How to Use Your Credit Card Overseas Safely

by Neal Frankle, CFP ®

If you use your credit card overseas, you know what it feels like to be taken to the cleaners. Many tack on as much as 3% on every transaction. Others have a fixed fee every time you use the card overseas or hit the ATM. If you spend $5,000 while you’re on vacation, these credit card costs could rack up several hundred dollars in extra costs. Mon Dieu!

Many people worry about getting the best cards with the most rewards points. But if you travel, you have to think about minimizing your costs as well. Fortunately there are a few simply steps you can take to keep that money out of the credit card company vaults and in your own pockets. Here’s how:

1. Flex Your Power

If you have an excellent credit score, realize that the credit card companies love you. They desperately want customers like you and are often willing to waive all kinds of fees in order to get your business. Before you say “Bon Voyage”, call your credit card company and ask about foreign transaction fees on card purchases and ATM withdrawals. If the company does impose fees, ask them for a waiver because of your outstanding credit rating. If they won’t play ball, start using a different credit card.

Don’t waste time trying to read the fine print of the credit card contract. Just give them a call. Get the information and jot down who you spoke with.

2. Probe

If your credit card issuer is also a bank, ask about the ATM charges for foreign branches. Also, find out if your bank has an arrangement with a foreign bank so that you can use those ATMs free of charge. Remember to ask about ATM fees but don’t stop there. Find out about access fees, international transaction fees and foreign currency fees. These guys are sneaky so make sure you ask all the questions.

3. Be Smart

Minimize your use of cash overseas but when you do need some spending money, don’t use your credit card to get it unless it doubles as an ATM card. That’s because you could be charged north of 20% interest until you pay that credit card bill. Aye Caramba! Ay Yay Yay!

4. Double Up

Always take a second card. I learned about the importance of this the hard way. We were traveling recently and the credit card company didn’t know about it. They thought some “paisan” in Italy had stolen our card and was roaming the canals of Venice on our dime. As a result they locked the card down.overseas credit card

This was fine except that I didn’t know about the lock down until I was trying to buy a ticket to visit the Vatican and couldn’t use this credit card. You can imagine how I felt when my first card was declined. Fortunately, I had a second card and we were able to continue our trip.

Even if one of your cards doesn’t get locked down, you could run into a vendor that doesn’t accept one card or another. And overseas fraud runs rampant when it comes to credit cards. Your card could be shut down at a very inopportune time.

5. Share

If you are going to travel let your credit card company know about it. This will help you avoid the situation we faced in Italy. When they see the charges coming in from overseas your company will understand why you are in Paris instead of Pittsburgh. This way they will allow you to keep using your card. Tres Bien.

6. Just in Case

Most cards have contact numbers on the card itself. But that doesn’t help if your purse or wallet gets stolen. If you look at your credit card now, you can find the contact numbers both in and outside the United States. Keep those numbers in a safe place other than your wallet or purse.

When you are on vacation overseas, let your hair down a little and focus on fun. That’s as it should be. But take these few precautions anyway to make sure nothing keeps you from having the best time possible.

What other tips can you share with regards to using a credit card overseas?

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{ 3 comments… read them below or add one }

Neal Frankle February 25, 2013 at 7:44 AM

Freddy,

Right….the same thing happened to me but it sounds like it won’t happen to either of us again. BOOYAH!

Reply

Fred@Foxy Finance February 23, 2013 at 9:04 AM

I didn’t notify my bank I was travelling and they decided to block transactions. It was such a stress and not what I needed while trying to enjoy Antigua!

Reply

Pollyanna February 22, 2013 at 7:27 AM

I always call my credit card company when I am traveling, even from state to state in the US if I anticipate a large purchase ($ or quantity) at my destination. They’ll allow lower $ transactions, but then a clip level is hit and it declines. And keep credit cards separate — if wallet/purse is stolen, you can still get to your back-up card. My husband and I are planning an overseas trip this summer, your tip about asking for fees to be waived is a great idea, we have a solid record with our credit card company.

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