Whether you are a globetrotter or not, getting stuck with foreign transaction fees is a nuisance after an overseas trip or online shopping spree. Here in this article I will explain when foreign fees are issued and how to find credit cards that allow you to avoid the fees in order to save money.
Travelling outside of the U.S. can be a rewarding experience. But do not ruin your trip by racking up numerous foreign transaction fees. Shopping online from a foreign company might discourage you to buy after the additional foreign transaction fees are taken into consideration. Foreign transaction fees can make up to 3% of your final bill and can add up very quickly.
Foreign fees are issued when a US cardholder travels overseas and uses their card. Another cause for the fees is shopping online from a foreign company. Many times the fees go unnoticed and build up until the end of the month when a credit card statement is issued. This can be financially stressful and upsetting for many cardholders. Luckily for us, many credit card companies offer cards that waive the foreign transaction fee completely! Below are some tips on how to chose a no foreign transaction fee credit card.
Tip #1 Maintain a good credit score
Credit cards with the best benefits require you to have a good credit score. Credit cards that offer no foreign transaction fees are no different. Maintaining a good credit score will give you more options when choosing a credit card company. With a good credit score, your credit card limits are often much higher than someone who has bad credit. Lower interests rates and no foreign transaction fees are often some of the many benefits of having a credit card and good credit. Use your good credit to opt for the best benefits, including no foreign transaction fees.
Tip #2 Shop Around and Compare Benefits
When shopping around for the best credit card for you, look closely at the benefits offered and compare them to each other. Benefits that might sound good may not be as beneficial to you as other benefits. For instance, earning travel miles might sound like a good bargain, but not for a cardholder who only travels sparingly. Examples of benefits that some card companies might offer may include any of the following:
- No foreign transaction fees
- Travel mileage points
- Cash back
- Low interest rates
Think about your spending habits and which benefits will suit your lifestyle the most. Nerd Wallet is a website that acts as a search engine for consumers looking for the perfect credit card to suit their tastes. Nerd Wallet allows you to find the best credit card that suits your needs with the benefits that accommodate your lifestyle. One of the many options that are offered is cards with no foreign transaction fee. You can also search by interest rates and your current credit score.
Tip #3 Choosing Your Currency Wisely
When using your US credit card to make purchases either overseas or online, sometimes you will have the option to pay in the local currency or to pay in USD. The credit card company that you are using will determine which option is the best for you. If your credit card company offers no foreign transaction fees, paying in the local currency is the best option. Paying in the local currency eliminates the need to convert money. Sometimes converting money results in currency exchange fees. If your credit card company charges foreign transaction fees, paying in USD may be a more suitable option. Check with your credit card company to see if they actually charge currency conversion fees. If not, you’re in luck!
The decision of which benefits and Credit Card Company that you decide to give your business to is ultimately yours. Use these tips to best decide which credit card will suit your overall financial needs. There may even be a credit card that does not offer any foreign transaction fees but has other perks that would make you equally as happy.