Money sense when traveling abroad
If stolen, foreign currency can't be replaced. Credit: Bloomberg News File, 2002
Whether checks, card or cash, each method has its pluses and minuses when you're traveling. So it's best to take money in various forms, do some research and plan ahead. Some points to consider:
ATM/DEBIT CARD
Cost Some cards assess foreign-transaction fees (1 to 3 percent). At ATMs, you may pay currency-conversion/foreign-transaction fees plus a usage fee.
Pros Convenience. Many outlets have 24-hour access.
Cons Remote areas may lack ATMs or retailers who accept cards. Some stores and cafes may be cash only. Train ticket machines and kiosks in Europe that use "smart card" technology may not read magnetic-strip cards.
CREDIT CARD
Cost Same as debit card, but you'll also incur cash-advance interest rates of 20 percent or more at ATMs.
Pros Convenience. Accepted by many retailers. Card can be replaced if lost or stolen.
Cons Same issues as debit card.
U.S. DOLLARS
Cost Free to take, but you'll owe a fee to exchange them. Retailers who accept typically "round up" in their favor.
Pros You don't have to deal with a new currency. Merchants in some Latin American and Caribbean countries may prefer U.S. dollars.
Cons Not accepted by many retailers. Can be expensive to exchange.
FOREIGN CURRENCY
Cost You pay varying exchange rates, plus service fees to buy and exchange. Either way, you lose money in the process.
Pros Accepted by local retailers.
Cons If stolen, it cannot be replaced. Impractical to carry large amounts.
TRAVELER'S CHECKS
Cost Typically a 2 percent or so service fee to purchase.
Pros Can be quickly replaced if lost or stolen. Low risk of identity theft and loss because they are not linked to checking accounts.
Cons Some retailers may not accept them. Outlets to cash or exchange them may be scarce and open for limited hours.
PREPAID (CASH) CARD
Cost Varies. Initial fees can be up to 12 percent to load the card with cash; if you reload, you may pay again. Or you may face monthly fees of $4 to $10.
Pros Convenience. If lost or stolen, the funds can be replaced.
Cons Fees can mount up. Some retailers may not accept them.
