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Keeping Your Money Safe When You Travel

by Gabi and Skip Yetter

It was 9 p.m. on a Tuesday in London’s Streatham Hill district. We’d just had dinner and were flying to Cambodia the following morning, so we needed cash. Spotting a Sainsbury’s ATM on the way to our car, we popped in our card and waited.

No cash. Even worse, no card.

The ATM had devoured it.

It wasn’t the first time we’d had a cash emergency on the road, so we were prepared to handle it. We phoned our financial advisor in the U.S., arranged for him to send us a new card in Phnom Penh, and used another to withdraw cash until the new one arrived.

Each time something like this happens (and there have been several times), we remember the importance of a backup plan. And in our six-plus years on the road, we’ve learned lessons that have served us well. Dealing with money is an important facet of international travel: how to carry it, where to withdraw it, how to get the best exchange rate, and what to do when you have an emergency.

We left our home in the U.S. in 2010 to volunteer in Cambodia and, while we spent a great deal of time preparing for most things, we discovered there’s nothing like experience to make you figure it out.

Since leaving Cambodia three years ago, we’ve been house-sitting in Europe and Central and South America, exploring other countries that appealed to us, and writing about our experiences (mostly in our book, Just Go! Leave the Treadmill for a World of Adventure).

While our journeys have opened up worlds of adventure, not all our experiences have been good. But they’ve all been memorable.

Last year in Morocco, we were traveling through a remote part of the country with a guide when we discovered our ATM cards had expired, and we were short on local currency. Our hotel accepted only cash, and our guide’s one and only credit card machine was miles away in Casablanca. As a result, our last two hours in the country were spent dashing through the streets of Marrakech in search of a cash machine that would accept our other card, getting lost in the Medina’s mazelike streets, and almost missing our flight.

So, rule number one is this: Bring more than one credit card, and make sure you have a little cash. Rule number two: protect your cards, cash, and valuables.

The days of traveler’s checks are fading fast, and while cash machines spew local currency in almost every country, it’s important to have ready cash when you land in case there isn’t an ATM at the airport, the ATM is broken, or you need a cup of coffee or taxi fare as soon as you land. As one of our friends discovered when he visited us in France, local currency is required at toll booths, so you might find yourself stuck (or, in his case, at the mercy of a kind Frenchman) if you have only U.S. dollars or a credit card.

Here are some things to consider when you travel overseas:

Advance planning. Inform your credit card company and financial advisor of your plans. If you’re going on an extended trip, make a plan for emergency fund transfers in case your wallet goes missing. Check how your credit card company fraud alert service works. Ours has an excellent email notification service and 24-hour toll-free service that has come in handy. Once, after detecting a pattern of sketchy purchases while we were traveling in India, they instituted a fraud hold until we could verify the purchases. Unfortunately, our card was rejected when we checked into a hotel in Udaipur, so we put an urgent plea for help on our credit card company’s Facebook customer service page. Within hours, our account was back in business. (Tip: Use Facebook and Twitter for urgent communication to organizations you need to reach. They will generally respond faster than if you contact them by email.)

ATM access. The global financial network gives you instant access to your money no matter where you are, but there are still places with little or no ATM access. Don’t assume that hotels and restaurants accept credit cards. Check in advance, and plan for surprises. We have encountered several hotels and restaurants whose websites say they accept credit cards but, for one reason or another, cannot or do not accept plastic when we arrive. If you have a problem, it helps to work with a financial advisor or bank that will go the extra mile to give you back your liquidity. Stay away from ATMs that are not connected to banks (like the one outside Sainsbury’s in England that ate our card). A second card or credit card that will double as a cash source is also important.

Currency exchange. Companies like Travelex are conveniently located in airports, but their currency exchange rates are generally unfavorable, and they often charge exchange fees, so don’t exchange much cash at the airport. Instead, find an ATM at the airport or wait until you get to a bank, post office, or American Express office — or ask your taxi driver to take you to a bank ATM on the way to your destination. Avoid the change bureaus you see in touristy areas. They, too, usually offer poor exchange rates. When exchanging cash or traveler’s checks, it’s usually best to exchange your money in the country you are traveling to, not in the U.S.

Avoid black markets, which are easy to find in many countries, but may be operated by dubious characters. Also, exchange money back into your home currency — or that of the country you’re visiting next — before you leave. Last June we left Serbia for Turkey with a wad of dinars, only to learn there was no exchange service that would trade them for euros, U.S. dollars, or any other currency at the airport. Having no other option, we wound up trading them in Istanbul at an absurdly low exchange rate.

U.S. dollars may be accepted as readily as the local currency in certain countries. The currencies in Belize, Barbados, the Bahamas, and a few other Caribbean nations convert to the U.S. dollar at fixed rates, making it easy to use either greenbacks or the local currency.

Download the XE Currency app (available for iPhone and Android) before you leave on your trip. It’ll come in handy when you’re trying to calculate hotel and meal prices or assess the rates posted outside currency exchanges.

Credit cards. You’ll almost always get the best exchange rate when buying foreign currency with ATM or credit cards — from 2 percent to 7 percent better than the rates you’ll get when exchanging cash. Use your credit card for large purchases such as hotel bills, train or plane tickets, and car rentals. However, keep in mind that many credit card companies add fees for transactions made in foreign currencies. Local vendors such as restaurants and shops may also charge a fee for credit card transactions.

It is usually best to decline when a merchant offers to charge a purchase in your home currency, since they often use a higher-than-
market currency exchange rate, and it doesn’t necessarily negate your credit card’s foreign currency fees. In the end, it could cost you up to an additional 6 percent on your purchase.

Research your credit card choices. Their currency conversion fees vary as much as 10 percent between the best and worst cards. In general, American Express cards are better than average, with a 2 percent fee, but are not as widely accepted overseas as Visa or MasterCard. Discover credit cards do not charge a fee, but are virtually unheard of outside the United States.

Prepaid money cards. Prepaid cards are gaining popularity as a way to pay while abroad. They work much like prepaid gift cards. You load money on the card and spend until the balance reaches zero. You can top it off again using cash, a bank transfer, or a credit card. Prepaid cards are safer than debit or credit cards since, should someone steal it, he or she could spend only the amount remaining on it. Some prepaid cards allow you to load them up with foreign currency and won’t charge you when you use them overseas, making them even more ideal for international vacation spending.

International money quirks. Before you travel, research exchange rates and specific rules or guidelines. For example, until recently, Myanmar had few ATMs, and currency exchange services demanded pristine, unmarked $100 notes with no folds or tears. When we visited in 2012, we carried our bills between the pages of a book to keep them flat and unscathed, so we had no problem. But we bumped into a couple in Bagan whose stash of bills was old and torn or had fold marks on them, rendering them unusable. We traded some of our untarnished bills for some of their worn greenbacks so they were able to continue their trip.

Security. Even the safest neighborhoods in the most secure countries have risks, but a few simple steps will help you travel safely and securely. Make a photocopy of your passport and store it in a place separate from your valuables, credit cards, and money. If it’s lost or stolen, these copies will make it much smoother when you go to the embassy to secure a temporary replacement.

Take advantage of hotel safes and safe deposit boxes. If you’re traveling in high-petty-theft places (like Cambodia, Vietnam, Ecuador, and South Africa), where local pickpockets target tourists, don’t wear flashy jewelry or watches — and leave your purse safely locked away. Use your credit card judiciously; unsuspecting credit card users are targets for fraud. If you enter a PIN, protect it from being seen, and, if you sign for your purchase, watch vendors to ensure that they aren’t double-swiping or recording your information for later use. Regularly check your credit card transactions online to guard against fraud and abuse.

At the time of writing, we’re in South Africa, where we’re indulging in exotic meals, staying in comfortable hotels, and traveling through game parks — all at a fraction of what it would cost elsewhere. We tend to seek the out-of-the-way places where most tourists don’t go. That’s where the richest experiences await.

As far as we’re concerned, it’s worth the time and effort to step well away from the trampled paths of international tourists. And with these few simple precautions, having access to our funds while on the go is last on our list of concerns.