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A big reason to visit Europe
Now is a great time to visit Europe as the euro has lost nearly 25% of its value versus the U.S. dollar. As an example of this let’s take a hotel room in Paris that costs 300 euros. It would have cost you around $415 to stay in that room 12 months ago, when euros cost $1.385. But now that euros cost $1.06 that same room could be yours for just $318.
Regardless of where you intend to vacation there's always the issue of how do you access your funds. There are several ways to do this and one of the most popular and simplest is to use your credit cards. They're both a convenient and effective way to pay for things as you travel. Unfortunately, there are some downsides to using credit cards when abroad. It's important that you know how to use a credit card when outside the US to make sure that you will have both a safe and enjoyable trip. You definitely want to keep your credit card(s) safe and here are some strategies that could help you do just that.
Inform your credit card issuer
First, it's wise to let your credit card issuer know if you will be traveling outside the U.S. The card companies have security software to avoid fraud. The result of this is that your card could be declined if you use it someplace unusual. This makes it a good idea to let your card company know you will be traveling, where you’ll be going and when you'll return.
Avoid high service fees
Make sure you are aware of your options. If you use your credit card within the euro zone your purchase transactions will be free. However, if you make an ATM cash withdrawal within the euro zone you may be charged a high service fee. Be sure to check with your credit card issuer on this before you begin traveling. Make sure you remember the different interest rates on your different cards and their fees for converting currencies, if any. And if possible try to use the card the most that has the lowest interest rate.
Check your perks
You may not be aware of this but there are credit cards that come with perks when you're traveling but the benefits provided by different cards are not the same. These benefits could include concierge services, medical travel insurance benefits, rental car discounts and free breakfasts at hotels. There are also cards that offer rewards or points when you use them to pay for a flight, a hotel stay and more. If you carry more than one credit card try to choose the one that will get you the best rewards. If you find that none of your cards offer these types of rewards you might think about getting a new one just for your trip.
Be safe, not sorry
If you carry multiple credit cards when traveling abroad don't keep them all in one place. Do this and you run the risk of having them stolen or lost. When you leave your hotel room to go out for sightseeing or dinner, you might leave one of your cards in your hotel room and then take the others with you. Also be sure to watch out for skimming devices when you use your cards at unusual locations. Try to check out your credit report from time to time to make sure you have not fallen victim to ID theft.
Get a prepaid card?
Depending on where you will be traveling you might consider getting a prepaid card. The functionality of these cards is quite similar to those of a debit card but the money is not deducted from your checking account. That way if you run into any kind of problem, your checking account won't be affected. Instead, you'll have to deal only with what’s on the card. You should be able to get a prepaid card very easily at your bank.
Magnetic stripe or "Chip and PIN"?
Don't make the mistake of thinking that your credit card will be accepted wherever you go. In addition to talking with your credit card company you might want to talk with your travel agent or your destination hotel. Restaurants, hotels and gift shops generally accept credit cards with magnetic stripes. However, you may find there are places such as small retail stores and automated kiosks that accept only what are called "chip and PIN" credit cards. If you think this could be the case, and you don’t have one of these cards, you may need to contact your bank to get one before leaving
Why to carry multiple cards
You might use just the one credit card at home but it can be a good idea to carry multiple cards when traveling abroad – preferably ones from different issuers. The reason for this is simple. Not every credit card is accepted globally, meaning that a second credit card could come in very handy. If you were to run into a situation where your main credit card isn’t accepted, you'll have a backup that might work.
Have a budget and stick to it
When you plan that dream vacation abroad be sure to calculate how much you can afford to spend. While credit cards can be helpful and convenient they can also be way too easy to use. Don't let yourself get carried away and spend $200 for that jacket that you hadn't budgeted for or $400 for that really cool camera. Carry your itemized budget with you on your smart phone or pad and check it periodically to make sure you’re staying on track. That way when you get home you’ll have a credit card bill(s) you can live with and not one that will cause you to faint away from shock.