12 travel money mistakes to avoid on your next vacation

Travel money mistakes to avoid

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Most seasoned travelers have probably made some of these slip-ups at one time or another, but you don’t have to make the same mistakes. Here are some common money mistakes to watch out for on your next trip to help you make the most of your hard earned money.

1. Only preparing one travel money option

  • The problem with this is… putting all your eggs in one basket can be disastrous if that basket gets stolen or misplaced. We’ve all heard the tale of how John Smith brought a bag full of cash on his holiday and was mugged. Also, you may find that your one travel money option might not be accepted in your destination country, but more on that later.
  • It’s probably better to… diversify for the sake of safety. Carry cash in small denominations for everyday expenses, take a prepaid travel card for meals and shopping, and bring a credit card for larger purchases and emergencies.

2. Using a travel card that doesn’t support the local currency

  • The problem with this is… you could end up stranded in Mozambique and not have access to the metical (Mozambique currency) despite having loading your travel cards with all of your funds.
  • It’s probably better to… ensure that your travel card supports your destination currency and lock in the exchange rate by loading that specific currency on your card before you go. If no travel cards support that currency, you should bring a credit card or debit card with no currency conversion fees.

3. Exchanging money with street vendors

  • The problem with this is… street vendors aren’t really known for integrity, consistency or for being money exchange connoisseurs. They could be looking to make a few extra dollars off of a tourist who doesn’t know any better.
  • It’s probably better to… get your currency exchanged with a reliable source like the bank. That said, you can sometimes get more favorable rates at an independent vendor. Shop around and compare foreign exchange rates.

4. Exchanging money at the airport

  • The problem with this is… airport exchange rates are usually terrible, not to mention the high fees that some money changers charge for the exchange.
  • It’s probably better to… do your currency exchange in advance. Otherwise, you’d be better off exchanging money with a reputable bank or using and ATM once you’ve reached your destination.

5. Carrying all of your travel money cards at once

  • The problem with this is… similar to putting all your eggs in one basket. What do you do if your wallet goes missing or gets stolen? Even if you do all the research on how to best spend your money, if it’s stolen you’ll be left with nothing.
  • It’s probably better to… pack one card in your wallet, one in your carry-on and your credit card in your checked-in baggage or safe in the hotel. You should also carry some cash as well as leave some in your hotel or luggage for safe keeping.

6. Waiting until your balance is empty to reload your travel card

  • The problem with this is… it might take some time for the online transaction to be processed and you might run out of money before the cash gets credited to your travel card.
  • It’s probably better to… reload in advance. Check your balance often to make sure you’re not running out of money. Also be aware that some card providers charge fees for reloading, in which case you should reload a large amount in one go instead of many small amounts.

Compare travel credit cards

Updated October 14th, 2019
Name Product Foreign transaction fee Welcome offer Rewards Filter values
None
75,000 points after spending $1,000 in the first 3 months
7x points on Hilton Honors purchases, 5x at US restaurants, US supermarkets and US gas stations, 3x on all other purchases
Earn 75,000 Hilton Honors Bonus Points after you spend $1,000 in purchases on the card within your first 3 months of card membership. Rates & fees
None
20,000 miles after spending $1,000 in the first 3 months
1.25x miles on all purchases and 10x miles at hotels.com/venture
Earn 20,000 bonus miles once you spend $1,000 on purchases within the first 3 months from account opening.
None
N/A
1x points on all purchases with 2% point value when you redeem for airfare and 1.5% for cash back
Receive an annual $100 air travel credit toward flight-related purchases including airline tickets, baggage fees, upgrades and more.
None
60,000 miles after spending $2,000 in the first 3 months, plus $50 when you make a Delta purchase in the same timeframe
2x miles on Delta purchases and 1x miles on all other purchases
Earn 60,000 miles after spending $2,000 in the first 3 months, plus $50 when you make a direct Delta purchase in the same timeframe. Rates & fees
None
75,000 miles and 5,000 MQMs after spending $3,000 in the first 3 months plus $100 when you make a Delta purchase in the same timeframe
2x miles on Delta purchases and 1x miles for all other purchases
Earn 75,000 miles and 5,000 MQMs after spending $3,000 in the first 3 months plus $100 when you make a Delta purchase in the same timeframe. Rates & fees

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    7. Writing your travel card PIN down

    • The problem with this is… the person who stole your wallet with your card in it may also have found that piece of paper tucked inside that has your PIN.
    • It’s probably better to… memorize your PIN and discard any written trace of it. Make your PIN a code that you can easily remember, but isn’t too obvious (like your birthday) .

    Monitor your account activity

    A good practice is to check your list of transactions regularly when keeping tabs on your account balance, just to make sure you haven’t been defrauded. If you have, make sure to contact your bank as soon as possible.

    8. Withdrawing cash frequently via ATM and debit cards

    • The problem with this is… most banks charge a transaction fee for every withdrawal made. If you’re using a debit card, this can be a flat fee or a percentage of the withdrawal amount – and it’s separate to the currency conversion fee. Sometimes, there is even an international ATM fee. If you’re using a prepaid card, different fees apply depending on the currency you’re withdrawing. If you’re using a credit card, expect high cash advance fees, currency conversion fees and interest rates to accrue from the day you make that withdrawal.
    • It’s probably better to… make a single large withdrawal from the ATM instead of many small withdrawals. Also, do your research and be aware of which fees apply to your specific card.

    9. Using your regular credit card or debit card

    • The problem with this is… foreign transaction fees can amount to a very expensive vacation. Some cards charge an average 3%-4% fee on each transaction, which means a $300 dinner can cost an additional $12 or so. Some credit cards don’t charge foreign exchange fees, but their interest rates will be substantial if you forget to pay your monthly balance.
    • It’s probably better to… use a travel card that you can preload a foreign currency to and transfer more cash electronically if you need. If you’d still prefer to use a credit card, look for one that’s designed for overseas use and doesn’t charge currency conversion fees. Otherwise, consider using a prepaid travel card for everyday purchases and leaving your credit card for emergencies.

    10. Not informing your credit card issuer that you’re going away

    • The problem with this is… some banks are so vigilant about preventing fraud that they may freeze your account once they spot unusual foreign activity.
    • It’s probably better to… call your bank before you go and let them know your travel dates and destination.

    11. Making credit card purchases in your home currency

    • The problem with this is… dynamic currency conversion – when you’re given the option of using your credit card to pay in your home currency or in the foreign currency of your destination. Retailer’s exchange rates are often less favorable than your card provider’s. On top of that, your credit card company still charges a 1% to 3% foreign transaction fee..
    • It’s definitely better to… pay in the local currency at your credit card company’s exchange rate. It’s the cheaper option.

    12. Carrying traveler’s checks

    • The problem with this is… there are multiple potential problems. Firstly, they can be lost or stolen. Secondly, they are costly and troublesome to obtain. Thirdly, and most importantly, these are no longer accepted in many places and you will find yourself limited to the few establishments that still accept them.
    • It’s probably better to… get with the times and forget about traveler’s checks altogether.

    Traveling always comes with a sense of risk, but your finances are something you never want to leave to fate. The key is to research your options, call your bank, ask for and compare rates before making your decision.

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