- 1 A Little Advice…What’s in Your Travel Wallet?
- 2 American Express Bank, FSB Reviews
- 3 Charles Schwab ATM Card – Your Secret Weapon to Accessing Cash for Free Anywhere in the World
A Little Advice…What’s in Your Travel Wallet?
Stepping away from travel stories, I wanted to share focus on the practicalities of traveling long-term and talk about handling money abroad, as well as which credit and debit cards rank as traveltasticly special.
**This post was updated in January 2016 to reflect new credit and debit cards on the market and my honest opinion on what I find works best.**
Together, my cards and I have been through the good (no withdrawal fees), the bad (two percent transaction fees) and the ugly (whaddaya mean I can’t make a withdrawal or transaction in Slovenia… but I’m IN SLOVENIA). After more than six years traveling, I learned that finding seamless banking solutions made a huge impact on my travels at the end of the day. Many lessons were hard-learne, so here is how I handle money on the road.
Travel Considerations for Credit & Debit Cards
- Transaction Fees: What is the percentage for transactions made on your credit card, and on your debit card when it’s used as a credit card (swiped and not used at an ATM)? Find this number for your current card and write it down so you can compare.
- Withdrawal Fees: Many banks charge a flat fee every time you use an international ATM. Ask before you leave.
- Are any countries blocked?: Back in 2008, my credit union blocked Thailand and Slovenia because my bank designated them as “highly likely for fraudulent activity.” Now that I switched banks, this is no longer an issue.
- Online Banking: This is a no-brainer, but you really should be able to get access to your account balance abroad—particularly important for long term travelers.
- Carry different brands: You should have a Visa and a MasterCard, some countries more widely accept one over the other.
Does my debit card company really matter?
A resounding yes! Many banks charge a foreign withdrawal fee every single time you use an ATM outside of your country. Depending on the rate (some are even over $3 per withdrawal) it swallows up your savings. These fees add up over time and can easily be avoided with research ahead of time.
My Saving grace: Schwab Online Banking
Charles Schwab is a completely online based bank and they have unparalleled advantages for travelers—better than any other US bank I’ve heard of yet.
- No foreign transaction fees.
- No ATM withdrawal fees.
- They reimburse withdrawal fees from other banks!
- They’re online so they’ll never ask you to come into the bank branch to pick up your replacement for a stolen card while you’re sitting on a beach in Thailand.
- Customer service over the phone has always been a cinch, and email responses to questions are fast.
- It’s completely online, so if you’re like me, you sometimes like to have a human to point at and make ugly faces to when things are going wrong. With Schwab you’re left making faces into the phone. Somehow less satisfying.
- BUT, they do have investment branches in most US cities and they warmly welcome walk-in banking customers who have questions (just no actual banking).
- I hear that transferring funds around is difficult (read through the comments); I don’t do any of this, I direct deposit my paychecks and leave it at that, so this could be true and a drawback if you juggle funds from many accounts.
Final Thoughts on Debit Cards
When I left on my RTW trip the economy was at the beginning of the recession and I was moderately content with the $1 foreign withdrawal fee tacked onto ATM withdrawals from my Credit Union bank account. Fast forward nine months, the recession hit hard, and my Credit Union upped the fee to $2.50 per withdrawal. Once I got back to the US I switched to Schwab and they have lived up to their fee-less withdrawal promises throughout 20+ countries. At the end of every month Schwab deposits a reimbursement for fees into my account; considering that Thai banks charge $5+ per withdrawal, this was always a significant reimbursement each month. It makes a huge difference to have that single asset on my checking account. I just love the Schwab card and truly recommend that you travel with it above most others as your primary bank card. They have a great online interface and truly refund you every single foreign withdrawal fee.
Credit Cards for Travel—Necessary or Folly?
I rarely support going into debt to travel, and credit cards fall into a dangerous territory if you’ve ever abused them in the past. That being said, things happen and it’s wise to travel with a credit card. They come in handy and should anything happen to your bank account (like no freakin’ withdrawals in Slovenia!), you have a back-up and some surety. I use a credit card for things where cash won’t work and I don’t want to swipe/risk my bank card (I rented a car in South Africa and was so glad that I used it instead of my bank card since they overcharged me and it took months to resolve!)
My Saving grace: Chase Sapphire Preffered
I switched to Chase Sapphire Preffered in the summer of 2013 as a way to earn enough miles to pay for my flights to Africa. The card has a great signup bonus as well as attractive ways to earn miles and great international policies. It does carry an annual fee, however, so this turned out to be right for me, but read on to decide if you’re better off going with a non-rewards card, which has no fees and could be better for a RTW trip.
- No foreign transaction fees tacked onto international purchases.
- 40,000 bonus miles if you meet the spending requirement in the first three months, then miles deals the rest of the time.
- International customer support.
- Full online access and great interface.
- After the first year the Sapphire card carries an annual fee, so it’s best if you are playing the game of using the card to earn miles, otherwise you can get the same benefits with no fees.
- Rewards cards—like the airline miles credit card—carry higher fees so if you’re prone to carrying a balance on your card, go with a credit card that has lower fees.
Another option I have used in the past is Capital One. CapOne is a frequent traveler choice because they don’t have foreign transaction fees. I carried this card until 2013, but I hated their customer service so I find that I usually just leave it at home and stick with my Chase Sapphire instead since it earns me miles. That being said, Capital One has consistently been the one North American credit card that never charges international transaction fees. And it’s true, I carried my CapOne card throughout all 14 countries on my RTW trip and it worked in every single place. It doesn’t have any annual fees, so it could be a good option.
Final Thoughts on Credit Cards
I carry my Chase Sapphire credit card in my arsenal because it lacks the international transaction fee and I earn miles. There are other Chase cards without the annual fee, but still with the great Chase customer service, so you could do some research there. This is a murky area because there are so many credit card options out there. I don’t really play the travel hacking game, but if you’re looking to learn more about travel hacking and using your credit card to earn miles, I recommend you read up at Chris Guillebeau’s dense resource page, or dive into the vast resources on The Points Guy.
Other Credit Cards Inside and Outside North America
These two companies work for US-based travelers. I have no experience with these other companies but have heard and read good things about their travel policies:
- ING Direct: Read through the comments below, other people have raved about the ease of money transfers and service.
- Capital One Direct Banking: Also comes highly recommended in the comments for their easy online interface and no transaction fees.
- Caxton FX Global Traveller (a prepaid MasterCard – I know nothing about it, but RTW travelers have raved)
Any other great travel-friendly cards out there? What do you take abroad?
Disclosure: I have no degree in finance and I give you no guarantees on using these companies. This is just a personal, friendly recommendation from a fellow traveler; no more and no less. 🙂 Oh, and no one paid me to recommend their cards so these recommendations come from personal experience and reader feedback.
American Express Bank, FSB Reviews
From Account Holders in the last year
ADDITIONAL RATINGS YOU MIGHT FIND HELPFUL
3.5 out of 5 stars
3 out of 5 stars
These reviews were written by current and former account holders in the last year.
Just read the last review by savingsguy
Was this review helpful?
Personal Savings account has been good
I have had this account for several years. It has a high interest rate compared to the market though not the highest. I also have several other savings accounts so I don't depend on this for everything. I largely put money in this for keeping and not spending. I also like companies that have great customer service. After Amex started a relationship with Charles Schwab for a co-branded credit card, I applied for that credit card and now I can access my amex personal savings from clicking to my amex account from schwab. It is almost like my amex personal savings is a Charles Schwab savings account :). That is great because Charles Schwab, while great for investing and checking, doesn't have a great savings account. Likewise, the Amex personal savings doesn't have investing or checking. That said, the Amex Schwab Credit Card and Amex Personal Savings are a perfect fit for the Charles Schwab checking and investing accounts.
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I've had my account for several years and haven't had a problem. I do have to plan my withdrawals and allow about 3 days for the funds to appear in my local bank, but they pay one of the highest interest rates I've found.
Live only had to call customer service once, to get a form to designate a beneficiary. They sent the form right out.
Charles Schwab ATM Card – Your Secret Weapon to Accessing Cash for Free Anywhere in the World
For those of you planning to travel internationally in the near future, I’d like to share a little more detail on the Charles Schwab VISA debit/ATM card in my wallet. I will tell you why it is the best ATM card to have and how you can start taking advantage of it in a few easy steps.
Typical Cash Withdrawal Abroad
I briefly mentioned how this card saved us money when we needed cash in Italy and South America. Many places abroad, including well-known sites, accept only cash. Most international travelers typically access cash in the following 3 ways.
- Buy foreign currency (FX) from your bank or an agency like American Express (Amex) Travel, prior to a trip abroad.
- Utilize airport FX exchange services.
- Use your US bank-issued ATM cards abroad.
Here is how you’d normally be charged for the above 3 methods.
- Even when your bank or Amex Travel tells you that there is no fee to buy FX, a 3-5% surcharge is embedded in the exchange rate used (you can get a sense of what the market exchange rate is by entering “1 Euro = ? USD” in Google).
- Similarly, the service charge and unfavorable exchange rates used by those airport services are outrageous (could be higher than 10%).
- US banks typically charge a flat fee ($3-5) + an embedded 3% FX fee for your cash withdrawal abroad. If you are a premier banking customer or if you use the bank’s international branches’ ATMs, the flat fee is usually waived but the 3% hidden fee is still charged. Additionally, most ATMs abroad will also charge you a flat access fee.
Cash Withdrawal with the Charles Schwab ATM/VISA Debit Card
Now, the Charles Schwab ATM card not only charges NO explicit or hidden FX fees for cash withdrawal anywhere in the world, it also REIMBURSES the fees charged by the ATMs/ATM owners, with no limit.
Let me share a few of my actual cash transactions.
(1) Lake Como (Varenna), February 21, 2011 – Withdrawal of 30 euros with no fee charged by the ATM – @the market rate of 1.36566.
(2) All three cash withdrawal activities in Peru and Chile incurred flat fees charged by the foreign ATMs. The fees charged represented 7.4%, 3.4%, 9.1% of the total US$ amount shown below.
On May 31, 2012, the fees of $15.82 were credited back to my Charles Schwab checking account, as shown below.
(3) Just to show you a domestic example, I withdrew some cash from a local Chase ATM, and was charged a $3 fee by Chase. The fee again was credited back to my account at the end of the month.
I looked into similar products offered by a few of Charles Schwab’s competitors, and couldn’t find anything identical.
E*Trade and TD Ameritrade only offer ATM fee reimbursement for US domestic cash withdrawal.
Our beloved American Express Prepaid Card waives its $2 ATM fee once per month, but does NOT waive or reimburse any fees charged by foreign ATMs. I am also not convinced that the FX rate it uses to process foreign transactions does not include an embedded charge, but will be happy to test it out by comparing it to another fee-free credit card the next time I travel abroad.
The Fidelity VISA Gold Check Card charges a 1% FX fee, and limits ATM fee reimbursement to $75 per year, as shown in the official terms & conditions below.
You Don’t Have to Change Your Primary Bank to Take Advantage of This
Even if you don’t have a Charles Schwab branch near you, you can still get your own Charles Schwab ATM Card by following the easy steps below.
- Open a single or joint account online at schwab.com (a linked fee-free brokerage account will be opened concurrently but does not require any funding).
- Return the signature page.
- Receive your free checks, free VISA ATM/Debit card.
- Fund the checking account only when you want/need to by using the Schwab app on your smartphone, sending in/dropping off a check, or linking your Schwab checking account with your primary account for easy free online transfers.
- Withdraw cash anywhere anytime you want to.
Now, you will never have to take any foreign currency with you before your international trips! (Remember to still put all your spending abroad on a credit card with no foreign transaction fees, whenever possible!)
Let me know what you think! I respond to all comments.
As much as we love using a credit card for points and miles unless you have a European style card with a chip and pin required card it is best to use cash in Europe. My daughter spent a semester in Italy and the credit card fraud was more than we could have ever imagined. We do use credit cards for hotels, for everything else we use our Schwab ATM for cash.
Lacour, thanks for your insightful comment. Chase and Citi have started offering premium cards with chips in them, but those are still chip & signature, not chip & PIN.
Thanks for the post. I do have a upcoming trip to Italy and for this purpose I ordered a Fidelity Gold card. Before reading your post, I thought that’s the best card in universe..
GC, you are welcome. Hope you still have time to order the Schwab card before your trip. Have a wonderful time!
Very helpful, thanks!
Glad you found it helpful, Bella. Have a nice day!
Yes, Mr. RTC, we have been using Schwab ever since we moved back from Asia. I remember you also recently got a smartphone. Don’t you love depositing checks with your phone? Thanks for reading and commenting!
Oh, by the way, I just realized one limitation of using Schwab as your primary bank. Schwab does not seem to have a SWIFT code for receiving wires from accounts outside the US. Not that we need to use that, but for those who do, this could present a challenge.
Here are instructions for wiring in from any currency pretty much, using the global swift system
Does it matter which checking account you sign up for?
oneeyejack, there is only one type of checking account to sign up for – the Investor High Yield Checking, which is opened in conjunction with a Schwab brokerage account. The Investor High Yield account comes with the Schwab Bank Platinum VISA debit card. The current interest rate for that account is 0.15%, while close to zero, still much higher than what you can get elsewhere.
i just signed up. do I need to order a card or they sending me one automatically.
sorry bout that didn’t read down far enough
Thank you for all your hard work! I just applied for this card and it will be perfect for my trip to London in November.
Leigh3950, you are very welcome. Have a wonderful trip!
This sounds great! Though, we’ve also gotten cash through Amex Platinum’s emergency wire services and transaction fees are all waived for Platinum cardholders through Premium Global Assist. It takes a bit more time (verification processes), but it’s another benefit.
Thanks for sharing, Noah! Amex Platinum recently got rid of its foreign transaction fees, and I only have positive things to save about Amex customer service.
Bravo – this card saved me a small fortune on an extended 3 year overseas trip VS my main bank atm which fleeced me by charging a overseas convenience fee, awful fx rate
Quickroute, thanks for sharing your experience. Yes, this would be a perfect card for US expatriates working overseas!
It seems that although the brokerage account can be funded easily by electronic transfer from a different bank; the checking account can only be funded via check or by transfer but only from the linked brokerage account, and it takes 1-5 business days.
Ypcc, you are absolutely right! If you set up the linkage on Schwab, it is between the brokerage account and your external bank. Once that transfer is done, you can then transfer the money into your checking account. Alternatively, you can set up the linkage from your primary bank (even from Amazon Payments or Paypal, for example) and initiate a transfer from your external account.
I personally just use the Schwab app on my phone to deposit checks directly into the checking account (you could write a check to yourself and then deposit it on your phone), which usually takes a few hours.
I have a Charles Schwab card, too, because I just started studying abroad in Spain. I’m very happy with the service so far! But I was wondering, do you know if I use my Visa ATM card at a store or business to purchase something with the card itself instead of with cash, am I charged any additional fees? Or is it still just the market exchange rate? Any help would be awesome!
Shannon, I have never used it as a debit card for purchases. If you have a small purchase, you might want to try it to find out and then let us know? Otherwise, maybe an email to Schwab Bank customer service? Have fun in Spain!