When economic times are tough, it is hard to scrape together enough nickels to explore beyond your own backyard. Some manage to do it. Those who do it right know that the key is preparing your travel funds.

Don’t be surprised when your Amex doesn’t fly in Argentina and your ATM card flops in Hong Kong. So here are some tips.

Credit Cards

Foreign Transaction Fees: Take the time to look up these fees on your credit cards. Most credit cards add 1 – 3 percent for every overseas purchase. Visa and Mastercard, for example, charge 1 percent. NerdWallet.com lists all of the credit cards that don’t charge a foreign transaction fee. If you don’t have one of those cards, consider opening a new account that doesn’t include an annual fee to avoid overseas surcharges.

Microchip: Many countries now use credit cards with a smart chip, rather than cards with magnetic strips. The new FlexPerks Visa card from U.S. Bank has a chip and a magnetic strip. This is handy for international travel in Asia and parts of Europe. Some subways and train stations abroad have machines that only accept smart chip cards. The annual fee is $49. There are some other cards that offer a smart chip, but their annual fees are around $100.

Travel Insurance:  Some credit card companies offer their members baggage loss, international medical assistance, and accidental death and dismemberment insurance. Since 9/11 there are policies that include an "Acts of Terrorism" clause to reimburse you if you miss or are delayed getting to your destination for that reason. Companies that offer such deals are: American Express Gold, Discover Escape, Citi Thank you Premier, and Chase Sapphire. Find more choices at dailymarkets.com. Heads up! These cards carry an annual fee.

Avoid Theft

Divide: Before you leave the hotel/hostel/flophouse/B&B/rental, divide your money up into different pockets and bags. Also make sure your IDs and credit cards are tucked away. Men, do not carry your wallet in your back pocket. You can get an under-the-shirt pouch or a special money-belt to hide your money. Magellan's has great discreet products for securing your valuables and your identity. These special products are imbedded with RFID (radio frequency identification) blockers, which prevent thieves from stealing your identity with their high-tech devices. You can also find these products for a deal on Amazon.com. If you look like a tourist, you could be targeted.

Protect: Losing your credit cards, cash, and/or passport can turn a dream vacation into a nightmare. When my family traveled to France, my brother was pickpocketed and lost all of these things. It put a halt to our trip and put us at the mercy of translators at the U.S. Embassy. Be prepared in case something like this happens to you. Keep one credit card locked away in your luggage as a backup. It is also wise to make two photocopies of your passport–-one for your suitcase and one for a family member or friend back home. This way if you lose the original, it makes it easier to contact authorities, banks and credit card issuers for replacements. My family had a photocopy of my brother's passport, which allowed him to get a temporary passport much quicker.


Exchange Rate: Visit a website like xe.com before your trip to find out what kind of currency you’ll need and the local exchange rate. Depending on the rate, it may be to your advantage to go ahead and get the foreign change before you leave for the airport. The inflated conversions and international fees once you land can be quite hefty. When my family traveled to Italy, we regretted not getting money ahead of time, since we later found out it was a better deal in the United States. Some banks will require a few days to receive your new currency for travel so make these plans in advance. Banks can also waive fees for their customers. Something you probably won't find abroad.

Inform Your Bank/Credit Card Companies: Many companies will freeze your account if foreign transactions show up and you haven’t provided notice you are traveling. Use the wait time at the airport to call your bank and credit card providers and inform them of your destination and travel dates.

This has been a guest post by Amanda from Greensboro, NC
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Credit, Cash and Currency Tips for Travel Abroad