27 Personal Finance Tips for Overseas Travel

Overseas travel can be exciting and nerve-wracking, a dichotomy that can cloud your mind as you prepare for your trip. As you try to pull everything together for that vacation, business trip, or overseas school experience, you might forget small details that canl make your trip much less expensive in the long run. Some of these tips concern health and safety issues, as losses in that area can cost you a bundle. Other issues concern questions about whether to carry credit or debit cards, cash, or traveler's checks on your trip.

Although most colleges grill their students on how to behave on overseas trips, they often exclude information about how to handle money and, when asked, they leave those choices up to the students. In many cases, those students and some adults who travel abroad are caught in situations that can cost them financially. For instance, many overseas travelers do not know to contact their credit card companies or banks about travel plans, nor do they comprehend currency issues that exist at their destinations. Always check the currency exchange rates for your destination country before you travel.

Financial problems are exacerbated if you don't speak the country's language and if you don't understand how to access or use its currency. Most of the following tips will help you to avoid or at least mitigate these issues before you ever leave home, but others will help you maneuver through your trip with ease once you arrive at your destination.

Safety and Health Issues

1. Make two photocopies of any important papers.

   Make two photocopies of all important papers (credit cards, passport, driver's license, etc.) and leave one set at home with a trusted friend or family member. Take the other set of copies with you in your carry-on luggage. While you're at it, be sure to fill in the emergency contact information page on your passport. When you arrive at your hotel room, put all your important items in the room or hotel safe. When you leave your room, take the copy of your passport, not the original. Plus, you need to take only the credit card or other forms of monies that you plan to use on that outing.

   This action will help to limit your losses if you encounter a pickpocket or a thief. In addition, if your papers are confiscated for any reason, you can rest assured that you have copies of those records available elsewhere. If you don't trust your room safe, use the hotel safe. If you don't trust the hotel safe, plan on the purchase of a money belt or some other secure holding for your papers, cards, and money (see number 20).
   

2. Travel light (clothing-wise) and forget the bling.

   Leave the bling at home, and try to avoid any clothing that announces your nationality. The latter tip is to help you to avoid confrontations from any anti-American sentiments. Dress conservatively so that you don't stand out in a crowd. This means that you could try to dress in a casual business-like manner for travel and during weekday travel so that your dress doesn't scream "tourist." Business dress will help you avoid becoming a magnet for any individual who targets tourists for theft.

3. Find answers to your questions before you leave home.

   One way to learn about how the locals dress at your destination is to join a discussion groups like the ones at Fodor. Another method is to find a specialty group like Journeywoman. The latter site is designed for women who travel so they can make connections with other women who reside in the destination country. This type of site can help you learn more about that country including the safe spots, the dangerous places, and how to safeguard yourself in all situations. Learn a few customs so that you don't offend locals and learn simple phrases in their language like "thank you," "hello," and "excuse me."

   Also check the destination country's official site and the U.S. consular or embassy site in that country for travel warnings. However, be aware that the destination Web site may not project the warnings that the U.S. sites will, as the destination country may want to downplay any travel issues.

4. Safeguard your health.

   Don't forget your prescriptions, but be aware that some countries consider prescription medications to be illegal substances (like the U.S.). To be safe, carry a letter from your physician that states your need for the prescription and carry a copy of that prescription order so you can prove you need those medications. Also, keep those prescriptions in their original containers for travel rather than in a daily reminder-type container.

   You may not be able to replace contact lenses or glasses prescriptions while traveling. Carry extra contact lenses, putting one pair in a carry-on and the other in your checked luggage. Carry an extra pair of glasses and sunglasses, as you can be gouged for sunglasses at many tourist locations. If you have your eye prescription handy, make a copy and carry it with you in case you can replace prescription eyewear. Also check in with the Center for Disease Control' s travel site to learn more about how you can safeguard your health in your destination country.

5. Purchase travel insurance.

   You will want to purchase travel insurance and include compensation for delayed flights, cancellations, lost luggage, and any other problem that might occur. Most travel insurance policies charge just pennies more for complete peace of mind and you can be reimbursed for losses with a policy that often costs less than $20. Some even come bundled with medical insurance.

6. Purchase travel medical insurance and death insurance.

   If your travel or medical policy comes bundled with travel medical insurance, take a long hard look at their offerings. The dollars you spend here can save you thousands of dollars if you become sick or injured while traveling. These policies should cover instances where you need to be transported to another hospital or flown home, as well as seemingly simple procedures like treating a sprained ankle. Additionally, the option to fly your body home should you die is a good option to consider. Charges for medical or body transport can be exorbitant; so, be kind to your family and provide for this possibility before you leave home because the U.S. government doesn't pay for those expenses. Make copies of these papers and leave them with a trusted friend or relative. Also, consider the creation of a Power of Attorney in case you become incapacitated during your travels.

   Although the previous information may sound dire and possibly unnecessary for your situation, a report issued by Johns Hopkins Associates might change your mind. In it, they state that most Americans who die overseas do so in developed countries of Western Europe, where most Americans live or visit. The causes of death are similar to those in the U.S. (heart attack, accident, murder, suicide, etc.). The deaths of Americans in less developed countries are not from infectious and tropical disease, as many health professionals would expect, but are from chronic diseases, injuries, suicides, and homicides.

7. Continue to cover your assets.

   Purchase property insurance for equipment such as cameras, binoculars, laptops and other items. If you already carry insurance on these materials, check with the insurance company to make sure that you're covered for an overseas trip. The travel insurance that you purchase might cover these items as well, so read the fine print carefully before you purchase more insurance than you really need.

   Laptops provide special problems these days, as customs in various countries are concerned about where you obtained the laptop and what you have on it. While you probably won't encounter problems leaving the U.S., for instance, you might experience some hassles upon your return. If you register laptops, cameras, etc. with customs before you leave on your trip, you'll avoid possible duty fees upon your return.

8. Get phone numbers.

   You may not realize that 800 numbers work only in the U.S. and Canada. Before you leave, call your bank and credit card companies to get local (non-800) numbers so that you can call them in an emergency. Also, get numbers for the U.S. Embassy located at your destination in case you lose your passport or other important papers. Better yet, you can register at the Department of State online before you ever leave home. If your money is stolen, you can count on that consulate to offer a small loan for you to function until you retrieve more funds. Plus, if something does happen to you while traveling abroad, the the Bureau of Consular Affairs must locate and inform the next-of-kin, but they can only do that if they know how to reach them.

   Unfortunately, a Catch-22 is involved if you need help from an overseas U.S. consulate. You must show proof of citizenship before they will help you. This is why it's so important that you make copies of that passport, travel visa, driver's license, etc. Even if the only copies you have are the ones at home, those copies can be faxed to that embassy.

   If you plan to travel to a country where there are no U.S. officials, you should register at the U.S. embassy or consulate in an adjacent country. They can inform you about what you will need to do in emergency situations.

9. Purchase an international phone card and open an accessible email account.

   Six months after a major hurricane visited the Bahamian islands, one island's cell phone tower remained dysfunctional. The only way to call out to other islands or to the U.S. was by phone card and the use of landlines. Make sure that you purchase a card that can be used from the destination country and that it can be used to call numbers inside the U.S. in case of emergency. Some cards can be used in the U.S. upon your return, so you won't waste money on the purchase of that card.

   On the other hand, why call when you can email someone? Many foreign countries now support "email cafes" that you can use for a minimal fee, especially in cities and even in smaller towns. In this case, you want an email address like Gmail or Yahoo! so that you can use that email interface from any location.

10. Plan your itinerary before you leave home.

    Nothing says "rude and insecure tourist" like a person who pulls out and opens maps in the middle of a crowded plaza and who blocks foot traffic in the process. Plan your trip before you leave home, and become familiar with airport, public transportation, and city layouts before you reach your destination. Granted, standing in the middle of Heathrow Airport is far different than looking at the Heathrow terminal maps online. But, at least you can begin to understand that the planes may arrive at one terminal, you might need to go through customs in another terminal, and that public transport can be reached from a separate terminal altogether. This information can make you appear more confident and less of a target for thieves and scam artists.

Financial Issues

1. Travel light (financially) and carry a spare card.

   While traveling, keep cash in hand limited to less than $300 in that country's currency and carry just one credit and/or debit card to limit what can be lost or stolen. But, it is a good idea to carry a spare card in case something happens to that first card. Keep the second card locked away for safekeeping once you arrive at your destination.

2. Decide whether you want to use traveler's checks.

   Some folks feel comfortable with the purchase of a traveler's check or two as a means to gain access to money while they're abroad. However, fewer merchants accept traveler's checks these days. Additionally, the fees associated with cashing these checks overseas are often higher than fees for overseas credit card use (see below). With that said, traveler's checks can represent the safest form of travel funds, as a reputable company that issues those checks will usually reimburse you within 24 hours if the checks are lost or stolen. Make sure that you copy the phone number, check numbers, and any other information before you leave. In addition, leave one copy at home and carry the other copies on hand but separate from your actual traveler's checks. Read more about traveler's checks and cards at the Independent Traveler.

3. Check your ATM, credit and debit cards before you leave.

   Be sure to test your cards before you leave home to make sure that they work. Check the expiration date on the cards to make sure they won't expire while you're gone. Additionally, use a four-digit numeric ID for that card's PIN and commit that number to memory. Many ATM machines located outside North America only support four-digit PINs and they don't support letters on their keyboards, or the keyboard may seem unfamiliar because the letters and/or numbers may appear in a different order. If you use an alphabetical PIN, make sure that you know the numeric equivalent before you leave home.

4. Inform credit, debit, and ATM card banks and companies about your travel plans.

   Inform credit, debit, and ATM card banks and companies about your travel plans, but only those companies that you plan to use. Some credit and debit card companies may not allow you to use a card overseas at all, and some may freeze your account when you try to use it overseas unless you've informed them of your plans.

5. Get information about fees and charges for overseas card usage.

   These phone calls to your credit card companies will take a while, as you also need to ask the card companies about their fees for overseas usage. Some cards will charge the usual percentage rate on your balance, but they may also charge a 1% fee for foreign usage in addition to 2% currency conversion fees for foreign purchases made with their credit cards, debit and check cards, as well as ATM cash withdrawals. Once you have information about those fees, you will know to take only those cards with the most travel-friendly policies.

   You can be hit with currency conversion fees even when you purchase goods from a foreign merchant or from an international Web site from your U.S. location. If you want to purchase overseas rail tickets or tour packages for your trip, for example, you might check to see if that vendor maintains a U.S. office. If you go the U.S. route, you might be able to bypass those charges. To be on the safe side, you might use that company's U.S. phone number to make your purchase.

   Despite overseas credit card usage fees, it pays to charge if you plan to have a purchase shipped home for you. Hold onto those credit card receipts because you can dispute the charges if the item arrives damaged or not at all.

6. Consider a new card for an extensive trip.

   If you plan to take an extensive trip overseas, you might shop around for a traveler-friendly credit card. Capitol One provides the best foreign-travel reputation because they continue its popular policy of charging zero conversion fees and they absorb the 1% fee that Visa and MasterCard charge to process purchases. Discover does not charge a fee and American Express card fees depend upon who issues the card; however, you'll discover that these two cards aren't accepted widely in foreign countries. In fact, the Discover card is basically useless in Europe.

7. Check for overseas partner banks and consider a debit card.

   Some major U.S. banks partner with overseas banks. If this is the case for your bank, ask them where those banks are located at your destination. The use of a partner bank may save you from paying ATM fees to your hometown bank. If you want to use your ATM or debit card overseas (also called a "secured card"), make sure it contains a Visa, MasterCard, Cirrus, or Plus logo, because those cards are used internationally. If you use a Cirrus/Plus card without a Visa/MC logo you might avoid the Visa/MasterCard fees for foreign use and currency conversions.

8. The overseas ATM and your debit card.

   When you use a foreign ATM, it acts just like an ATM at home. The foreign ATM, however, will spit out your cash in local currency using current exchange rates. Make sure that you use the credit or debit card that offers the lowest foreign transaction fee in that machine (usually the debit card). Withdraw enough money to last for a few days to avoid overusing the machine and its charges for each withdrawal.

   Beyond the ATM card issue, many ATMs located in foreign countries won't charge a usage fee as long as that ATM is associated with a bank. As in the U.S., it's often much safer to use an ATM that is associated with a bank rather than a privately owned ATM, as the bank would be easier to contact if problems occur than would the private company. Prior to travel, verify that your financial institution participates in all the networks listed on the back of the card that you plan to purchase and discover what limitations might apply to that card.

9. Consider pre-paid debit cards.

   Pre-paid debit cards are safer than regular debit cards because pre-paid cards aren't connected directly to your checking account. Purchase a card with the amount of money you think you might need and use it in ATM machines while you travel. If you lose the pre-paid card or if it's stolen, you won't lose the entire balance in your checking account as you might if a thief gains access to your regular debit card. But, fees do add up with this type of card. The pre-paid card usually comes with a purchase fee, reloading fees, international transaction fees, and cancellation fees, among other possible charges. Plus, this card may be difficult to replace when you're overseas.

10. Consider a money belt.

    A money belt provides great peace of mind as you travel. When you use a money belt, you don't need to worry about falling asleep on the plane or about pickpockets while you stare at some local artifact. Another option is a neck pack, where important papers, cards or money are stored in a pack that hangs from your neck and that you can tuck away under your shirt or blouse. Check out what others say about money belts and other alternatives at Fodor.

    Money belts aren't normal bits of clothing, so practice wearing the device before you leave. Two tips for money belts: Put all contents into a plastic bag so that sweat won't soak the paper inside the pouch (you can purchase money belts with plastic linings, and silk money belts are more comfortable than most other types). Also, never try to get your money out of that money belt in public. The purpose behind that pouch is to keep your valuables secret and safe. Pull out any cards or cash you might need for your outing before you leave the hotel room and keep those items in a deep pocket.

11. Learn to loop.

    Another tip that will help you to safeguard your purse or a carry-on bag is to wrap the strap around your ankle while you sit to eat or sleep. If someone tries to make off with that bag, the tug on that strap will alert you in a flash. Be aware of distractions that take your attention away from the activity at hand as well. Disturbances in public places might be staged for pickpockets and thieves to work a crowd.

    Finally, be aware at all times. While online, you might read stories about people who had purses and other items stolen as they stood at a hotel desk to check in. You wouldn't leave a purse or laptop sitting on the floor in a busy hotel lobby in a U.S. city, so don't leave one sitting on the floor in a foreign hotel lobby.

12. Learn about the Dynamic Currency Conversion (DCC) process and avoid it.

    Some foreign merchants may capitalize on your currency confusion and offer their prices in U.S. dollar amounts, or they might offer to convert your purchase into U.S. currency. Although this DCC practice might seem tourist-friendly, those prices are usually based upon inflated currency rates. These prices may drive the price up 3-5% over the local price. When you decide to purchase an item on DCC with your credit card, you could take on even more percentage points to the final price.

    You can ask to have the price of the item you want converted back to local currency. If the merchant refuses or states that he or she doesn't know how to convert the rate, ask for the manager or simply refuse the purchase. Visa requires that you are provided a meaningful choice at the point of sale and you have the right to buy your purchase in the local currency so that you do not incur any additional fees the merchant may assess. Visa also requires merchants who offer this service to inform you of the exchange rate including any applicable commission being charged.

    Finally, although Visa and possibly other issuers require a meaningful choice, be sure to check your receipt before you walk out the door. If the item was charged in U.S. currency, you can ask for a new receipt in local currency.

13. Purchase some foreign currency at your local bank just before you leave.

    Your local bank might have a branch at your departing airport, or you might stop at the bank on the way out of town. You need just enough money to get to your hotel from the destination airport and possibly enough for one meal. The reason I say this is because there have been times when students are hustled straight from their baggage pickup to the hotel and then from the hotel to their first classes or tour with little to no time to access an ATM.

    I also advocate this step because I operate on the "worse case scenario" mindset. In this case, the destination airport's ATMs are out of order, it's too late and all the banks are closed, and there's a line a mile long at the money exchange booth. Criminals may watch for and target international travelers purchasing large amounts of foreign currency at airport banks and currency exchange windows as well. I'd rather pick up my luggage and head straight to the hotel room. A limited amount of foreign currency on hand allows that luxury.

14. Avoid Cash-to-Cash machines.

    These machines are popular in Europe, and they look just like an ATM. But instead of feeding a card into the machine, you feed money into these machines and they spit out a currency exchange. These machines are so convenient and prolific that you might be tempted to use one. However, you might regret your choice as these machines usually operate on inflated exchange rates and often charge fees for the exchange (which is taken out of your input).

15. Use cash whenever possible.

    You'd be hard pressed to find a merchant anywhere (even in the U.S.) who would prefer a credit card over cash. Merchants pay fees to use credit cards, whereas cash-in-hand is fee-free for that merchant. Therefore, you might discover that many overseas merchants won't accept credit cards. Additionally, you can often find your best bargains at street markets or with merchants who are willing to haggle. You can't haggle with a credit card, so don't even try.

Other Issues

1. Hotel rooms

   Try to get a hotel room between the second and seventh floors for bodily and financial safety. Most fire departments don't have equipment that will reach above the seventh floor and lower floors are susceptible to thieves, especially if those rooms have sliding glass doors and/or easily opened windows. When you check in, study hotel uniforms so you can recognize them. You can always verify hotel employees with the front desk before permitting that person's entry to your room. On the other hand, accept the bellman's assistance upon check-in, as that person can open the door, turn on your lights and check all rooms before you enter.

2. Public transportation saves money.

   Public transportation is usually safe and may be the easiest and least expensive way to travel, especially around Europe, Australia, and other developed countries. In fact, some of these countries maintain more elaborate systems than those found in the U.S. Learn about available systems that operate at your destination and learn whether you can purchase special deals through ticket packets, seasonal deals, or other options before you leave home.

If you're a seasoned overseas traveler, you probably know other travel tips and tricks that work for you. Additionally, some tips are more relevant to some countries than others. There's nothing like the first trip overseas to shake up your idea of the world as you know it and each country you visit will help you to learn new travel tricks.

To help overcome "newbie" jitters that are generated from overseas trips, learn as much about the country you intend to visit before you go. And, despite any attempts at dressing like the locals, as soon as you open your mouth the locals will know that you're the foreigner. But, if you voice positive comments about that country and keep negative comments and criticism to yourself, you can help to make your trip much more enjoyable and safer all around.