The days when travelers used to rely solely on cash or checks when going abroad are long gone. Today, the same credit card you use at home can also work for you in other countries. However, there are still some things that you need to know.
You can likely use credit cards for your daily expenses if you’re heading somewhere that gets many US travelers. While cash may work for tipping and other incidental expenses, you’d still want to use your credit card for significant spendings such as car and hotel rental.
That’s due to the fact that purchasing through a credit card with no associated foreign transaction fees while traveling abroad can help you track spending, maximize rewards, save money, and more. However, before boarding, it’s essential to do some research on your options regarding credit card usage for international travel carefully. Always remember that credit cards may vary in terms of the benefits they offer.
Below are some tips on how to maximize the use of your first credit card when traveling.
Choose And Bring A Credit Card That’s Widely Accepted
Mastercard and Visa are the most widely accepted worldwide. So, when choosing a first credit card, it would be best to opt for either one of them. There’s a high chance that your Mastercard or Visa will work if an establishment overseas accepts credit card payments.
Although American Express also has an international presence, it’s accepted by fewer merchants. You can still bring an AmEx as your primary card, but be sure to bring a Mastercard or Visa backup. The least acceptable card network internationally is Discover, so think twice when you have plans of bringing one when traveling.
Tell The Issuer Of Your Credit Card Where You’re Going
Chances are the issuer of your card will decline purchases and mark them as suspicious if they suddenly notice spending taking place thousands of miles from home. To avoid confusion, inform the issuer of your credit card account about your travel itinerary. Do it before leaving the country to prevent possible freezing of your account.
Understand How Foreign Transaction Fees Apply To Your Credit Card
When talking about international travel and purchases, credit card issuers can vary greatly in terms of the benefits offered. The first credit card that you can always count on at home when it comes to making money through amazing cashback rewards might not work well for you on your upcoming overseas adventure.
Before using your credit card, make sure to understand how the company that issued it may apply fees for foreign transactions. Unless the issuer waives these fees, you’ll end up paying more for the things you buy than the advertised price.
Note: Please take note that such charges could easily add up quickly, especially if you’re going to use your first credit card for your car and hotel rental.
So, how would you know whether or not your credit card charges fees for foreign transactions? Also, how do you know how much they charge if they’re going to do it?
The best thing to do is to call the card issuer and ask. You can also check their website for any information about it. If, for instance, the issuer of your card charges a fee for every foreign transaction, you can apply for a credit card with travel rewards that can waive these costs.
Make Sure That Your Credit Card Is Chip-Enabled
Today, credit card issuers have already started to transition to chip-enabled ones. Most US consumers are used to swiping their cards instead of dipping. However, in other parts of the world, especially in Europe, shoppers have been dipping for years.
They even possibly enter a PIN, too. What that means for you is that you have to make sure that your credit card is chip-enabled. It will save you from a headache once you find foreign checkout clerks not knowing what to do with your mag-stripe card.
Also, if you have either a chip-enabled card or a mag-stripe credit card, always keep local currency with you. There can be payment kiosks in locations like toll booths or parking garages that are unattended and may not accept your cards.
Don’t Use Dynamic Currency Conversion
What’s a dynamic currency conversion? It allows you to conduct transactions in US dollars rather than your destination country’s local currency, so you’ll have a better idea of how much it costs. It’s expensive, no matter how convenient it may seem.
Dynamic currency conversions use exchange rates that are typically worse than the one your card issuer uses when converting the purchase to be part of your statement. That said, it’s better to pass when receiving an offer to have the chance to see your total spending in dollars.
Learn About Your Credit Card’s Travel Protections
There are credit cards that offer protection for accident insurance, trip cancellation, lost luggage, delayed flights, and more. This is especially true for those cards that are designed for travelers. When booking with your first credit card, choose the one that can provide you with this kind of peace of mind.
Conclusion
Whether you’re flying to Tokyo, London, Philippines, or anywhere in between, go back to the tips covered above. They can help to smooth your way. Your first credit card should give you comfort when traveling, not make things complicated for you.
