Optimize Your Banking For International Travel

Optimize Your Finances For Foreign Travel

Whether on a vacation for a few weeks or staying for a few months or more for work, study, or mission work, it’s important to optimize your banking situation.  Your goal should be making your money (1) easily accessible in the country you’ll be visiting AND (2) minimizing any fees that banks and credit card companies may charge you (which really add up).

Money Tips for Vacation and Other Short Stays

I’ve done a bit of international travel lately and picked up a few tips for shorter stays:

Credit Cards – If you’re simply visiting a foreign country for a few days or weeks, taking the right travel rewards credit card will save you a great deal of headache and money.  I wrote an article back in January discussing the Best Credit Card for World Travelers, in which I discovered that the Capital One No Hassle Mile Rewards card was the best option because of it’s 0% foreign transaction fees, global acceptance (Visa/MasterCard), and rewards points.  Just make sure you pay off all your balance when you get home.

Debit Cards– Not a credit card user?  Use the Visa/MasterCard debit card from your local bank to make purchases.  Be careful though, as the foreign currency conversion fees can really add up.  Visa and MasterCard normally charge you 1% and then the banks put their charges on top of that.  The best of the best is the Capital One Checking Debit Card, which is at 0% (they pick up the Visa/MasterCard fee for you).  Here’s a quick list of debit cards and associated fees:

Foreign Currency Conversion Fee Percentage for DEBIT CARDS

Bank Debit CardFee
Capital One Debit Card0%
Commerce Bank Debit Card0%
Simmons Debit Card0%
HSBC Debit Card1%
Wachovia Debit Card1%
Washington Mutual Debit Card1%
Zions Debit Card1%
BB&T Debit Card2%
Citibank Debit Card2%
National City Debit Card2%
Royal Bank of Scotland Debit Card2%
PNC Debit Card2.5%
Bank of America Debit Card3%
Chase Debit Card3%
Fifth Third Bank Debit Card3%
Regions Debit Card3%
SunTrust Debit Card3%
US Bancorp Debot Card3%
Wells Fargo Debit Card3%

Source: Bankrate.com

I also checked out Capital One 360’s Checking Account, since it’s the Debit Card that I use and not listed above.  Their fee is at 2%.  Not good in comparison.

Cash – As for paper currency, try and do your conversion (to foreign currency) prior to leaving the US with your US bank or the institution that will give you the best rate with the lowest commission.  Shop around.  As a bonus, you’ll have local cash on hand when you hit the ground.  Still a while before you take your trip?  You might want to lock in your exchange rate before you travel.

Money Tips for Longer Trips

If you’re actually making a temporary move to a country overseas, you’ll need to consider more than just cards and cash.

Foreign Bank Account –  You may want to set up an account with a local branch in the foreign country.  Do a quick Google search for the “best bank in x country” or “US-friendly bank in x country.”  Having a local bank will give you somewhere to receive your salary and provide a means of paying for day to day things in the local currency.  Plus, it can’t hurt to have a local financial ally for any tricky scenarious that come up.

Keep in mind the account setup procedures may be more extensive with a foreign account, so be prepared with all the necessary documents (call ahead and find out what those are).

Lastly, only place just enough money in this account.  A vast majority of your funds should likely be keep back in your US bank where they are sure to have FDIC coverage and reside in a stable economy.

Tax Implications – If you are a US Citizen, income you earn in the foreign country is still taxed by the IRS.  Also, if you do open up a foreign account you’ll have to disclose it to the IRS via Form TD F 90-22.1.

Other Important Travel Money Tips

  • Call all your bank and credit card companies and inform them you’ll be traveling internationally and using your card in a foreign country.  They will temporarily remove any fraud alert holds they may have set on your accounts.
  • Get the “from outside the US” phone numbers for your bank and credit card company’s customer service (1-800 might not work where your at).
  • Check the expiration dates on all your cards.  If a card is set to expire while you’re on your trip, have them send you a new one early.
  • Make sure all your account PINs are set to four digits (more universally accepted).

Even More Resources

Disclaimer: While I’ve done some international traveling, I’m far from an expert on the subject.  Be sure and contact a professional for guidance on your unique situation.

Photo: by Phillie Casablanca

Do you have any other money and banking tips for the overseas traveler?  Share them in the comments below.

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About Philip Taylor, CPA

Philip Taylor, aka "PT", is a CPA, blogger, podcaster, husband, and father of three. PT is also the founder and CEO of the personal finance industry conference and trade show, FinCon. He created this website back in 2007 to share his advice on money, hold himself accountable (while paying off over $75k in debt), and to meet others passionate about moving toward financial independence. He uses Personal Capital to track his wealth. All the content on this blog is original and created or edited by PT.


  1. I’m glad it helped!

  2. Not A Niche says

    Hey PT,

    what a great post, just the one I need. It perfectly fits to my circumstances right now, since I’m overseas 🙂

    Thanks for the great information

  3. True, true.