Credit Cards and International Fees

Credit cards that don’t carry foreign transaction fees are generally the best option for spending while traveling internationally. But even if you’re stuck with a card that charges the fees, you can still save more by using the card rather than by exchanging cash at banks and airport terminals.

That was the conclusion of an analysis from Card, which compared the cost of currency exchange services from the major credit card networks with 15 large domestic banks and airport currency exchange outlets like Travelex.

Cards that don’t charge foreign exchange fees are the best bet. Card Hub says they’ll save you, on average, about 8 percent over exchanging cash at domestic banks, and 16 percent over airport exchange services. There are more cards now that come without the fees, like Chase’s Sapphire Preferred card and the Capital One Venture Rewards credit card. Roughly 82 percent of cards carry the fees, down from about 90 percent a year ago, CardHub said. Foreign transaction fees typically run from 1 to 3 percent. The average fee in the first three months of this year was 2.38 percent, the report found, down from 2.52 percent a year earlier.

Card Hub’s default list of “featured” no-fee cards may give higher placement to card issuers that pay advertising fees to the Web site. But users can make their own search by entering specific criteria, said CardHub’s founder, Odysseas Papadimitriou. The Web site NerdWallet is another source for information about cards with no foreign transaction fees.

Using cards that don’t charge the fees not only saves you money but avoids hassles, since the currency is converted automatically whenever you make a purchase, said Mr. Papadimitriou, a former card executive at Capital One.

Bill Hardekopf, chief executive of the Web site, said credit card companies are dropping the foreign fees on some cards in a bid to attract clients with solid credit, since those consumers tend to be more affluent and travel overseas. “They’re courting people with good to excellent credit more aggressively,” he said.

If you must use a card that still charges the fees, it will still save you nearly 6 percent relative to exchanging money at banks, and almost 14 percent compared with airport exchangers, the study found.

If you have to go with a bank, it pays to do some research. The best banks for currency conversion are Northern Trust and Harris Bank — the same as last year, the study found. The costliest are also the same: U.S. Bank and Fifth Third Bank. The fees that banks charge for currency conversion are, overall, unchanged from last year (Wells Fargo is an exception, according to CardHub, dropping its fee to $7 this year from $12 last year.)

On average, the analysis found, banks save consumers almost 10 percent over airport outlets like Travelex, which offer convenience but at a premium.

Mr. Papadimitriou advised consumers to avoid so-called dynamic currency conversion, which is what happens when a merchant asks you if you would like to have your purchase total converted on the spot into American dollars. Merchants generally use a high exchange rate and pocket a profit from the transaction, benefiting from tourists who don’t bother to check the math at the point of sale.

Are you planning foreign travel this summer? How are you planning to pay for purchases overseas?

Take Our Frequent Flier Quiz

Not an elite flier? You’re in the vast majority. Globally, only about 4.2 million out of some 320 million frequent fliers are elite; most of us are just hoarding miles in hopes of one day swapping them for a coach ticket. The multibillion-dollar airline-loyalty industry has been around for more than 30 years. How much do you know about it?

1. What was an early inspiration for frequent-flier programs?
a.) S & H Green Stamps, distributed at grocery stores and other retailers
b.) Toasters and other gifts doled out to bank customers
c.) Both a. and b.
2. What was the first mainstream mileage-based frequent-flier program?
a.) American AAdvantage
b.) United Mileage Plus
c.) Delta Frequent Flyer
3. How many frequent-flier programs are there today around the world?
a.) about 90
b.) about 140
c.) about 200
4. Between 1981 (when frequent-flier programs began in earnest) and the end of 2011, how many miles were awarded globally?
a.) 17.8 billion
b.) 930.5 billion
c.) 33.2 trillion
5. On average, what percentage of domestic tickets are purchased with points?
a.) 2 percent
b.) 6 percent
c.) 20 percent
6. What percentage of reward points and travel miles do Americans fail to redeem each year?
a.) 6.5 percent
b.) 10 percent
c.) 33.3 percent
7. What was the first airline to allow the transfer of frequent-flier points between same-sex couples?
a.) United Airlines (in 1999)
b.) Delta Air Lines (in 1993)
c.) American Airlines (in 1990)
8. What issues related to frequent-flier miles have been addressed by Congress?
a.) Whether they should be taxed
b.) Whether members of Congress should keep miles earned on business
c.) Both a. and b.
9. How many “mileage millionaires” are there?
a.) About 10,000
b.) 51,000
c.) More than 400,000
10. How many miles does the person with the most accumulated points have, and how were those miles accumulated?
a.) 70 million, through an airline program
b.) 20 million, through a credit card
c.) 120 million, through a credit card and a program.
Answers: 1. c. 2. a. 3. c. 4. c. 5. b. 6. c. 7. b. 8. c. 9. c. 10. c.

7 Ways Traveling Can Make You A Better Person

There is no better way to bring cultures together and to understand another person than traveling. Once you set foot in a foreign land and eat, drink and live like they do, many prejudices and misunderstandings are immediately dropped.

See if this applies to you – here are seven ways that travel has made me a better person:

#1: Better Communication
After living and traveling in numerous places where English wasn’t the first language, and I didn’t speak the local language particularly well or at all, my other communication skills had to improve. Spending time conversing across a language barrier means you learn not to assume someone’s meaning until they’ve got to the end of the sentence. And, even then, you might double check their meaning by asking them some questions before you assume anything negative. Becoming a better listener is also part of this learning curve. I’m sure I used to jump in half way through my friends’ sentences but now I’m more likely to sit back and let them finish talking first, which is a good start towards better communication.

#2: Accepting Differences
Dealing with people of many different nationalities, religions and all walks of life, as you tend to do when you travel through different foreign countries, means that you learn to respect all kinds of differences that back home would have concerned you. Before I taught Korean students, for example, I would have thought anyone who would contemplate eating dog meat was a terrible person! After all my travels and experiences I am much more accepting of the different habits and customs of the world’s cultures. This follows through to even simple differences of opinions with my friends back home, too. Now that I’m a parent, for example, the “old me” probably would have been extremely critical of different parenting styles – but the “traveler me” is much better at accepting that everyone will do it in their own way, and that’s okay.

#3: More Patience
Traveling teaches you patience and having more patience is definitely one way you can become a better friend. It’s made me more patient with friends who are late (even though I’m still a stickler for punctuality); it’s helped me be patient with friends who make decisions which I think aren’t for the best for them; and made me more patient with friends who can’t even get around to making decisions.

#4: Generosity & Help
I am definitely a more generous friend thanks to my traveling years. I met so many people on my travels who helped me without any expectation of getting something in return. My gratitude to them makes me want to help others in the same way. Before, I may have been selfish both with my time and money even when I saw friends in need. But now I’m much more likely to offer to help friends in various ways without giving a thought to what’s in it for me. Along the same lines, I am definitely better at sharing my material belongings as well. Traveling for long periods of time makes you get used to being without these possessions and they become less important – so I’m happy to loan more things out to friends and not worry about the idea that I might need them in the meantime.

 #5: Making Friends Easily
Not only has traveling helped me to become a better friend, it’s also helped me develop the skills to become friends with someone much more easily and quickly. When you meet someone traveling, it’s often clear that you may only spend a day or two or at most a few weeks or months with them, so your friendship tends to accelerate a lot more quickly than it would if you were back home and making a new friend through work or study, for example. These days I’m much more confident in asking lots of questions to get to know someone quickly (without giving them the third degree, of course!) and swapping contact details to make sure we can stay in touch (and actually staying in touch, too!). I may have been quite shy around new friends before but travel has stripped that all away and I can get to know people well much more quickly and easily.

#6: Making the Most of Time Together
For the same reason – making friendships abroad when we knew we would only be in the same physical location on a temporary basis – I’ve grown used to maximising the fun of spending time with friends, and making the most of the time we spend together, even if we do live in the same city and have no plans to move. Travel taught me that relationships with friends are an invaluable part of life that need to be cared for. I had previously just grown up with some good friends and never thought too hard about what I’d do if they weren’t there any more.

#7: Being Honest and Authentic
Last but not least, my experiences abroad taught me to be more honest about who I am and not to try to represent myself in a way that will make people like me more. Having those “fresh starts” in places where nobody knows anything about you is a good way to do this. And I am now perfectly happy to tell people honestly about my interests and beliefs without worrying what they’ll think. If they think I’m odd, then we’re not meant to be friends anyway and that’s okay! If you liked this post, subscribe to our full feed RSS. You can also subscribe by email and have new posts delivered directly to your inbox daily.