How Much Can Your Money Get You: Travel Money Cards or Debit/Credit Cards?
Low foreign exchange rates have put many of us off from going abroad to the United States or the Eurozone, but there's a well-kept secret that's increasingly attractive from a financial and practical perspective: travel money cards.
So what are travel money cards, you ask?
These cards are fairly new additions to the cards that are already on the market out there, and they provide you the ability to place a certain amount of a specific currency on the card at a predetermined exchange rate, so that you have instant access to currency when you travel.
You can purchase via the Internet, and send funds to your card online, via phone, or even (on some cards) by sending a text message. At the moment travel money cards support pounds, dollars, and euros.
How are travel money cards better than traditional credit cards?
First, you'll find a much superior exchange rate with these cards than established bureaux de change, located on the High Street. You also are given a fixed rate when you have downloaded money to the card, so you can keep track of how much you're spending each time it's used overseas; while credit and debit cards operate on a real-time exchange rate for each transaction, so it's hard to track your spending.
So is that all there is?
Not at all. When you use a traditional credit card or debit card to make a purchase abroad, you are typically charged around 2.75% of the transaction as a fee for the foreign currency exchange.
If you didn't know, debit and credit cards might also elicit an additional "till charge" when used in restaurants or shops, though the currency exchange card doesn't have this cost. Be aware that debit and credit cards have high rates for any cash withdrawals, but the cash on the currency card have been prepaid, not borrowed, so it's not applicable.
That is great news! Now, what are the possible drawbacks?
Since you are uploading currency onto the card in advance to your trip, your vacation is paid for up front, not with credit, so you must save for your trip. But, that may not be a bad thing in the current economy. Currency cards do have fees for taking cash from ATMs, but the associated fees are much less that those incurred with credit or debit cards.
RBS and NatWest (for example) at present have a withdrawal fee of 2%, which is a ridiculous 10 if you withdraw 500! For reference, you'd pay a one off fee as low as 1.50 for an ATM withdrawal on a currency card.
The major disadvantage of a travel money card is that you will be charged as much as 2.75% if you use the card for a currency that wasn't assigned to it when it was issued. For instance, if you paid for something in U.S. dollars on a card issued in euros, then you would have to pay this foreign currency exchange fee. There are cards, however, that don't carry an FX charge.
I'm sure some of you are asking about using the excellent foreign usage credit cards that are available instead, right?
Yes, there are such cards (Post Office classic, Nationwide Gold, and Abbey Zero), but the first two -- even though they're good deals, and include no conversion charges -- still have big withdrawal fees (3 minimum, 2.5% of withdrawal) and this doesn't compare favourably with travel money cards -- unless you certainly need credit while travelling.
There are no cash withdrawal or FX fees linked with the Abbey card, however, which makes it the better credit card. Cash withdrawals do carry very high interests rates, though, which are at 25.9%; the cash withdrawal interest rates with Post Office and Nationwide are 20.83% and 22.9%, respectively.
Tell me more. So which travel money cards are the best?
The FairFX Euro Currency card is considered the best among the euro cards at present due to having the lowest ATM charges at 1.50 with a 0% convert fee, with great exchange rates. While the Indigo Travelcard Euro has a fairly low ATM fee at 1.95, it also has a higher convert charge of 2.75%. Then there is the ICE Travellers CashCard Euro which has a high 3, but you have no convert fee.
FairFX also leads the pack on cards where the Dollar is the specific currency. It has no conversion fee, and an ATM cost of only $2. No conversion fee and $3 ATM withdrawals brings the ICE Travellers CashCard Dollar in at a close second. No conversion cost means you can use the cards anywhere.
What's the best travel money card for world travel?
An 'Anywhere Card' has just been released by FairFX as a new global travellers card - an ideal card to take everywhere in the world.
With a FairFX Anywhere Card there are no loading costs and no ATM fees! The only fee that applies is a 1.5% transaction fee which as far as we can tell beats every other similar type of card in the market. - 23221
So what are travel money cards, you ask?
These cards are fairly new additions to the cards that are already on the market out there, and they provide you the ability to place a certain amount of a specific currency on the card at a predetermined exchange rate, so that you have instant access to currency when you travel.
You can purchase via the Internet, and send funds to your card online, via phone, or even (on some cards) by sending a text message. At the moment travel money cards support pounds, dollars, and euros.
How are travel money cards better than traditional credit cards?
First, you'll find a much superior exchange rate with these cards than established bureaux de change, located on the High Street. You also are given a fixed rate when you have downloaded money to the card, so you can keep track of how much you're spending each time it's used overseas; while credit and debit cards operate on a real-time exchange rate for each transaction, so it's hard to track your spending.
So is that all there is?
Not at all. When you use a traditional credit card or debit card to make a purchase abroad, you are typically charged around 2.75% of the transaction as a fee for the foreign currency exchange.
If you didn't know, debit and credit cards might also elicit an additional "till charge" when used in restaurants or shops, though the currency exchange card doesn't have this cost. Be aware that debit and credit cards have high rates for any cash withdrawals, but the cash on the currency card have been prepaid, not borrowed, so it's not applicable.
That is great news! Now, what are the possible drawbacks?
Since you are uploading currency onto the card in advance to your trip, your vacation is paid for up front, not with credit, so you must save for your trip. But, that may not be a bad thing in the current economy. Currency cards do have fees for taking cash from ATMs, but the associated fees are much less that those incurred with credit or debit cards.
RBS and NatWest (for example) at present have a withdrawal fee of 2%, which is a ridiculous 10 if you withdraw 500! For reference, you'd pay a one off fee as low as 1.50 for an ATM withdrawal on a currency card.
The major disadvantage of a travel money card is that you will be charged as much as 2.75% if you use the card for a currency that wasn't assigned to it when it was issued. For instance, if you paid for something in U.S. dollars on a card issued in euros, then you would have to pay this foreign currency exchange fee. There are cards, however, that don't carry an FX charge.
I'm sure some of you are asking about using the excellent foreign usage credit cards that are available instead, right?
Yes, there are such cards (Post Office classic, Nationwide Gold, and Abbey Zero), but the first two -- even though they're good deals, and include no conversion charges -- still have big withdrawal fees (3 minimum, 2.5% of withdrawal) and this doesn't compare favourably with travel money cards -- unless you certainly need credit while travelling.
There are no cash withdrawal or FX fees linked with the Abbey card, however, which makes it the better credit card. Cash withdrawals do carry very high interests rates, though, which are at 25.9%; the cash withdrawal interest rates with Post Office and Nationwide are 20.83% and 22.9%, respectively.
Tell me more. So which travel money cards are the best?
The FairFX Euro Currency card is considered the best among the euro cards at present due to having the lowest ATM charges at 1.50 with a 0% convert fee, with great exchange rates. While the Indigo Travelcard Euro has a fairly low ATM fee at 1.95, it also has a higher convert charge of 2.75%. Then there is the ICE Travellers CashCard Euro which has a high 3, but you have no convert fee.
FairFX also leads the pack on cards where the Dollar is the specific currency. It has no conversion fee, and an ATM cost of only $2. No conversion fee and $3 ATM withdrawals brings the ICE Travellers CashCard Dollar in at a close second. No conversion cost means you can use the cards anywhere.
What's the best travel money card for world travel?
An 'Anywhere Card' has just been released by FairFX as a new global travellers card - an ideal card to take everywhere in the world.
With a FairFX Anywhere Card there are no loading costs and no ATM fees! The only fee that applies is a 1.5% transaction fee which as far as we can tell beats every other similar type of card in the market. - 23221
About the Author:
There's a special offer at the moment with travel money card FairFX where you can get a free euro card, free dollar card or free sterling global travellers card and save the normal 9.95 setup fee (Subject to a very small initial load). Start saving on exchange rates with a travel money card from FairFX travel money exchange today!!
posted by X - Men @ 8:33 AM
0 Comments
