Yahoo Finance $8 a pop: The expensive travel mistake you're making
Aussies taking advantage of open borders to do some long-awaited travel have been warned that using their normal bank cards could attract steep international charges.
For a $100 purchase or ATM withdrawal, you could be whacked with charges above $8 just by using the normal bank cards in your wallet.
Not all banks charge massive fees for transactions while you’re abroad.
The highest you could be charged for a $100 ATM withdrawal with a credit card was $8.40, according to Canstar research, and the lowest fee was $2.50 for a transaction of this size.
Debit cards were much the same - with the steepest fee $8 for a $100 ATM withdrawal - although some cards charge no fees for ATM withdrawals or at the point of sale.
“Not all credit and debit cards are specifically designed for travel, which can make travelling with the card already in your wallet a costly mistake,” Canstar finance expert Steve Mickenbecker said.
“When travelling, you will be transacting in an overseas currency and will see a currency-conversion fee in your statement that you wouldn’t see when transacting at home.
“That will avoid the unpleasant surprise - when you return home - of finding that fees have bumped up the cost of your purchases by as much as $7 or $8 per $100.”
Mickenbecker recommended only taking your usual credit cards and debit cards along with you as emergency backups.
How to avoid fees
Travellers have a couple of options if they want to dodge overseas transaction fees.
Start by checking the policies for currency conversion on your existing cards, because some offer no or low fees for this service.
Failing that, you can get a specially designed travel money card. With these cards, you can upload already-converted foreign currency before you leave and take it with you.
The benefit of using a travel card is you can top it up when the exchange rate is looking favourable, which will help your Aussie dollars go further.
However, these travel cards also come with their own sets of terms and conditions.
According to Canstar, Revolut and Wise travel cards were good options because they offered low transaction fees and user-friendly digital platforms that allowed travellers to log in and manage their money easily.
Canstar offered some other tips to avoid excess transaction fees while travelling overseas:
Look for ATMs that are connected to your bank to avoid a local owners fee and paying your bank’s fee for using an ATM outside of their network
Choose to pay in the local currency as you are likely to secure a better exchange rate than the local retailer or bank will apply to your purchase
Plan ahead so you have access to a no- or low-fee card or take with you some cash in the currency of your destination. This will mean you are not faced with an unfavourable exchange rate at the airport and you could be charged a fee for your transaction.
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