Safe travels with your money
Considering a vacation soon? In the rush of preparing for travel, it is easy to forget the steps you should take to protect your finances while you are away. Here are some ways to avoid money-related travel issues, save money on fees, and greatly improve your chances for a safe, pleasant journey.
Decide on the amount of cash or credit you may need on the trip
For your own security, it is not a good idea to take large sums of cash anywhere. If lost or stolen, you cannot replace it. Only carry enough cash for local transit, tips, and other small expenses. Use credit cards when you can, because they are readily accepted by merchants worldwide and can easily be replaced if lost or stolen. If you need cash fast, even in a foreign country, you can usually get it from an automated teller machine (ATM) using most of the same cards you use back home. Before you travel, ask your bank about any fees, such as an ATM or foreign transaction fees, they may charge for using your debit or credit card at your destination. Read more about Overdraft and Account Fees here. Some suggestions to consider:
- If you plan to get cash using a credit card at an ATM, you can incur hefty fees. Using your debit card to get cash from an ATM may cost you less.
- If you’re traveling out of the country, when you pay for purchases, you are likely to fare better on the exchange rate (how much your U.S. dollars will be worth in a foreign country) if you use a credit card or a debit card (and choose the “credit” option) instead of converting your cash to local currency.
- If you do convert currency, the fee is usually the same whether you exchange $10 or $100, so convert larger, rather than smaller, amounts.
- Always exchange money in a safe place and put it away in your wallet or purse immediately. Divide and store your cash in multiple safe locations when you can. This can reduce the likelihood of losing all your cash in the event of theft.
- In addition to your bank (debit/ATM) card, take at least two major credit cards with available credit that should meet your foreseeable needs. If you are traveling internationally, make sure the cards you bring are widely accepted where you are going. Some cards are more widely accepted internationally than others. Leave unnecessary credit cards secured at home.
- If your card does not have foreign transaction and/or currency conversion fees when making purchases or taking money out of an ATM, choose the local currency during the process. Let your financial institution do the currency exchange, which will be more in your favor than if you convert the currency at the time of checkout.
Stash your valuables
Before leaving, consider putting jewelry and other valuable items in a safe deposit box at your financial institution. Other options may include a secured safe in your home or trusted relative or friends.
Copy important documents and make a list of important numbers
Make two copies of your passport identification page, driver’s license, vehicle registration, airline, or other tickets, and your itinerary. Leave one copy at home with a relative or friend, and carry the other one with you separately from the items themselves. Do the same with your list of important numbers, which might include phone numbers for your credit cards, bank, property insurance, and health insurance companies.
It is not a good idea to include credit card numbers or your Social Security number on this list, because the information could fall into the wrong hands, and be sure to carry the list with you; do not pack it.
Understand what credit card blocking is about
Credit card blocking most often occurs when you rent a car or check into a hotel and present your credit card. The clerk can electronically ask the bank that issued the card to “block” (reserve) part of your line of credit to cover the expected cost before you use it for other vacation purchases. If it is a hotel, what is usually blocked on arrival is the cost of your room for the length of stay, plus incidental expenses you may incur, like meals and phone calls. In the case of rental cars, it could be the cost of the rental plus fuel charges. There is nothing sinister or illegal about it, as long as the amount blocked is not out of line with what the customer is likely to pay at the end of the transaction.
If you leave on vacation with your credit card near the limit or if you are a business traveler who spends long periods on the road, you should be aware of credit blocking. Any additional transactions you attempt after you hit your credit limit could be rejected.
To learn more about credit card blocking, visit the Federal Trade Commission (FTC) webpage, When a Company Declines Your Credit or Debit Card.
Pay bills before you leave, if possible
You do not want essential services to be cut off while you are away on a long trip. Check the due dates on all bills, especially utilities and auto insurance, to see if payments will come due in your absence. If so, make those payments before you leave or pay them online from wherever you are (set a reminder and be mindful of time differences). Placing bills on auto pay may be an option too.
An upcoming trip is also a good reason to consider signing up for direct deposit, if you have not already done so. With direct deposit, you do not have to worry about possible theft of the checks by mail and you know the funds will be in your account on a certain date, a comforting thought whether you are away or at home.
Protect yourself from thieves and scammers who target travelers
Here are some precautions:
- Do not flaunt your cash, charge cards, fancy clothes or expensive jewelry (even expensive-looking jewelry). Robbers or thieves could be among the people you may be impressing. Avoid pickpockets by making sure your bag or purse is closed, and try to have it in front of you in your view whenever possible.
- Call your credit card companies to place a travel alert, so they know you will be out of town and can expect to see certain charges.
- Always take your credit and debit/ATM card receipts with you, and never give anyone your personal identification number (PIN). All contain information about your account that a thief can use to get cash or make purchases. If your cards are lost or stolen in the U.S. or abroad, immediately report this to your bank or card issuer. In general, federal law limits your liability for unauthorized charges on a credit or debit card if your card is lost or stolen, but you must notify the bank or card issuer within certain timeframes.
- At hotels, keeping your extra cash, jewelry, passport and other valuables in the hotel safe might add an additional level of security compared to leaving it out. However, some hotel safes may have a master key or a special override code to open the door. When a hotel safe has a way for someone other than you to get in, your stored items are not completely safe. Make sure you remember to take the valuables out of the safe when you leave.
- While you may not enjoy hanging out at airports, thieves do. They know airports are full of tired, hurried, or confused travelers carrying cash, credit cards and other valuables. This kind of theft usually occurs near ticket counters, X-ray machines, baggage check and claim areas, rest rooms or vending areas. The basic advice: stay alert.
Banks, card companies, express delivery services and other businesses are there to help
If the unexpected occurs, there are many ways to get emergency cash or arrange for payments practically anywhere in the world. A nearby bank can arrange for a cash advance using a major credit card; however, it is important to understand the fees and interest charges associated with the transaction. You also can ask the bank to have money transferred electronically from your bank or brokerage account back home. Alternatively, see if the bank can safely deliver traveler’s checks and money orders or wire funds to your hotel or other location. If your wallet is lost or stolen, call your bank or credit card issuers immediately to report any lost or stolen cards.
Keeping these tips in mind will help you avoid money-related issues during travel, save on fees, and reduce your stress, so you can enjoy a pleasant journey.
Additional resources:
FDIC, Credit Card Checks and Cash Advances
FTC, When a Company Declines Your Credit or Debit Card
FTC, Timeshares, Vacation Clubs, and Related Scams
FTC, Rental Listing Scams
For more consumer resources, visit FDIC.gov, or go to the FDIC Knowledge Center. You can also call the FDIC toll-free at 1-877-ASK-FDIC (1-877-275-3342). Please send your story ideas or comments to ConsumerEducation@fdic.gov. You can subscribe to this and other free FDIC publications to keep informed!