To decide whether you should get a credit card or debit card for international travel, it's important to consider aspects like fraud protection and costs associated with purchases and cash withdrawals.
All major-issuer credit cards and debit cards come with $0 liability guarantees, meaning you won’t be held liable for any unauthorized charges. However, credit cards do make fraud easier to deal with.
Yes, using a credit card internationally is the best way to go about paying for things when you’re abroad. It’s safer because you don’t have to carry as much cash, and all major credit card companies offer $0 fraud liability guarantees. Using a credit card internationally also gets you the … read full answerbest currency exchange rates, and it’s a great opportunity to earn rewards.
Here are some tips for using a credit card internationally:
Full protection from unauthorized charges: Credit cards allow you to minimize the amount of cash you carry abroad and provide the opportunity to earn rewards. They also come with $0 fraud liability.
Avoid foreign transaction fees: Many credit cards come with foreign transaction fees when you buy from internationally-based merchants. These fees are typically 1%-3% of the purchase amount. If you go abroad, you should get a card with no foreign transaction fee.
Set travel alerts: Many credit card companies ask that you set a “travel alert” before leaving the country. It’s not mandatory. But if you don’t, they might suspect that international purchases are fraud and suspend your spending privileges until you notify them otherwise.
Wider acceptance and more protection with chip cards: You’ll have a smoother experience using a credit card internationally if it’s a “chip” card. Many unmanned payment terminals abroad will not take cards that have only a magnetic stripe. And merchants may even give you a hard time if your card doesn’t have a chip.
Refuse Dynamic Currency Conversion: Choose to pay in the local currency. Merchants may offer to let you pay in U.S. dollars, a practice known as Dynamic Currency Conversion. But it’s often an excuse to use an unfair exchange rate (often as much as 7% higher) and overcharge you.
Avoid cash advances: Credit card cash advances allow you to get cash from your card’s credit line. However, cash advances are subject to hefty fees and interest rates that accrue immediately, with no grace period. So it’s best to avoid them outside of emergency use.
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