Best ways to spend travel money in the USA: Debit & prepaid cards

The United States of America is a society of credit. If you’re travelling to the States, you can use your Visa, Mastercard and American Express cards everywhere. Banks are common and ATMs are inside most corner stores as well.

What is the best way to take and spend money in the USA?

You’ll find most Americans rely on their credit card or debit card to make purchases as much as cash. There are times when you’ll need to pay cash. For example paying for a drink at a small bar or buying a hotdog from a food truck might require cash. However, you will see that most merchants in American cities are set up with the infrastructure for card, contactless and mobile payments. Visa, Mastercard, American Express and Diners Club cards are widely accepted.

Travel money options for the United States

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Can I use a UK debit card in the USA?

You can use any Mastercard or Visa branded debit card in the United States, though you should be weary of using it abroad as there may be fees attached. Barclays will charge a 2.75% non-sterling transaction fee, Lloyd’s will charge a 2.99% non-sterling fee on cash withdrawals and purchases, and NatWest/RBS will charge a fee of 3% (minimum £3). In the case that you find yourself needing to use a debit card abroad, it’s worth checking if your bank is part of the Global Alliance, a group of banks with an agreement to give customers a cheaper way to withdraw money abroad.

Using prepaid travel cards

All UK travel money card issuers allow you to load and spend in United States Dollars. The main advantage of these cards is you can lock in an exchange rate when you convert GBP to USD and spend without paying the extra 3% for currency conversion. Although Visa, Mastercard and American Express are accepted everywhere (if the merchant can accept a credit card they can also accept a travel card), not all of them have your name printed on the front, which may cause the merchant to reject them. These instances may be limited to smaller shops. Compare these cards by the fees. For example, some travel cards waive the international ATM withdrawal fee. The local ATM fee is unavoidable unless your travel money provider has a pre-arranged deal with a US bank. There’s also the initial load fee, the reload fee and inactivity fees to think about too.

Using credit cards

The US is a society of credit, and credit cards, there are no issues with Visa, Mastercard, American Express and Diners Club card acceptance. Contactless payment terminals are common at places like Walmart, Target, Kmart and other major retailers. The currency conversion fee is the main charge to avoid when you’re looking at travel friendly credit cards. The international ATM fee is the other main fee; however, due to the extra charges which come with a cash advance, you should avoid using your credit card to make cash withdrawals. Depending on your card provider, you can avoid some cash advance fees by loading your credit card with your own money (keeping a positive balance), but you forego anti-fraud guarantees when you spend your own money on your credit card.

Credit cards in the US

Using traveller’s cheques

Traveller’s cheques were once a staple for any overseas trip. In recent times, card acceptance and security have made these travel money products a burden.

Reviews of popular accounts that you can use in the USA

Starling Bank - Current Account - Age 18 and over

Finder rating

★★★★★

Customer rating

★★★★★

Go to site Read review

£0

Min. opening balance

£0

Account fees

0.05% AER

Interest (AER)

• Account info
• Pros/cons
• Details

No fees overseas.

With the Starling Bank debit card, you can make payments and withdraw cash wherever you are in the world, including the USA, without being charged a fee for doing so. Starling Bank passes on Mastercard’s real exchange rate, with no additional charges, so you’ll get more for your money. You’ll get instant alerts on the app whenever you spend, in both USD and GBP, so you’ll know exactly what you’ve spent. Plus, should you lose your card while you’re away, you can simply lock it on the app or order a new one to be sent out to you, wherever you are.

Representative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 15% EAR variable .

• Free ATM withdrawals and spending anywhere abroad
• Can deposit both cash and cheques for free
• Spending insights and saving tools
• 'Settle up' feature to split joint bills
• Pays interest on current account balance
• Overdrafts and loans available

• Lower ATM withdrawal limit than some other digital challengers
• No group savings feature
• Doesn't have a specific monthly budgeting tool
• No rewards program

Interest rate	0.05% AER
Minimum opening balance	£0
Minimum operating balance	£0.01
Switch service guarantee	Yes
Account fee	£0
Overseas card transactions	£0
Overseas cash withdrawals	£0

Revolut - Revolut Metal

Finder rating

★★★★★

Customer rating

★★★★★

Go to site Read review

£0

Min. opening balance

£12.99 per month

Account fees

0% AER

Interest (AER)

• Account info
• Pros/cons
• Details

Get 3 months of Premium for free. For new customers only, T&Cs apply.

There’s a whole host of travel benefits with the Revolut Metal account which costs £12.99 a month. You can spend on the card globally fee-free on weekdays at the interbank exchange rate (you’ll be charged a mark-up on weekends), and you can withdraw up to £800 each month fee-free. All purchases are protected up to £10,000 for a year, you can get 10% instant cashback on selected accommodation and you can take advantage of delayed flights and baggage insurance, plus worldwide emergency medical and dental cover. You’ll also earn up to 1.2% cashback on card spending in any of Revolut’s 30+ supported currencies.

• Fee-free withdrawals abroad
• Purchase protection
• Discounts on holiday accommodation
• Travel insurance and airport lounge access

• Monthly fee applies
• No overdraft available
• App-based account

Interest rate	0% AER
Minimum opening balance	£0
Account fee	£12.99 per month
Overseas card transactions	0% Mon-Fri
Overseas cash withdrawals	0% Mon-Fri

Chase - Chase Current Account - Current Account

Finder rating

★★★★★

Go to site Read review

£0

Min. opening balance

£0

Account fees

0% AER

Interest (AER)

• Account info
• Pros/cons
• Details

Receive 1% cashback on everyday purchases for 12 months from account opening.

Open the Chase bank account and you’ll benefit from fee-free spending and cash withdrawals on your debit card abroad. Although some ATM providers charge a fee, if you’re travelling to the USA, you can make free withdrawals at any Chase Bank ATM (maximum limit of £1,500 a month). Chase uses Mastercard’s exchange rate with no additional fees or mark-ups on your spending. As well as earning 1% cashback on all your debit card purchases at home, you’ll also earn 1% cashback when you book flights using your debit card and 1% cashback on your spending while you’re away too (in the first 12 months).

• No monthly account charge
• No fees for spending or making cash withdrawals abroad
• 1% cashback on a wide range of purchases
• 5% interest on savings generated by the “round ups” feature
• 1.5% interest on balances in the linked Chase saver account
• 24/7 in-app customer support

• 1% cashback and 5% interest offers only run for 12 months
• No branches if you prefer face-to-face banking
• Can’t deposit cash or cheques into the account
• Overdrafts not available yet

Interest rate	0% AER
Minimum opening balance	£0
Minimum operating balance	£0
Switch service guarantee	No
Account fee	£0
Overseas card transactions	0%
Overseas cash withdrawals	0%

Virgin Money - Virgin Money Current Account - Age 18 and over

Finder rating

★★★★★

Customer rating

★★★★★

Read review

£0.01

Min. opening balance

£0

Account fees

2.02% AER

Interest (AER)

• Account info
• Pros/cons
• Details

Comes with linked M Plus Saver Account and access to exclusive ISA products.

The Virgin Money M Plus current account comes with a Mastercard debit card that can be used globally, wherever Mastercard is accepted. What’s more, you won’t be charged for spending on your card or making cash withdrawals wherever you are in the world, including the USA. The Virgin Money app will help you track what you’re spending where and help you budget, plus you can use it to report your card as lost or stolen and order a new one. The account also pays interest on your balance and you can earn cashback at selected retailers.

Representative example: If you use an arranged overdraft of £1,200 you'll be charged interest at 19.9% EAR variable .

• No monthly fee
• Pays interest on in-credit balances
• Fee-free foreign transactions
• Easy to apply for and manage account online or via the ap

• High interest charged on overdrafts
• Interest only payable on small balances
• You’ll need a good credit score to apply

Interest rate	2.02% AER
Minimum opening balance	£0.01
Minimum operating balance	£0.01
Switch service guarantee	Yes
Account fee	£0
Overseas card transactions	£0
Overseas cash withdrawals	£0

How much sterling do I need to bring to the US?

There’s an old saying first coined in the Reader’s Digest, once you’re finished packing your suitcase, take out half the clothes and take double the money. Ultimately, how you take your money is up to you. Someone couch-surfing in San Francisco will have a different budget to someone on a New York shopping holiday.

New York service	Budget	Mid	Top
Accommodation	Hostel: $30 – $60 per night	Hotel / Motel: $150 per night	5 star hotel / Superior suite: $350 per night
Food	Food truck: $5 – $10	Restaurant: $20 – $40	5-star restaurant: $50 a plate
Entertainment	Free festivals year round in American cities	Guggenheim Museum: $25	Broadway Musical: $200 – $300

_{*Prices are approximate and subject to change}

• Travel money options for USA at a glance

  Travel money option	Pros	Cons
  Debit cards for travel	No currency conversion, international ATM, account keeping fees Assistance in opening an account if you’re travelling through the US for an extended period	There can be fees attached to using a debit card – make sure to check the small print!
  Prepaid travel money cards	Locked-in exchange rates No currency conversion fee International ATM withdrawal fee waiver on some cards	Fees to consider such as local ATM, initial load, reload and inactivity fees
  Credit cards for travel	Accepted everywhere – contactless payment terminals are common Dedicated cards can help you dodge currency conversion fees	If you repay over a long time, this is an expensive option
  Traveller’s cheques	Acceptance Security	Can be costly with initial purchase charges Not all merchants accept traveller’s cheques
  Cash	Greater payment flexibility Convenience	More difficult to manage expenses Higher risk of theft

  _{This table is a general summary of the travel money products in the market. Features and benefits can vary between cards.}

• Paying with cash in the USA and tipping etiquette

  Dollar bills can give you the impression your wallet is fatter than it actually is. And although you can get by using your card for most purchases, there are times when you’re going to need cash. The USA has a culture of tipping, it’s a substitute for low wages. You’ll need cash to tip, especially if you’re at a bar, restaurant, club or hotel.

  Where?	How much should I tip?
  At a restaurant	Waiters should get anywhere between 10% – 20% of you bill. Some restaurants will add tips onto the final bill (more common in tourist areas), if this is the case, you don’t need to leave a tip.
  At a bar	Drinks are pretty cheap. It’s good form to tip $1 per drink. You may even get a free one from the bartender if you tip a $5.
  At the hotel	Tip the porter $2 – $5 for a big bag and an extra $1 for every other bag. Tip housekeepers anywhere from $5 – $10 a day.
  Taxis	10% – 20% of the fare
  Cafe	The barista making your coffee doesn’t necessarily need a tip unless he or she has done something special.

Buying currency in the UK

If you’d like to have American dollars when you arrive, you have a number of choices for getting cash changed in the UK. Look at your bank and look at foreign exchange providers such as Travelex or No1 Currency.

• Tip: Make sure you’ve applied for your United States ESTA (Electronic System for Travel Authorisation) before you leave for the USA. This will cost you $14 and you can pay by a Visa, Mastercard, American Express, Diners or Discover credit card.

Why you’ll need a combination of travel money options

Use a combination of travel money products which don’t charge for currency conversion and have low or no international ATM withdrawal fees. A travel card or debit card used in conjunction with a travel-friendly credit card will give you a cost-effective way to make both over the counter purchases and ATM withdrawals in the USA.

It’s important to have more than one way to access your money when you’re abroad. Travel to the United States is exciting, don’t make it stressful by limiting your options. By doing a little research before you go, you can save on fees which can easily add up to the cost of a night out or souvenir for a loved one.

You’ll find card payments are the norm in the USA, the currency conversion fee may not seem like much, but giving almost £10 for every $300 you spend or withdraw to your bank isn’t just unnecessary, it’s criminal. Compare travel money options and apply for a card you can use to spend for less in America to avoid throwing money at your bank while you’re visiting the United States of America.