No Foreign Transaction Fee Credit Card vs. ATM and Cash
No Foreign Transaction Fee Credit Card vs. ATM and Cash
Okay, now I'll show my lack of travel savvy ...
In the past, I've rarely used a credit card when traveling overseas. Rather, I take my debit card and periodically withdraw local currency from bank ATMs to cover local transit, accommodations and attractions. But not those found in 7-Eleven's, etc. which might have additional fees.
This year, I got a Capital One no foreign transaction fee credit card.
But then I got to thinking - is there any advantage to using the no foreign transaction fee credit card vs. ATM cash withdraws?
Yes, carrying around more cash in my money belt might be a higher risk if there is theft, but I've usually only withdrawn sufficient currency for a few days at a time. I figure the exchange rate on more frequent smaller withdraws should equal about the same as fewer larger ones.
So is there any advantage from a cost or other perspective for one or the other of these alternatives?
In the past, I've rarely used a credit card when traveling overseas. Rather, I take my debit card and periodically withdraw local currency from bank ATMs to cover local transit, accommodations and attractions. But not those found in 7-Eleven's, etc. which might have additional fees.
This year, I got a Capital One no foreign transaction fee credit card.
But then I got to thinking - is there any advantage to using the no foreign transaction fee credit card vs. ATM cash withdraws?
Yes, carrying around more cash in my money belt might be a higher risk if there is theft, but I've usually only withdrawn sufficient currency for a few days at a time. I figure the exchange rate on more frequent smaller withdraws should equal about the same as fewer larger ones.
So is there any advantage from a cost or other perspective for one or the other of these alternatives?
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
A lot of it depends on where you travel. I was just thinking back to my recent travels, and in 9 of the last 10 countries that I visited, credit cards were not accepted at most places so it was mostly irrelevant. I live in the Philippines and there is almost no opportunity to use credit cards in my day to day life (and when I could, like for a hotel stay, they are often more costly), and I get cash at 0% foreign transaction with no fees, so no big deal.
But I certainly always use credit cards for flights.
I think it is better to have both, 0% fee credit cards and 0% debit/ATM cards that allow you to get cash and that reimburse ATM fees.
But I certainly always use credit cards for flights.
I think it is better to have both, 0% fee credit cards and 0% debit/ATM cards that allow you to get cash and that reimburse ATM fees.
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I'm assuming that you're comparing..
(a) Point-of-sale transactions with a no-fee credit card (Capital One Visa),
(b) ATM withdrawals with a no-fee debit card (Schwab checking, which will reimburse you for any fees that the other bank might charge).
In both those cases, the exchange rate will be close to spot (determined by Visa/MC), and there will be no transaction fees.
Some minor issues to consider..
Downside of Credit Cards: If you're in a high crime, 3rd world country, there might be an increased chance your credit card info will be stolen/skimmed whenever it gets used. I've read that in those types of countries, you only want to use your credit card at the luxury hotels.
Downside of ATM Withdrawals: Some ATM machines may offer to do the currency exchange for you. This example is a British ATM card trying to withdraw money at an ATM machine in Spain.
The screen might be confusing, but make sure you decline the currency conversion. If you let the ATM machine do the currency conversion, forget about getting spot rate. The ATM machine might gouge you with a terrible exchange rate, like 5-6% premium over spot (even though the misleading ATM screen says 0% commission).
(a) Point-of-sale transactions with a no-fee credit card (Capital One Visa),
(b) ATM withdrawals with a no-fee debit card (Schwab checking, which will reimburse you for any fees that the other bank might charge).
In both those cases, the exchange rate will be close to spot (determined by Visa/MC), and there will be no transaction fees.
Some minor issues to consider..
Downside of Credit Cards: If you're in a high crime, 3rd world country, there might be an increased chance your credit card info will be stolen/skimmed whenever it gets used. I've read that in those types of countries, you only want to use your credit card at the luxury hotels.
Downside of ATM Withdrawals: Some ATM machines may offer to do the currency exchange for you. This example is a British ATM card trying to withdraw money at an ATM machine in Spain.
The screen might be confusing, but make sure you decline the currency conversion. If you let the ATM machine do the currency conversion, forget about getting spot rate. The ATM machine might gouge you with a terrible exchange rate, like 5-6% premium over spot (even though the misleading ATM screen says 0% commission).
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I've found both methods to apply similar, good exchange rates. Take an atm card that reimburses ATM fees and a no transaction fee credit card and you are set.
What you want to avoid doing is taking cash and exchanging it or using any form of exchange service where they give you bad rates.
What you want to avoid doing is taking cash and exchanging it or using any form of exchange service where they give you bad rates.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I don't use a debit / ATM card here at home in the states so I wouldn't even think about doing it when I'm overseas.
I use my Chase VISA everywhere in Western Europe without issue. I carry some (~150) euros in case I really need something from a vendor that won't take a CC.
I use my Chase VISA everywhere in Western Europe without issue. I carry some (~150) euros in case I really need something from a vendor that won't take a CC.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
And you get those 150 euros, where?WHL wrote:I don't use a debit / ATM card here at home in the states so I wouldn't even think about doing it when I'm overseas. ...I carry some (~150) euros in case I really need something from a vendor that won't take a CC.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Re: The screen might be confusing, but make sure you decline the currency conversion.
I'll say! Thank you for showing that screen shot. Even after reading the screen 5 times, I was still confused. But hitting NO it will be.
RE: Take an atm card that reimburses ATM fees
Yes, I'll now need to get one of these. I think my credit union only reimburses me up to $5. If so, then it looks like my no foreign transaction fee credit card will be the best way for me to go this time.
btw - Travel to Scandinavia
Thanks
I'll say! Thank you for showing that screen shot. Even after reading the screen 5 times, I was still confused. But hitting NO it will be.
RE: Take an atm card that reimburses ATM fees
Yes, I'll now need to get one of these. I think my credit union only reimburses me up to $5. If so, then it looks like my no foreign transaction fee credit card will be the best way for me to go this time.
btw - Travel to Scandinavia
Thanks
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
One should be getting cash-back or frequent flyer miles with the credit card. I don't think you will get that with ATM-cash.jdjd2 wrote:But then I got to thinking - is there any advantage to using the no foreign transaction fee credit card vs. ATM cash withdraws?
...
So is there any advantage from a cost or other perspective for one or the other of these alternatives?
One will get a list of places they spent their money with the credit card, i.e. a monthly statement. That may help with budgeting.
One will not be carrying cash around that could get lost or stolen.
One doesn't need to waste time going to an ATM every few days.
I've been overseas for the past week or so and have yet to use cash. Even my bus/train/taxi rides can be paid with a credit card. Even a $3 drink can be paid with a credit card. Of course, it all depends on where you are, so check with bogleheads for local customs.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
The basic rule is, everybody takes cash. Some places take credit cards.
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
The nice thing is with no fee ATM card, you can get your cash in smaller increments.jdjd2 wrote:RE: Take an atm card that reimburses ATM fees
Yes, I'll now need to get one of these. I think my credit union only reimburses me up to $5. If so, then it looks like my no foreign transaction fee credit card will be the best way for me to go this time.
btw - Travel to Scandinavia
When we were in Norway few years ago, I was surprised to find that most of our accomodations took only cash. These were smaller places, B & Bs and Pensions. I had suspected as much before our trip as none of them asked for a credit card to hold the reservation. I used credit card where I could if there was no extra charge for doing so, but did need quite a bit of cash.
I am expecting the same for a trip coming up to Germany and Austria as, again, none of the places asked for a credit card with our reservations.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
My bank, in America, usually works pretty well.obgraham wrote:And you get those 150 euros, where?WHL wrote:I don't use a debit / ATM card here at home in the states so I wouldn't even think about doing it when I'm overseas. ...I carry some (~150) euros in case I really need something from a vendor that won't take a CC.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
So you are still paying to exchange cash. I expect the exchange fee, even if buried in the conversion rate buy/sell spread, will be higher in the US than it would be using an ATM in Europe.My bank, in America, usually works pretty well
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Yep. They don't use the interbank rate usually (ever?)obgraham wrote:So you are still paying to exchange cash. I expect the exchange fee, even if buried in the conversion rate buy/sell spread, will be higher in the US than it would be using an ATM in Europe.My bank, in America, usually works pretty well
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
But if it is only 150 euros, the cost is probably about $10. I got 100, just so we have some when we arrive, the cost was $138.xx on a day when google said the exchage rate would have given a cost of $130.xx.curiouskitty wrote:Yep. They don't use the interbank rate usually (ever?)obgraham wrote:So you are still paying to exchange cash. I expect the exchange fee, even if buried in the conversion rate buy/sell spread, will be higher in the US than it would be using an ATM in Europe.My bank, in America, usually works pretty well
I expect to make use of ATMs, though, and will probably try to have some euros left at the end, then next time we won't need to get any from the bank ahead of time (not yet ready to arrive with no local currency).
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I'll make sure I ask Chase on Monday when I convert more dollars for Euros. I'm really not concerned about a few dollars. It's a million times more convenient to do the exchange here when I'm not pressed for time. The last place I want to be scrambling for a conversion is while I'm in the Frankfurt airport, or carless while I'm at my destination in Germany.obgraham wrote:So you are still paying to exchange cash. I expect the exchange fee, even if buried in the conversion rate buy/sell spread, will be higher in the US than it would be using an ATM in Europe.My bank, in America, usually works pretty well
Convenience > money almost all of the time (which is why I use my CC when possible).
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
On a day when Visa was giving 1 Euro = 1.310569 United States Dollar, Chase bank gave me 1 Euro = 1.3871, so they charges about 5.8%, but Chase apparently charges 3% conversion fee for ATM withdrwals and it appears the ATM networks charges 1%. Does Visa also have a 1% charge built into their exchange rate?
However some banks (Schwab) charge no exchage fees, so you only pay the 1% that the ATM network charges.
However some banks (Schwab) charge no exchage fees, so you only pay the 1% that the ATM network charges.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
With Schwab, you don't even pay that 1%. Nor with the other debit card that I use (credit union).jeffyscott wrote:On a day when Visa was giving 1 Euro = 1.310569 United States Dollar, Chase bank gave me 1 Euro = 1.3871, so they charges about 5.8%, but Chase apparently charges 3% conversion fee for ATM withdrwals and it appears the ATM networks charges 1%. Does Visa also have a 1% charge built into their exchange rate?
However some banks (Schwab) charge no exchage fees, so you only pay the 1% that the ATM network charges.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I certainly see no problem with paying a bit extra (for Euros) for piece of mind before you land. Personally, what I do, is that I always have some USA dollars with me. You never know when the networks for ATM/Debit/Credit cards might be down (a common occurrence in many places) or you may not have convenient access to a machine. There seems to always be a currency changer at any airport, and that is where I head if I don't know where the ATM machine is located or I can't be bothered. Just enough to get me started safely on my trip and I put safety over small money considerations.
If I am flying internationally into a smaller airport in a developing country, I will sometimes try to get some currency ahead of time as a backup. I wish I had done that on my first trip to Colombia into the podunk Cartagena airport when I was landing there very late at night. I was a bit nervous and confused and walked out of the airport and my ride was waiting there, I had forgotten to go to the ATM machines. He took me to my host family (Spanish school). But I felt weird having no local currency until the next afternoon which you need for almost everything. Although I was surprised at the shockingly expensive exchange rates at Florida airports (something like a 15% take for Colombian Peso).
If I am flying internationally into a smaller airport in a developing country, I will sometimes try to get some currency ahead of time as a backup. I wish I had done that on my first trip to Colombia into the podunk Cartagena airport when I was landing there very late at night. I was a bit nervous and confused and walked out of the airport and my ride was waiting there, I had forgotten to go to the ATM machines. He took me to my host family (Spanish school). But I felt weird having no local currency until the next afternoon which you need for almost everything. Although I was surprised at the shockingly expensive exchange rates at Florida airports (something like a 15% take for Colombian Peso).
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Actually I'd read something referring to a 1% fee, but looking into this a bit more, I think this is just the spread. If you bought and then sold euros at the exchange rates used, you would end up with 1% less. Visa credit card exchange rates result in about a 1% spread also. So it would appear that the ATM exchange rate is the same as used for credit cards.kramer wrote:With Schwab, you don't even pay that 1%. Nor with the other debit card that I use (credit union).
So yes, no extra fees and a very good exchange rate.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Schwab has no 1% fee-- it has no fees at all (no ATM, international fees, etc). They also give you the daily Visa rate at withdrawal.jeffyscott wrote:Actually I'd read something referring to a 1% fee, but looking into this a bit more, I think this is just the spread. If you bought and then sold euros at the exchange rates used, you would end up with 1% less. Visa credit card exchange rates result in about a 1% spread also. So it would appear that the ATM exchange rate is the same as used for credit cards.kramer wrote:With Schwab, you don't even pay that 1%. Nor with the other debit card that I use (credit union).
So yes, no extra fees and a very good exchange rate.
You are thinking about Fidelity which has a 1% international fee but no other fees.
Lots of credit cards have no international fee: chase sapphire preferred, penfed rewards (added bonus of chip and pin)
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
No, I have no knowlege of Fidelity but the cost is actually 0.5%. As I indicated there is a spread of 1%, a buy/sell round trip would cost 1%. So in that way, there is an unavoidable cost of 0.5% in pulling Euros from an ATM with Schwab or other ATM cards that reinimburse all ATM fees. The same would be the case when paying with a credit card that has no exchange fees.Gleevec wrote:You are thinking about Fidelity which has a 1% international fee but no other fees.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I dont know if that is accurate because my foreign Schwab ATM withdrawals from a recent trip were precisely the Visa exchange rate the day I made the withdrawal.jeffyscott wrote:No, I have no knowlege of Fidelity but the cost is actually 0.5%. As I indicated there is a spread of 1%, a buy/sell round trip would cost 1%. So in that way, there is an unavoidable cost of 0.5% in pulling Euros from an ATM with Schwab or other ATM cards that reinimburse all ATM fees. The same would be the case when paying with a credit card that has no exchange fees.Gleevec wrote:You are thinking about Fidelity which has a 1% international fee but no other fees.
I cannot vouch for if the Visa exchange rate has the fee you describe incorporated in it, that said, I can safely say that Schwab has zero foreign transaction fees (or at least effectively zero since all cards have it, if your comment is true of Schwab). Fidelity has 1% internationally but Ive actually somehow avoided being charged it, but it is stated clearly on their site
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Go here: http://corporate.visa.com/pd/consumer_s ... _rates.jsp
Do $ to euros, then do euros to $ and you will see that a round trip has a cost (or spread) of about 1%.
Do $ to euros, then do euros to $ and you will see that a round trip has a cost (or spread) of about 1%.
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
To Highlight the Huge Differences in Exchange Rates:
Let's say we have a bunch of Americans who will be taking a vacation in Singapore. They each have USD 5000 to spend, and they each will use a different method of converting their US dollars to SG dollars. Spot rate is about $1 USD = 1.25079 SGD.
Person #1 Uses his Capital One Visa Card (1.5% cashback) for all transactions. Visa exchange rate is 1.24012. Capital One charges no foreign transaction fee. And the 1.5% cashback actually means this person will actually be getting 0.6% better than spot. Effective exchange rate of 1.25873, so this person can purchase SGD 6294 worth of goods & services.
Person #2 Uses his Schwab Visa debit card at ATM machines in Singapore. Visa/Plus network exchange rate is 1.24012. Schwab charges no foreign transaction fee. And Schwab will reimburse the person for any fees that the foreign bank might charge (Note: it is important that this person declines any foreign ATM's attempt to do the currency conversion; see my previous post above). Effective exchange rate of 1.24012, so this person can purchase SGD 6201 worth of goods & services.
Person #3 Withdraws $5000 from his US bank account, flies to Singapore, goes to a DBS Bank branch in Singapore, and has them change his $5000 USD to SGD. Effective exchange rate of 1.2345, so this person can purchase SGD 6173 worth of goods & services.
Person #4 Withdraws $5000 from his US bank account, has Bank of America (US branch) change this money into SGD, and carries it with him on the plane to Singapore. Effective exchange rate of 1.166, so this person can purchase SGD 5830 worth of goods & services.
Person #5 Withdraws $5000 from his US bank account, changes it at the airport currency changer (travelex). Effective exchange rate of 1.1088, So this person can purchase SGD 5544 worth of goods & services.
Summary: Each person spent USD 5000. But the difference in exchange rates meant that Person #1 had SGD 750 (or USD 600) more to spend than Person #5. Another way to look at it is that Person #1 made +0.6% on the currency conversion, while Person #5 lost -11.4% on the currency conversion (compared to spot rate).
For Reference:
- http://www.xe.com/ucc/convert.cgi?templ ... USD&To=SGD
- http://www.flyerguide.com/wiki/index.ph ... n_Exchange
- http://corporate.visa.com/pd/consumer_s ... _rates.jsp
- http://www.dbs.com/ratesonline/Pages/fxbra.aspx
- https://www4.bankofamerica.com/foreignc ... tor.action
- http://www.travelex.com/US/For-Individu ... nge-Rates/
Let's say we have a bunch of Americans who will be taking a vacation in Singapore. They each have USD 5000 to spend, and they each will use a different method of converting their US dollars to SG dollars. Spot rate is about $1 USD = 1.25079 SGD.
Person #1 Uses his Capital One Visa Card (1.5% cashback) for all transactions. Visa exchange rate is 1.24012. Capital One charges no foreign transaction fee. And the 1.5% cashback actually means this person will actually be getting 0.6% better than spot. Effective exchange rate of 1.25873, so this person can purchase SGD 6294 worth of goods & services.
Person #2 Uses his Schwab Visa debit card at ATM machines in Singapore. Visa/Plus network exchange rate is 1.24012. Schwab charges no foreign transaction fee. And Schwab will reimburse the person for any fees that the foreign bank might charge (Note: it is important that this person declines any foreign ATM's attempt to do the currency conversion; see my previous post above). Effective exchange rate of 1.24012, so this person can purchase SGD 6201 worth of goods & services.
Person #3 Withdraws $5000 from his US bank account, flies to Singapore, goes to a DBS Bank branch in Singapore, and has them change his $5000 USD to SGD. Effective exchange rate of 1.2345, so this person can purchase SGD 6173 worth of goods & services.
Person #4 Withdraws $5000 from his US bank account, has Bank of America (US branch) change this money into SGD, and carries it with him on the plane to Singapore. Effective exchange rate of 1.166, so this person can purchase SGD 5830 worth of goods & services.
Person #5 Withdraws $5000 from his US bank account, changes it at the airport currency changer (travelex). Effective exchange rate of 1.1088, So this person can purchase SGD 5544 worth of goods & services.
Summary: Each person spent USD 5000. But the difference in exchange rates meant that Person #1 had SGD 750 (or USD 600) more to spend than Person #5. Another way to look at it is that Person #1 made +0.6% on the currency conversion, while Person #5 lost -11.4% on the currency conversion (compared to spot rate).
For Reference:
- http://www.xe.com/ucc/convert.cgi?templ ... USD&To=SGD
- http://www.flyerguide.com/wiki/index.ph ... n_Exchange
- http://corporate.visa.com/pd/consumer_s ... _rates.jsp
- http://www.dbs.com/ratesonline/Pages/fxbra.aspx
- https://www4.bankofamerica.com/foreignc ... tor.action
- http://www.travelex.com/US/For-Individu ... nge-Rates/
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
normaldude, what about the person who doesn't have a no-transaction-fee card and won't be getting cash back? Is the card still better than getting cash like Person #3? Where does this fall on the spectrum?
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Difficult to say.Duckie wrote:normaldude, what about the person who doesn't have a no-transaction-fee card and won't be getting cash back? Is the card still better than getting cash like Person #3? Where does this fall on the spectrum?
1) Each US bank / credit card company has different foreign transaction fees, ranging from 0-3%, which is on top of the Visa/MC/Plus/CIrrus exchange rate (which will be around 1% premium over spot).
http://www.flyerguide.com/wiki/index.ph ... n_Exchange
2) DBS bank in Singapore has relatively good exchange rates (about 1.3% premium over spot). But different banks in different countries with different currencies might have wildly different exchange rate spreads, and might end up charging 1-5% premium over spot. For example, HSBC bank in Singapore charges about 2% premium over spot.
So I know that my above scenario #1 and #2 are good in nearly any country (Capital One Visa card at POS; or Schwab checking Visa debit card at ATM machine, with reimbursement of any fees that the other bank's ATM might charge).
And I know that scenario #5 (airport currency changer) tends to have the worst exchange rates.
And from my experience, it seems that exchange rate spreads at banks in USA tend to be worse than banks in foreign countries.
But if you're comparing using credit/debit cards vs foreign bank currency exchange, you'll have to compare the specific card's terms versus the specific bank's exchange rate.
Either way, refer to the above flyerguide.com page to figure out which is your #1 credit/debit card for foreign POS, and which is your #1 debit card for foreign ATMs (try not to use a credit card at a foreign ATM, or else cash advance interest charges will start accruing, with no grace period).
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
2.7% - #1 credit card for foreign POSnormaldude wrote:Either way, refer to the above flyerguide.com page to figure out which is your #1 credit/debit card for foreign POS, and which is your #1 debit card for foreign ATMs (try not to use a credit card at a foreign ATM, or else cash advance interest charges will start accruing, with no grace period).
3.0% - #1 debit card for foreign ATMs
Looks like I'm stuck paying high fees.
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Capital One and/or Bank of America may pay you $100 to get a credit card with no foreign transaction fee and 1.5% rebates.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Just wanted to finish my part of the discussion.
I went to Chase today to "buy" Euro's for an upcoming trip. I told her I wanted 150 euros, and the USD cost was $210.39. I asked her what the fee was, she said Chase didn't charge a fee. I immediately Google'd the USD > euro exchange rate, and it said 1.32 dollars per euro. She said the rate on her screen was 1.40 dollars per euro (which is confirmed on my receipt), so there's a built in 8 cent fee.
If I did my math right, that's a 5.8% fee. I'm okay with that on the small amount of conversions I do annually.
I went to Chase today to "buy" Euro's for an upcoming trip. I told her I wanted 150 euros, and the USD cost was $210.39. I asked her what the fee was, she said Chase didn't charge a fee. I immediately Google'd the USD > euro exchange rate, and it said 1.32 dollars per euro. She said the rate on her screen was 1.40 dollars per euro (which is confirmed on my receipt), so there's a built in 8 cent fee.
If I did my math right, that's a 5.8% fee. I'm okay with that on the small amount of conversions I do annually.
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
PenFed is now offering a 'chip & pin' option for their Visa Rewards card. (probably for their other cards also) For more info, look under your account details for the card.
I usually use my Vanguard Advantage debit card to get foreign cash. I've never had a fee and the conversion rates are good. I think the rate is 1% above the bid/ask rate.
I used both my Vanguard card (for cash) and my PenFed Visa card (for a purchase) within a few minutes of each other when I arrived last month. I was surprised that the PenFed conversion rate was about 1% better than the Vanguard rate (1.2929 vs 1.3072). The difference might be due to the speed and date of conversion. I would guess the markup would be about the same.
I usually use my Vanguard Advantage debit card to get foreign cash. I've never had a fee and the conversion rates are good. I think the rate is 1% above the bid/ask rate.
I used both my Vanguard card (for cash) and my PenFed Visa card (for a purchase) within a few minutes of each other when I arrived last month. I was surprised that the PenFed conversion rate was about 1% better than the Vanguard rate (1.2929 vs 1.3072). The difference might be due to the speed and date of conversion. I would guess the markup would be about the same.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I thought Vanguard Advantage is PNC, which not only has a non-PNC ATM fee in the US but internationally as well?Jeff Albertson wrote:PenFed is now offering a 'chip & pin' option for their Visa Rewards card. (probably for their other cards also) For more info, look under your account details for the card.
I usually use my Vanguard Advantage debit card to get foreign cash. I've never had a fee and the conversion rates are good. I think the rate is 1% above the bid/ask rate.
I used both my Vanguard card (for cash) and my PenFed Visa card (for a purchase) within a few minutes of each other when I arrived last month. I was surprised that the PenFed conversion rate was about 1% better than the Vanguard rate (1.2929 vs 1.3072). The difference might be due to the speed and date of conversion. I would guess the markup would be about the same.
Love the Penfed Visa internationally though with chip and pin!
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Great info on no fee credit cards and debit cards used internationally. Thanks everyone for your collective wisdom.
Drum
Drum
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I did a similar analysis after I returned from a trip to China last fall, and having seen this thread I thought it would be worthwhile to share my findings:
This was a comparison between several different methods of exchange, including the airport FX windows, credit card purchases, and ATM withdrawals. After taking into account all fees, I compared the effective exchange rates to the official rates (according to Google). The percentage difference from the official rate is shown in the "Eff. Diff." column.
The interesting thing to note is that I have an Amex Blue Cash credit card, which carries a foreign transaction fee of 2.7%. But the exchange rates Amex used for the transactions were close enough to the official rate (in one instance higher) that it netted out more favorably than the other methods I tried. The ATM's I used did not charge any fee, but they did take a spread of about 3.0%. The Chase credit card performed a dynamic currency conversion for a loss of more than 4%.
Note also that I didn't bother to account for the 1.25% cash back received on the Amex purchases, which would make it even more favorable overall. Of course an Amex Platinum card would likely be better still (since it would presumably get the same exchange rates without incurring the FTF), but there's more to consider in that equation.
I guess the takeaway is that you shouldn't necessarily be scared off by the "foreign transaction fee" on some cards -- it at least makes it clear what you are actually paying.
This was a comparison between several different methods of exchange, including the airport FX windows, credit card purchases, and ATM withdrawals. After taking into account all fees, I compared the effective exchange rates to the official rates (according to Google). The percentage difference from the official rate is shown in the "Eff. Diff." column.
The interesting thing to note is that I have an Amex Blue Cash credit card, which carries a foreign transaction fee of 2.7%. But the exchange rates Amex used for the transactions were close enough to the official rate (in one instance higher) that it netted out more favorably than the other methods I tried. The ATM's I used did not charge any fee, but they did take a spread of about 3.0%. The Chase credit card performed a dynamic currency conversion for a loss of more than 4%.
Note also that I didn't bother to account for the 1.25% cash back received on the Amex purchases, which would make it even more favorable overall. Of course an Amex Platinum card would likely be better still (since it would presumably get the same exchange rates without incurring the FTF), but there's more to consider in that equation.
I guess the takeaway is that you shouldn't necessarily be scared off by the "foreign transaction fee" on some cards -- it at least makes it clear what you are actually paying.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
This is more a downside for ATM cards (where you have liability) than credit cards where there is no liability and even if it is stolen, may be a pain, but the financial risk is on the credit card company.normaldude wrote: Downside of Credit Cards: If you're in a high crime, 3rd world country, there might be an increased chance your credit card info will be stolen/skimmed whenever it gets used. I've read that in those types of countries, you only want to use your credit card at the luxury hotels.
And for the record, I have used credit cards all over the 3rd world extensively (including countries like the Congo and Paraguay that certainly qualify as high crime) and the only places I have ever had my credit card number used fraudulently has been in the US. So I'm not sure the chance is actually any higher - just the fear.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Or get different cards/bank accounts - you aren't stuck at all.Duckie wrote:2.7% - #1 credit card for foreign POSnormaldude wrote:Either way, refer to the above flyerguide.com page to figure out which is your #1 credit/debit card for foreign POS, and which is your #1 debit card for foreign ATMs (try not to use a credit card at a foreign ATM, or else cash advance interest charges will start accruing, with no grace period).
3.0% - #1 debit card for foreign ATMs
Looks like I'm stuck paying high fees.
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I'm an airline pilot who spends over 300+ days a year working overseas, on every continent except Antarctica.
99% of my transactions are handled with my Capital One card.
The remaining 1% Ill use cash, pulled from an ATM.
Most ATM's overseas charge a fee, and this fee is typically not reimbursed by my bank, USAA. When I find a "fee free" ATM, I stick with it exclusively when in country.
The credit card offers peace of mind in the event of a lost/stolen wallet. Cash is easy to lose, especially in some of the shadier parts of the world.
I absolutely positively stay away from airport currency exchanges.
99% of my transactions are handled with my Capital One card.
The remaining 1% Ill use cash, pulled from an ATM.
Most ATM's overseas charge a fee, and this fee is typically not reimbursed by my bank, USAA. When I find a "fee free" ATM, I stick with it exclusively when in country.
The credit card offers peace of mind in the event of a lost/stolen wallet. Cash is easy to lose, especially in some of the shadier parts of the world.
I absolutely positively stay away from airport currency exchanges.
Re: No Foreign Transaction Fee Credit Card WITH 1 TIME Passw
Hello, I have an ATT universal Card, it will create a one time use CC number with an offline application.
Is anyone aware of another card that does this?
I would like to find one with no FTF AND also this feature, so I would not need 2 cards, which I have now thanks
Is anyone aware of another card that does this?
I would like to find one with no FTF AND also this feature, so I would not need 2 cards, which I have now thanks
“The history of Paris teaches us that beauty is a by-product of danger, that liberty is at best a consequence of neglect, that wisdom is entwined with decay."
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
I have a "world" credit card, but my AmericanBank ATM beats it hands down by simply pulling cash at foreign ATM's. Transaction fee is about $1.50, but the exchange rate is more favorable.
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Depends on the country as others said. My experience from a great trip to Japan, got back yday!
1. Changed all money using bofa online. Good service in us. Yen sent to local us branch near home. Got a rate near 97 yen to the dollar. No other fees. Seemed a better option than most others in the us. Travelex etc
2. Needed yen as soon as we landed. Glad I had some and didn't have to waste time at midnight local time
3. Didn't waste any time searching for and changing money in Japan. Rates seemed same or worse. Key was piece of mind.
4. Had plenty leftover even after trying to spend at duty free. (Once a frugal bg, always a frugal bg
5. Changed back currency at tokyo airport with a local bank. Got 97 rate so didn't lose anything in the conversion. Travelex seemed a worse option again.
Most places in Japan want yen cash. Happy I did all above for convenience, plus avoided language barrier for this topic.
Kanpai!
1. Changed all money using bofa online. Good service in us. Yen sent to local us branch near home. Got a rate near 97 yen to the dollar. No other fees. Seemed a better option than most others in the us. Travelex etc
2. Needed yen as soon as we landed. Glad I had some and didn't have to waste time at midnight local time
3. Didn't waste any time searching for and changing money in Japan. Rates seemed same or worse. Key was piece of mind.
4. Had plenty leftover even after trying to spend at duty free. (Once a frugal bg, always a frugal bg
5. Changed back currency at tokyo airport with a local bank. Got 97 rate so didn't lose anything in the conversion. Travelex seemed a worse option again.
Most places in Japan want yen cash. Happy I did all above for convenience, plus avoided language barrier for this topic.
Kanpai!
“At some point you are trading time you will never get back for money you will never spend.“ |
“How do you want to spend the best remaining year of your life?“
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
penfed from what i can see, is only for those with military and government connections, one should disclaim
Jeff Albertson wrote:PenFed is now offering a 'chip & pin' option for their Visa Rewards card. (probably for their other cards also) For more info, look under your account details for the card.
I usually use my Vanguard Advantage debit card to get foreign cash. I've never had a fee and the conversion rates are good. I think the rate is 1% above the bid/ask rate.
I used both my Vanguard card (for cash) and my PenFed Visa card (for a purchase) within a few minutes of each other when I arrived last month. I was surprised that the PenFed conversion rate was about 1% better than the Vanguard rate (1.2929 vs 1.3072). The difference might be due to the speed and date of conversion. I would guess the markup would be about the same.
“The history of Paris teaches us that beauty is a by-product of danger, that liberty is at best a consequence of neglect, that wisdom is entwined with decay."
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Just saw this. I've been to Japan several times and have just used a credit card everywhere. Most places did not need cash. In particular, hotels, trains, restaurants, shops did not need cash. What do the folks who live in Japan say about this?Wannaretireearly wrote:Most places in Japan want yen cash. Happy I did all above for convenience, plus avoided language barrier for this topic.
Kanpai!
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Keep the 2 cards. If you travel much, sooner or later you will have a card rejected, due to some flubbup. Then you'll be glad of a second card....so I would not need 2 cards, which I have now thanks
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Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
There are several ways to join PenFed, see here:kwan2 wrote:penfed from what i can see, is only for those with military and government connections, one should disclaim
Jeff Albertson wrote:PenFed is now offering a 'chip & pin' option for their Visa Rewards card. (probably for their other cards also) For more info, look under your account details for the card.
I usually use my Vanguard Advantage debit card to get foreign cash. I've never had a fee and the conversion rates are good. I think the rate is 1% above the bid/ask rate.
I used both my Vanguard card (for cash) and my PenFed Visa card (for a purchase) within a few minutes of each other when I arrived last month. I was surprised that the PenFed conversion rate was about 1% better than the Vanguard rate (1.2929 vs 1.3072). The difference might be due to the speed and date of conversion. I would guess the markup would be about the same.
https://www.penfed.org/About-PenFed/
Note that you can make a one-time $15 or $20 donation to a military charity to qualify for membership.
(edit: revised link)
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
hmm, ok thanks but is the chip and PIN, this type ??:
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Some US banks are now issuing Chip and PIN cards for their affluent customers who travel a lot. However, even though these credit cards have chips on board, they are really Chip and Signature cards, since they require verification with a signature, not an encoded PIN on the card. As a result they will not work on standalone kiosks for Chip and PIN cards, and also have similar increased vulnerabilities to the traditional magnetic swipe cards.
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might be better than having a Cap One MC and Cap One Visa as a backup ; to have a separate institution , for no FTF.
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Some US banks are now issuing Chip and PIN cards for their affluent customers who travel a lot. However, even though these credit cards have chips on board, they are really Chip and Signature cards, since they require verification with a signature, not an encoded PIN on the card. As a result they will not work on standalone kiosks for Chip and PIN cards, and also have similar increased vulnerabilities to the traditional magnetic swipe cards.
--
might be better than having a Cap One MC and Cap One Visa as a backup ; to have a separate institution , for no FTF.
Jeff Albertson wrote:There are several ways to join PenFed, see here:kwan2 wrote:penfed from what i can see, is only for those with military and government connections, one should disclaim
Jeff Albertson wrote:PenFed is now offering a 'chip & pin' option for their Visa Rewards card. (probably for their other cards also) For more info, look under your account details for the card.
I usually use my Vanguard Advantage debit card to get foreign cash. I've never had a fee and the conversion rates are good. I think the rate is 1% above the bid/ask rate.
I used both my Vanguard card (for cash) and my PenFed Visa card (for a purchase) within a few minutes of each other when I arrived last month. I was surprised that the PenFed conversion rate was about 1% better than the Vanguard rate (1.2929 vs 1.3072). The difference might be due to the speed and date of conversion. I would guess the markup would be about the same.
https://www.penfed.org/About-PenFed/
Note that you can make a one-time $15 or $20 donation to a military charity to qualify for membership.
(edit: revised link)
“The history of Paris teaches us that beauty is a by-product of danger, that liberty is at best a consequence of neglect, that wisdom is entwined with decay."
Re: No Foreign Transaction Fee Credit Card vs. ATM and Cash
Does anyone else have experience here? I may want to get the Vanguard Advantage debit card assuming it has no foreign transaction fee (similar to Schwab). The PenFed debit card for access via ATM charges 2% Internationally (this differs from the credit card).Jeff Albertson wrote:I usually use my Vanguard Advantage debit card to get foreign cash. I've never had a fee and the conversion rates are good. I think the rate is 1% above the bid/ask rate.
I used both my Vanguard card (for cash) and my PenFed Visa card (for a purchase) within a few minutes of each other when I arrived last month. I was surprised that the PenFed conversion rate was about 1% better than the Vanguard rate (1.2929 vs 1.3072). The difference might be due to the speed and date of conversion. I would guess the markup would be about the same.
Does one have to apply to open the Vanguard Advantage account? If so, is it like opening a new bank account where they go through Patriot Act verification?
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