When you’re traveling, you need to have constant access to your funds to stay safe. However, many banks will charge you a great deal of money if you are looking to take money out of your account using a foreign ATM. Yet if you familiarize yourself with some of the policies of banks that are the most friendly towards travelers, you can avoid ATM fees and save a lot of money while you’re traveling. As a traveler, you’re three major goals as far as banking goes should be as follows: evade any type of bank fee, avoid charges for foreign transactions, and find the best possible exchanges rates when you are converting between currencies.
If you’ve never been hit with massive amounts of ATM fees in a short period of time, you’re probably not aware of just how much of your funds this can take up. Every time you pay a fee, things add up. One fee alone can be as much as $6 or more, so you really need to pay attention to the funds that are coming out of your account each time you make a withdrawal. Before you know it, your financial fees might almost be adding up to your lodging or Monaco real estate prices. Your stops at the ATM are likely to be even more frequent when you’re abroad, and a fee of $5 per withdrawal could cause you to have to pay out several hundred dollars per year in fees.
ATM Withdrawal Fees
So how can you avoid ATM fees? One simple and easy solution to avoiding fees is choosing a bank that is part of the Global ATM Network. Banks that are part of the Global ATM Network do not charge fees on ATM withdrawals. Although fees on withdrawals for accounts with these banks are high if account holders make a withdrawal at an ATM outside the Global ATM Network, there are no fees for account holders at partner ATMs. You can find out which banks are part of this network by visiting the Global ATM Network Wikipedia article.
Another options for Americans is opening up an account at Charles Schwab. This is a fantastic option\ thanks to the fact that there are NO ATM fees charged by Charles Schwab and ALL ATM fees are reimbursed by the bank at the end of the month if they are charged to a bank client’s account. You can use a Charles Schwab ATM card anywhere in the world and you will not have to pay a fee.
However, you don’t only need to worry about fees on ATM withdrawals from your bank account when traveling abroad. As a traveler, you can also potentially be plagued by credit card transaction fees. This type of fee could be as much as 3% of the purchase amount. Just like ATM fees, this transaction fee can really add up over time. Yet there are some credit cards that will not charge you transaction fees when you’re abroad, and you need to look into this when you are initially signing up for a card.
Dealing with Exchange Rates
In addition to credit card and ATM fees, you should also be aware of the fact that your bank must factor an exchange rate into calculating your credit card bill or determining how much money should be coming out of your account in your home currency when you withdraw money in a foreign currency. Because your bank or credit card company has to do a conversion, they will be likely to charge a fee for the service.
Credit cards tend to be better at keeping any exchange rate penalties down. After credit cards, the best exchange rates are typically offered by ATMs. Withdrawing money from an ATM offered at a well known, reputable bank is the best way to enjoy a good exchange rate. Try to avoid ATMs located in places other banks, such as at convenience stores and hotels. Above all, you should avoid exchanging money at airport booths and other locations that are notorious for applying high margins to the amount you pay in the currency that you are changing.