On a family vacation to the Caribbean, I lost my wallet on a bus. Inside was $400 in cash and two credit cards. While my husband tried to track down the bus, I kicked myself for being so careless. Then, I locked access to both cards in my app and tried to accept that I would never see the cash again.
Credit cards are generally more secure than cash, but they have some downsides, too. Even after this experience, I’d still recommend traveling with a little cash in addition to credit cards. Paying for my family’s checked bags could only be done with a credit card, but taxis on the island were cash-only. Here are some pluses and minuses of each form of payment.
Security: Carrying a wad of cash is rarely a good idea, especially when you're away from home and distracted to the max. If your wallet is lost or stolen, any cash is probably gone forever. If you lose your credit card, you can cancel it online or through the app and get a replacement expedited to you. You won't be held liable for unauthorized charges, either.
Acceptance: Plenty of places accept only credit cards. Cashless transactions can be faster than exchanging bills and coins. They also eliminate the need for merchants to store huge sums of money, which protects them from theft. It’s becoming more difficult to pay with cash en route to your destination, too. Certain airlines have gone entirely cashless for any in-flight transactions.
Bookings: Don't expect to be able to easily rent a car or check into a hotel room without a credit card. Even if it's possible, you'll be required to jump through hoops.
Rewards: You'll earn cash back, points or miles on purchases made with a rewards credit card and potentially even more with a travel card such as a co-branded hotel or airline card.
Budgeting: Some people find it easier to stay on budget when they pay with cash. No math required — when the cash is gone, you've hit your limit. If your spending discipline breaks down when you use credit cards, cash may be a better choice while you let loose on vacation.
No foreign transaction fees: Many credit cards charge an extra fee of up to 3% on purchases made outside the country, although you can find cards that don't.
No extra fees: Businesses pay interchange fees to banks for processing credit card payments, which eats into their profits. They may pass that surcharge onto consumers in order to recoup that fee, making cash the cheaper payment option in some cases.
Acceptance: That family-owned shop or street vendor may not be equipped to accept credit cards. For those occasions, you’ll need some cash.
Gratuity: Tipping those who serve you while on vacation, from the bellhop to the housekeeping staff, is easier with cash. And if you stay at an all-inclusive resort, you won’t have to pay for food and drinks, so it’s impossible to add a tip to the cost of the bill. Only cash will do in these situations.
Credit cards are generally the recommended choice of payment method to use when traveling. First, credit cards offer convenience and unparalleled security.
Also, take some cash with you, having compared prices online.Or consider putting most of your cash on a prepaid card for the extra protection. Finally, take your normal credit or debit card with you as a back-up for emergencies and ensure your travel insurance covers you for loss or theft of personal money.
There are no additional charges when you pay with cash. If you don't pay off a credit card purchase within 30 days, you'll likely pay interest (a monthly percentage charged on the amount you borrow from a creditor). Steering clear of interest by paying with cash can help you save money.
Fortunately, there are ways to financially prepare for future vacations and cut the cost of travel by strategically choosing your payment methods, travel dates and more.
There's a lot that you can buy with a credit card in Europe, so bring at least one. But don't expect to get very far without a little cash, too—especially if you're a tourist. Transportation services, such as taxis and buses, often require local currency.
First, credit cards offer convenience and unparalleled security. When making payments in a foreign country to vendors you've never encountered, the fraud protection on credit cards and the ability to dispute unauthorized charges make this payment method desirable and super-safe.
While debit cards and cash offer consumers limited benefits, using a credit card can help protect you against purchases that go awry. A credit card is guarded from fraudulent activity and some offer benefits like travel insurance and return protection.
Like most things in life, paying cash is the simplest route. It means you'll avoid paying interest charges. Setting up a travel savings account is an ideal method for socking away money. Once your savings account is established, keep that money separate from your other accounts and don't dip into it for anything else.
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If you're travelling internationally, it's best to bring a no-foreign-transaction-fee credit card so you don't waste funds just because you're shopping in another currency. In the end, you may find it's best to have access to both cash and a travel-friendly credit card when travelling.
At first glance, you might think that cash would be very secure. However, this is the least secure way of traveling with currency. While it might be a good idea to carry some cash, carrying large amounts of cash is never a good idea.
Points are meant to help you save on travel purchases, so using them for anything else is generally a losing proposition. If you want to redeem your rewards for non-travel purchases, you might be better off with a cash-back card like the Chase Freedom Unlimited® or Citi Double Cash® Card.
In some destinations, cash may be the only accepted method of payment at markets, restaurants, and small hotels. You can use your cash anywhere, and know that you'll have a sure-fire method of paying your way if you get stuck.
Before your trip, it's best to do a currency exchange at your bank or credit union, which likely offers better rates and fewer and/or lower fees. Your bank or credit union may buy back leftover foreign currency in exchange for dollars when you return.
Introduction: My name is Greg Kuvalis, I am a witty, spotless, beautiful, charming, delightful, thankful, beautiful person who loves writing and wants to share my knowledge and understanding with you.
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