Credit Card Fees While Traveling Abroad

Credit Card FeesOne of the biggest problems while traveling abroad, is how will you pay for things? Carrying cash might be a better option if you are trying to escape the high fees charged for using your credit card overseas, but it’s not as safe as carrying plastic.

Many banks will charge a different fee for transactions in different countries. While carrying cash you tend to get better exchange rates, but if you cannot find a forex exchange you are out of luck. Having a credit card in another country such as Europe would be much more convenient than having cash, as you can use your credit card at any time.

Overview of Fees

When you use your Visa or MasterCard overseas they will charge you 1% for the conversion fee and most US banks will add their own 2% fee on top of that to make your total fees 3%. When using a debit (ATM) card for cash outside of the USA, most banks will add some kind of withdrawal fee up to $5 and a conversion fee of up to 3%.

Cash exchanges are not always better as the forex you exchange your money over to will charge you fees and other charges. Sometimes you can lose from 5% to 10% depending on the country you visit.

It’s still recommended to use “credit cards” for your big purchases; use debit cards for cash and just forget about using traveler’s checks and exchanging currency. Not only do you save money by using credit cards, but your money will be safer than carrying around a large sum of money.

Credit Card Charges in Foreign Currency

When using your credit card outside of the USA, the charge will be in the currency of the country you are visiting. When that charge goes through the banking system and reaches your bank they will put their own surcharges onto the already 1% charge by the International network. The bank will add another 2% fee just because they can, just because you needed money outside of your country of residence.

There are still some good banks that do not add surcharges or at least keep the fees low. Here are current charges for some of the large credit card issuers, in order from lowest to highest in fees.

  • Capital One: 0 percent
  • USAA: 1 percent
  • Barclaycard/Juniper: 2 to 3 percent
  • American Express: 2.7 percent
  • Bank of America: 3 percent
  • Citibank/Diners: 3 percent
  • Diners Club: 3 percent
  • HSBC: 3% (most)
  • JP Morgan Chase: 3% (most)
  • US Bank: 3 percent
  • Wells Fargo: 3 percent

So far no other credit card issuer is as good as Capital One in regards to international credit card fees. USAA comes a close second with charging 1%, while HSBC and Chase offer reduced charges to the small number of ‘elite’ customers, but overall they still end up charging 3%.

Credit card charges, U.S. dollars

Sometimes a foreign merchant will charge you in U.S. dollars rather than in their local currency. Banks overall are inconsistent in how they come up with their charges: Bank of America, Barclaycard/Juniper, Citibank/Diners and USAA are usually the credit cards that charge the same fee regardless of the currency, but American Express, JP Morgan Chase and Wells Fargo do not surcharge dollar billings.

Dollar billings can seem like a good idea, but you must be aware of a possible scam. The merchant can use a very lousy exchange rate with they convert your bills into US dollars, so you could end up paying both the merchant’s private currency markup in addition to a surcharge. Avoid any billing in dollars and just stick to credit cards while traveling.

Debit (ATM) cards for cash

It used to be that you could withdraw money from an ATM and pay a flat fee for each withdrawal regardless of how much money you take out. However, some large banks have been adding their own conversion surcharge to any foreign ATM withdrawal. Here are the current costs per transaction and exchange surcharges for withdrawing cash from a foreign ATM:

  • Bank of America (a): $0/0 percent
  • Bank of America: $5/1 percent
  • Citibank (b): $0/1 percent
  • Citibank $1.50/1 percent
  • JP Morgan Chase: $3/3 percent
  • US Bank $2/1 percent
  • USAA: $0/1 percent
  • Wells Fargo: $5/0 percent

(a) At ATMs operated by members of Global ATM Alliance
(b) At ATMs in overseas CITI branches

This shows ways to avoid losing more than 1% on foreign ATM withdrawals:

  • If you have (or open) an account with Bank of America, you can withdraw foreign currencies from ATMs owned by member banks of the “Global ATM Alliance” with no transaction or conversion fee: Westpac in Australia and New Zealand, Scotia Bank in Canada, China Construction Bank in China, Paribas in France, Deutsche Bank in Germany, Santander Serfin in Mexico, and Barclays Bank in the UK. All seven banks have branches throughout their home countries (as well as a few foreign locations); you can locate them through the BofA website. In other countries, however, BofA charges more than most other banks.
  • If you have (or open) an account with Citi you can withdraw foreign currencies from ATMs at Citi branches outside the US with no transaction fee. Citi has branches in dozens of foreign countries: In some, it has retail branches throughout the country; in others, it has only one or two offices in one or two major cities. You can easily find out whether a Citi account will work for your trip by checking the worldwide branch locator on the Citi website.
  • Many small banks or the larger banks with ‘elite’ customer account add no extra fees of their own and even agree to pay back fees that other banks may apply, of course with limits to the number of withdrawals per month.

The spread between some of the best and the worst deals on debit card withdrawals is wider than the spread among credit cards. The best deal such as Citi and the Global ATM Alliance, are as good as the best credit cards, but the worst deals you can end up losing more than when you exchange cash or use travelers checks.

Always use a debit card for local currency from an ATM and not a credit card. If you use a credit card to get cash you will be hooked on paying more fees along with cash advanced fees and higher interest rates.

Debit cards for purchases

Many debit cards are Visa and MasterCard branded, so you can use them worldwide for shopping or to take cash out of an ATM. When using your ATM card most banks will still charge the same as they do on their credit cards for purchases. HSBC, however adds just 1% on charges rather than the usual 3% that most other banks charge.

Buyers’ guide

The overall recommendations for saving money on credit card and debit card fees while traveling and to minimize your exchange losses:

  • Put large charges on credit cards. If you travel outside the U.S. a lot, consider getting a Capital One card, with its zero surcharge (and a reasonably generous reward program). Otherwise, USAA and many smaller banks and credit unions charge only 1%. Even cards with a full 3% surcharge are still an efficient way to pay outside the U.S.
  • Use your debit (ATM) card for whatever local currency you need. When you take cash out of an ATM, withdraw large amounts each time to limit the fees you are charged.

And overall, use plastic (credit cards and debit cards), but be sure it’s the right plastic, otherwise you will pay for it in extra fees.

Best CD Rates in Texas – October 2009

Below you will see the best CD rates for the state of Texas.

We have reviewed and sifted through many banks to find the best local rates Dallas Texas has to offer.

While with local CD rates you often get the personal touch of a friendly local banker, you may find the rates to be just under the national average.  You can check out our best cd rates to help you determine whether your local cd rates or national cd rates are better.

We determine the “highest” local rates by factoring in the CD rates with their respective term and comparing them to the national average.

Here are Dallas Texas’ best local CD rates.

6 Month

  • Texas Federal Credit Union – 1.92% APY – Minimum deposit = $1,000
  • SouthWest Airlines Federal Credit Union – 1.90% APY  – Minimum deposit = $1,000

12 Month

  • Baxter Credit Union – 2.50% APY – Minimum deposit = $50
  • SouthWest Airlines Federal Credit Union – 2.50% APY – Minimum deposit = $1,000
  • Branch Banking and Trust Company – 2.25% APY  – Minimum deposit = $2,500

24 Month

  • First National Bank – 2.68% APY – Minimum deposit = $1,000
  • SouthWest Airlines Federal Credit Union – 2.60% APY – Minimum deposit = $1,000
  • Washington Federal Savings and Loan Association – 2.50% APY – Minimum deposit = $1,000

All of the financial institutions mentioned above are insured by the FDIC or the NCUA.

Remember CD rates are time sensitive.  Please check with the financial institution for current rates and more details.  Refer to the date of this article for probable accuracy of cd rates.

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Best CD Rates in Washington State – August 2009

The best local CD rates right now can be found at Washington Federal Savings Bank.

If you are located outside the state of Washington then you can check out our national best cd rates.

Typically we see local rates just under the national average for CD rates with their respective terms.  At Washington Federal Savings Bank we noticed on some of their long term CD’s like the 2, 3 and 5 year they are better then the national average.  While their short term CD rates, like the 6 and 12 month, are about even.

Here are Washington Federal Savings Banks CD Rates for August 2008:

  • 24 month CD – 2.50% APY – Minimum Deposit = $1,000.
  • 36 month CD – 2.75% APY – Minimum Deposit = $1,000
  • 48 month CD – 3.0% APY Minimum Deposit = $1,000

Washington Federal Savings Bank is FDIC insured, and also lends to Idaho.

So if you live in Washington or Idaho you can take advantage of these amazing local CD Rates.

Remember CD rates are time sensitive.  Please check with the financial institution for current rates and more details.  Refer to the date of this article for probable accuracy of cd rates.

Special CD Rates for South Carolina- August 2009

As the nation average for 12 month and 24 month CD(certificate of deposit) Rates sit at 1.70% and 2.05% respectively, residents of South Carolina can take advantage of a much better special offer from Enterprise Bank of SC.

Right now, August 13th, Enterprise Bank is running a promotion on their 15 month and 27 month CD’s.

  • 15 Month CD: get a rate as high as 2.50% APY
  • 27 Month CD: Rates as high as 3.25% APY

If you are a resident of SC you can take advantage of these great deals.  Applications for these promotional CDs are only excepted in their branches.

Enterprise Bank Branches include:

Bamberg Office | Barnwell Office | Blackville Office | Cottageville Office
Edisto Office | Ehrhardt Office | Ridgeville Office | Springfield/Salley Office
Walterboro Bells Hwy Office | Walterboro Jefferies Office | Williston Office

(Please refer to Enterprise Bank web page for details on minimum deposits and other local CD information here.)

Best Local CD Rates for West Virginia – August 2009

We have compiled a list of the best CD (certificate of deposit) rates available in West Virginia.

Local and National CD rates often differ, and you may find CD rates that are better Nationally then Locally.  Be sure to check out our best cd rates, compare and contrast those with the local CD rates from West Virgina below.

It is hard to determine the “highest” cd rates because the term of the CD has a huge impact on the rate you receive.  So instead we have compared the CD rates to the national average and here are the best Local West Virgina Rates as compared to the national averages.

Best CD Rates for West Virginia

Mercer County Teachers Federal Credit Union
Term Rate Min. Deposit
6 month 2.17% $1,000

Mercer County Teachers Federal Credit Union is located in Bluefield, WV.

Alloy Federal Credit Union
Term Rate Min. Deposit
24 month 2.75% $1,000

Alloy Federal Credit Union is located in Fayetteville, WV.

Capon Valley Bank
Term Rate Min. Deposit
15 month 2.25% $5,000
28 month 2.75% $5,000

Capon Valley Bank is located in Wardensville, WV.

  • All of the financial institutions above are federally insured by either the FDIC or NCUA.

Remember all CD rates are time sensitive.  Please refer to the local bank or financial institution for exact quotes on current CD rates.  You can also refer to the date of this article to determine the potential accuracy.

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