many travellers face. I see a lot of questions posted online about this very topic. The answers are often endless – people travel how they want to. But what advice should you listen to? Because let’s face it – many people make reckless choices and if you get caught in that worm hole – we can’t save you if you listen to it.
Instead of asking what to do with your currency, you should be asking these 4 questions and answering them with whatever answer makes you feel comfortable. It’s your vacation and if things go pear shaped you need to ensure you have thought about backup plans – and back up plans for back up plans! Seriously, I am not even joking!
1. What card currency options are there and which ones will give me the best return for my money?
2. How many currency options should I be using on my trip?
3. Should I take any foreign cash with me or rely on cards?
4. Where will I keep my currency when I travel? (At home and abroad)
Like I said, the answers to these will be different the more people you ask. But as someone who has traveled for over a decade, lived abroad twice and never lost access to my currency – though things have happened, or I have heard some horror stories – which remind me about why I am always prepared. I like to think my advice here is worth listening to.
1. What Card Currency Options Are There & Which Ones Will Give Me The Best Return For My Money?
This question is complicated. But thanks to people like me, I have crunched the numbers in more detail than anyone. I have looked at the rates of each card and calculated the losses and came up with a pretty solid conclusion on which cards to rely on in 2019…and which ones to avoid.
Hot tip – stop converting currency with a Big 4 bank in Australia. Seriously. Their rates mostly SUCK! Yes they are competitive about some currencies. But not many of them. There are far more competitive cards out there. But if you have your heart set on a Big 4, make sure you fight them for their best rates – which you should do when converting large sums of money. They will offer better rates, but you will have to ask and it may not always happen. Plus many of them have ATM fees so that doesn’t help them. The losses with some of these banks are so BAD, I can’t fathom why people use some of them at all.
See my breakdown on travel cards for Aussie travellers here – its pretty comprehensive.
On top of my card recommendations, you need to factor in some things when using any travel cards:
Which cards have the best rate? (obviously)
Which cards have fees and what do they amount to?
Which companies are the best for my needs?
Should I pre-load money or use a debit card?
If you can consider all of that you will make the best decisions for your vacations. Just because something works for someone else, doesn’t mean it will work for you. And if you want to lock in money or prefer to have the market rate, this will also factor in to what you decide on. But I wouldn’t put all my money on one travel card, ever. That is completely ridiculous and very reckless behaviour for any traveler.
2. How Many Currency Options Should I Be Using On My Trip?
This is the most important question in my book.
I see a lot of advice out there about this – and some of it is very scary. Many people rely solely on cash. They take thousands and don’t use cards. They tell people this is what they do, and rave about it. Advice like this is valid if it’s what you actually do – but you do need to be very careful about the influence you can have on the decisions other people make. Reckless advice I have zero time for. Please determine what advice is sound and what is not before you travel. Especially if this is your first overseas trip. But to me, only taking cash is extremely ridiculous a notion. What if you are robbed? What if you lose it all? Will you be able to cover emergency costs should something happen beyond the amounts you have?
Many places also require credit cards for temporary holds – or you have to leave a decent chunk of cash on you instead to offset this – but why go through all that when holds rarely go through as transactions, and if they do the money is refunded anyway? Just take a second credit card. Easy.
Once you find the best currency option that works for you – in terms of cards, then think about how much cash you will take. But while cards are the safest option, you must also factor in when things go wrong, or when cards don’t work, your money is not accessible, or the million other things which can happen while you are away. This is exactly why I carry more than one card.
Here is my advice for what you should do:
Take at least 3 currency options.
-A Fee Free Credit Card
-A Fee Free Debit Card or Pre Loaded Travel Card
-If You Want A 4th Backup – Take either an extra credit, debit card or pre loaded card with no money, but one you can put money on if needed. (You may not use this option though)
When I travel, these are the cards I use – so in my defence, I actually have FIVE backup currency options.
Latitude 28 Degrees Global Platinum Mastercard
ING Everyday Debit Card
Citibank Plus Everyday Debit Card
Transferwise Debit Card
Cash – I always purchase and get PRICE BEAT GUARANTEES and now, RATE MOVEMENT GUARANTEES with Travel Money Oz
Why do I use so many cards? There are many reasons for this. But all in all it is because I want BACKUPS. Actually, I’ll rephrase that, I don’t travel without backups.
28 Degrees Credit Card
I use my 28 degrees credit card because it is fee free – no international transaction fees, no worries and a $6000 AUD limit for me. You do need to pay it off in full every month to avoid fees, which are high if you end up getting them. Credit cards are a must have item because they will always work – especially if debit cards don’t. I don’t know how anyone travels without a credit card. When it comes to hotel or rental car holds, I use either this credit card or my other standard credit card – because the holds never go through and remain “pending” so you do not need to use fee free cards for these kind of transactions. But it’s safer to use a card you won’t be using as currency for holds in my opinion, to offset confusion on how much you’re spending, but it’s ok if you only have one credit card and want to use that for them. If you want to pre-book anything, this card is perfect for doing that too.
ING Everyday Debit Card
I use this card when traveling – as well as at home, because their saving account, the Savings Maximiser is outstanding for interest compared to any other Aussie bank. In order to get the bonus interest on your savings account, and to have your Everyday debit account card work as fee free anywhere in the world, you do need to transfer $1000 AUD into the everyday bank account from an external account, and make 5 transactions each month. Once you complete this, the following month is fee free – which is rebated back at the end of the month if you pay any fees.
If you are doing short trips this works well, but if you plan to be away for a long while and won’t have the $1000 AUD to transfer in each month, then it may not be an option that works as a travel card. I am heading overseas next year so I won’t be working, but I will have a build up of funds in an external account so I can transfer money into my ING account each month, and make the 5 transactions to get the rebates as I travel. ING is one of the most popular debit cards for Aussies. But, they are a debit card which means you get the live market rate, there is no pre-loading with them. Like the 28 degrees credit card, you can pre-pay a lot of things with this card if the dollar is at a good rate, or even use it for financing a working holiday in Canada or the UK if you can meet the conditions it requires.
Citibank Plus Everyday Debit Card
The Citibank debit card is slightly better than the ING card because there are zero conditions on using the card. However, they do not rebate fees at the end of the month – you just don’t pay them at all – unless you don’t use a Citibank ATM you may pay fees when withdrawing money. Overall, they are a great option and one I have used many times and loved. The Citibank card is a debit card, you can’t pre-load money with them – however their pre-loading card, the Citibank Global Wallet is a great pre-loading card with some of the best competitive rates across the board. I use a different pre-loading card as you’ll see below, but if I didn’t use this, I would be getting the Citibank Global Wallet for sure based on my number crunching on my best travel cards article I mentioned earlier. You can use either the Everyday card or Global Wallet for pre-paying anything online before you go too.
Transferwise Debit Card (Pre Load Cash Card)
I have been using Transferwise for almost 5 years now, when it was mainly a bank to bank transfer option for expats in particular. I started using it when I lived in Canada, and needed a way to transfer my AUD money into my CAD bank account. Though these days, I could have used my ING or Citi card – had it been available back then to get the market rate and spend my AUD in CAD without worrying.
If you want to lock in money, Transferwise is awesome. I love the card because as a blogger, I can earn money in different currencies so having this card is a godsend. Transferwise actually launched their debit card very recently in Australia, but the best thing about this card is that it gives you a LOCAL bank account in selected countries. Right now, I have local bank accounts in USD, NZD, GBP, EUR, and AUD. This means people can transfer money into any of these accounts if I share my bank details with them. Or I can transfer AUD into any of these accounts, as well as pre-loading into other currencies too. So if you want to lock in money, Transferwise allows you to do this but there are fees involved. Even so, the fee is very small that you get almost market rate with their cards, making them one of the best options in comparison to everything out there.
For instance, converting AUD to USD, Transferwise as of September 7, 2019 has a rate of 0.68500 making $100 AUD a total of $66.89 USD due to paying a $2.35 AUD fee. If you were to convert $1000 AUD the fee is only $6.56 AUD and you would get $680.51 USD overall.
If I was to convert $100 with Citibank Global it would be a rate of 0.6729 or $67.29 USD; $672.90 USD for $1000 AUD – a loss of $7.61 USD compared to Transferwise.
If I was to convert $100 AUD with Travel Money Oz it would be a rate of 0.6566 or $65.66 USD; $656.66 USD for $1000 AUD – a loss of $23.85 USD compared to Transferwise (though they do Price Beat Guarantee so they may beat it.)
Therefore, Transferwise is a really good option and I can’t rave about them any more. They have been a godsend to me as an expat and now as a traveler. Whether I purchase things when traveling, or before I go – this card is a great option for all of it. But the main message if you are pre-loading is not to pre-load all of your money onto one card – leave some AUD in your local bank account and use fee free debit cards too. Spread it out to ensure you have backups.
If you do go with Transferwise – use this link here to have your first transfer go through without paying any fees (up to 500 pounds worth, or the equivalent in your local currency).
I always take some local currency with me when traveling. I use Travel Money Oz because they Price Beat Guarantee – and have a higher rate for Cash than their Travel Card interestingly. Last week, I noticed they announced their Rate Move Guarantee, which offers anyone who goes in store (and asks for the FREE Rate Move Guarantee to be added to their purchase), a buffer of 14 days should the rate improve. If it goes higher than the rate you received – you can make a claim and they will put that money back into your personal bank account. This guarantee is only valid for particular currencies – but the main ones are all there.
I never take more than $1000 in local currency though, because the thought of losing more than this amount at the hands of a thief or me being careless or losing money is sickening. But if traveling to the US in particular, I always ensure I go over immediately with some $5 and $1 bills so I have some money for tips for the shuttle I take upon arrival at LAX – you can only really Uber if you have an active sim, but I tend to purchase a sim once I arrive as the deals are better than online in my experience. But you can purchase a sim card before you go through reputable companies like Sim Corner.
Depending on the country, taking cash may be something you need to do more of (do your research!) – due to the lack of debit and credit facilities, but you still should only carry small amounts at a time, and withdraw as needed – or before you arrive in a smaller city. It just makes sense.
So as you can see, my choices in covering all my bases are spot on. I have a credit card (plus a standard Aussie one as a backup to that – but only for HOLDS that don’t go through!), I have debit cards and pre loaded cards, plus cash. If I lose a card, I won’t have an issue with not having money. If a card is blocked by the bank for fraud – which can happen, I have backup cards until I can unblock it. If a card just decides not to work or money is skimmed – any of these can happen, then I still have access to money. You really need to ensure you always have access to a card when traveling anywhere so you aren’t left overseas with zero funds, cards and ways to pay for anything. I can electronically transfer money from my AUD bank account and have funds within a set period of time, or just use my credit card to tide me over. It is really that simple.
3. Should I Take Any Foreign Cash With Me Or Rely On Cards?
Given everything I just said in the area above, taking only cash as currency is a really bad idea.
You should always take some currency – but if you need more you can use an ATM and get more. Some countries you will need to carry cash on you – very small cities and towns may have limited card facilities. Or like when paying for petrol – you need to have a US zipcode in the States to use a card, so I ultimately have to leave cash with the operator, fill up and then receive my change as I have no idea how many gallons I need to fill my car when I am used to litres! Cash is a necessity for things like that!
But as I stated, I would not take any more than $1000 in the local currency and would spread it out among different places in my bags to ensure if something happened that I didn’t lose all of it. I have said before, that many people online will tell you to take just cash – this is a very reckless piece of advice. There is no need to carry such large quantities – especially if you have pre-paid a lot of things before you leave. And do bear in mind, carrying more than $10,000 cash in any currency can lead to issues for you anyway because it must be declared to customs and border patrol.
Also remember that when you use a pre-loaded card – NEVER use these for hotel or car rental HOLDS, or paying for meals in a sit down restaurant you will be tipping in. You will end up LOSING access to the money that is on that card for a temporary amount of time. I had $1500 USD out of reach for 1 week when I went to Vegas in 2011 – the hold held our money in what caused a very stressful situation for us, but thankfully was released in time to pay for our NYC hotel. Holds are “pending” transactions and even if you use the card to then pay for this hotel stay, or that meal with a tip, you will cause a second transaction to occur before the pending money is released back. Therefore, when paying for a hotel, car hire or restaurant that involves tipping, please use a DEBIT card, CREDIT card or CASH when doing these purchases. Far less of a headache – and no need to sit and wait for money to return to your card. You cannot touch PENDING money until it returns to your card. Lesson LEARNED.
4. Where Will I Keep My Currency When I Travel?
When it comes to carrying currency the age old question is where to keep it? At home, I keep it in a safe. Abroad, you have a number of options, but I like to divvy up cards and cash between wallets and place them in different parts of my bag, or in 2 different bags that I carry with me. NEVER place any of these currency items inside your checked bag though – many people have done this and been robbed at airports so it does happen. Bags are x-rayed.
Spread your cash out in different places – even inside empty drink bottles, shoes and what not. Use the hotel safe – always remember you have stuff in there before you check out! But, make sure you keep your main cards with you in your main wallet. And if something was to occur to any of your cards, always ensure you have the card numbers and login information – plus your bank’s phone number so you can cancel the cards before anyone can use them. This also applies to any institution which gives you 2 cards per account too. Never carry them both in the same wallet.
When it comes to passports, I always carry mine with me as I often need it as an ID source. But if you carry your passport with you – make sure you know where it is at all times, and ensure you have a photo of the ID page on your phone, laptop or device if taking one, as well as paper photocopies. You can never be too safe. Additionally, taking 2 passport photos with you in case you need a replacement passport will also come in handy to expedite the process should this happen.
The main thing to remember above all is that shit happens. Money gets lost or stolen, or cards don’t work on any given day. You need to ensure you are traveling with backups and that if your wallet is stolen or lost, that not every currency option is located in that very wallet. I don’t carry money belts, I use a cross the body tote bag which has different compartments and have never been robbed or lost money. Or lost a passport for that matter.
Worst case, use the hotel safe in your room, or at the front desk if you are very worried.
Be smart. Be prepared. Do your research and you will usually be ok. Make sure you understand what process you need to have in place should something happen to a card that you are using – a few institutions will transfer the balance of your card via Western Union as a very last resort. But for me, as long as I can access my AUD bank account and transfer money onto at least ONE card from my home bank account, I can handle anything. If something happens, then I can travel stress free and without worry. I will never travel anywhere with only ONE card. That is the worst idea you can have. Cancel the cards if something happens and deal with it properly when you get home. Don’t let it ruin your trip.
It is just very important that you have access to money while you are away on vacation – or a friend can transfer you money from their bank account to a card you’re traveling with should you need it.
Be a smart traveller.
I hope all of this information was a benefit to you. If you are planning to travel to the USA or Canada please join my travel group USA & Canada Travel Planning for more insider tips, seasoned knowledge from travellers and locals, and so much more.