How to get your money abroad – ATMs, cash or travelers checks? That´s a preety common question to be answered at the first time we are going to travel abroad. Some people are worried about safety, other travellers, about economy. And most of them are concerned about both issues.
Travellers checks ensure you a fixed exchange rate, so they make it easier to stick to your budget. The big drawback is that some places change them at a hefty exchange rate, or charge a comission. American Express website lists banks worldwide which change their checks free of charge, and so far they are a good option in major cities.
Some people are moving to the so-called travel money . It´s the modern cousin of traveller cheques – you fill it back home, and withdraw money at VISA ATMs, for example. Those cards can be blocked in case of stealth, as are the travellers checks.
And what the old-fashioned money belt filled with money? It’s inconvenient and unsafe. However, having some hard currency at hand is essencial for not getting stuck in some situations. Imagine a US$25 visa-on-arrival fee, an empty wallet, and you can get the whole picture. And don’t understimate the bureucratic skills of some organisations – once I needed US dollars to pay a fee to the Brazilian Embassy in Mozambique.
Bank card – Beware the tiny letters
Last but not least, the ATMs. You look for a Visa or Mastercard ATM machine, use your bank card, type a 6-digit PIN and withdraw money from your current account. They usually charge you a small ammount for every operation, and some extra fees.
There are two points to consider about that “extra”, though. First, your card operator converts the withdrawn ammount to US dollars, and if your account is outside the US, they will convert it again to take the money from your piggy safe. On my leave of absense in China, the RMB to USD, and USD to BRL conversions meant an average 3% loss compared to taking traveller cheques.
Last but not least, make sure your bank card abroad withdraws money from your current account, and doesn´t do it from your credit account. During my first trip abroad, in 2004, I was using my Visa and choosing the option “current account” from the ATMs. One day, the card stopped working, though there was some money in my current account. After a couple days I figured out my bank was taking the money from my credit account, anyway. That is, it would charge ridiculous interest rates. Even today, that happens with Bank of Brazil cards abroad. If you’re not sure how things will work, don’t leave all your eggs in one single basket.
The bottom line
Even though we lose a little money by using ATMs, even long term expats enjoy them. For a trip, probably the best strategy is to mix your sources. A possible scenario:
1. Some US dollars or euros, specially in case of a trip involving multiple countries. They´ll work for paying on-arrival visas, and can be exchanged easily for local currency before you find an ATM or can change traveller cheques;
2. If you’re going on a shorter trip, try using travel money instead of travellers checks.
3. On the other hand, longer trips can benefit of your bank card. As you hit the road, probably there´s a paycheck on the way, for example. I don’t thing paying US$3 for each withdrawal is a big deal compared to spending a whole morning looking for a decent exchange rate or being worried about a money belt with 1000 euros in it. Check at home if your card is enabled to be used abroad;
Anyway, make sure beforehand that you can find ATMs on the destination (Visa and Mastercard websites provide that information).
