How To Choose The Right Bank Before Going Overseas To Save Time And Avoid Fees

When budgeting for your next trip or vacation the focus is typically on the road ahead. Yet there are many expenses back home like bank fees that can add up and others like fraud protection that can be tough to do anything about when you’re out traveling the world. Before you set off on your next international trip be sure to check up on few key points with your bank and come up with your own financial protection strategy.

piggy bank

Start With What You’ve Got

You’ve mostly likely got a checking account with at least one bank so begin by finding out what they offer. You want to get these key points – which you can probably find online – but since you have easy access to a phone or the local branch, try calling or stopping by. Don’t waste your time hunting through legal jargon or confusing policies, talk to someone at the bank directly.

  • ATM Fees – They vary and you should find out the exact fees overseas. Some banks will also reimburse you for some of the fees you incur, be sure to ask.
  • Service (or Foreign Transaction) Charges – Creepy little fees that can appear on your statement when you use your debit or credit card abroad. There are a few accounts at various banks that don’t charge these so make this a part of your comparison shopping.
  • Transfer Fees – It’s not a good idea to travel with a single bank account on hand because if that account it compromised or locked by the bank (due to suspicious activity like being used overseas!) you could wind up in a heap of anxiety and trouble. There are plenty of banks that won’t charge for the first few hundred, or any transactions for that matter.
  • Time-Based Fees – Monthly, annual, or otherwise you don’t want time-based fees with your bank account.

Now you should have a pretty good idea of what you’re working with and what areas need improvement in terms of fees and charges for your simple travel budget.

Shop Around

on the lookoutIdeally you don’t want to pay any bank fees when you’re traveling so shop around. You might not be able to find a bank that reimburses you for all ATM fees, doesn’t have a foreign transaction charge, and allows unlimited transfers but you can mix and match.

  • Look Big – International banks give you more flexibility overseas and have arrangements with other banks that often mean less ATM fees.
  • Online Banks – Banks like ING Direct don’t have physical branches and all transactions are done online. While it’s tough to deposit a check it’s very easy to just about everything else through a web browser.
  • Earn Interest – ING Direct checking accounts earn a competitive interest rate as do their savings accounts. The same goes for HSBC, and with both banks transfers from your savings to checking are instant, which is good if you happen to go over budget. They also offer a small bonus (around $25) when your friends sign up.
  • Hours of Operation – Changing timezones (keep track with FoxClocks) and finding free wi-fi can make calling difficult, keep this in mind.

When you’re calling around, but sure to let the person on the phone know that you’ll be traveling and how much – especially if you’re taking an RTW. Get set up with two solid checking accounts in case one becomes unavailable for any reason and don’t keep all of your eggs money in one basket.

Plan Ahead – Test The Accounts

It’s frustrating to see a little fee appear that wasn’t supposed to when you’re at home, but it’s much more so when you’re traveling. Set up your accounts early and test them out with one or two transactions on your next international trip. It’s also a good idea to let the bank know ahead of time you’ll be traveling – they might decide to lock your account if the card is suddenly used in another country.

20 dollar  billsMake Your Money Work For You

Bank accounts can help you earn a bit of unconventional money for your travels.

What Services, Banks, Or Money Hacks Do You Use?

The biggest obstacle to choosing the right bank, or banks, for your travels is the hassle upfront of calling and digging through information about the fees, restrictions, and everything else. It’s a good idea to connect with other travelers to find out what they’ve learned and share some of your own favorite accounts and bank offerings. Leave your favorites and best advice in the comments below – what banks, credit cards, and financial services do you use?

[photos by: alancleaver_2000 (piggy bank), genvessel (woman on lookout) , AJU_Photography (20 dollar bills)]

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  1. Clark says:

    I highly recommend Charles Schwab. It refunds you for all ATM fees (worldwide!) and there are no foreign transaction fees. Plus, it’s interest bearing. Check it out.

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    • Anil P. says:

      Definitely will – was wondering how the brokerage account factors into it though, do you have to keep it active somehow or is just opening the account enough?

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      • Joel says:

        I haven’t had it long (about 2 months) but I’ve had no issue with keeping the Schwab ATM & checking without ever putting any money into my brokerage account. That could always change, but I haven’t heard of any issues like that.

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        • Anil P. says:

          Good to hear and know, thanks for sharing Joel.

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          • Akila says:

            We also have a Schwab account but I personally never use it. The problem is that they don’t have good online banking system so I can’t transfer funds in and out of my account easily. It’s a good account for short trips but if you need something that you can manage online when you are on the road for extended periods of time, I would not recommend it.

            I am with Earl – I use Capital One savings and credit card and think they are awesome.

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  2. Betsy says:

    USAA Federal Savings Bank is a good one. They have learnt how to handle all sorts of banking stuff as they originally started as a bank for military personnel overseas.
    They also offer different types of bank cards.
    Well worth the look into if you are traveling abroad.

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  3. marta says:

    we opened a Nationwide account which had a great deal on international ATM fees. Unfortunately somehow during the first weeks on our RTW trip we seems to have forgot or type the wrong pin and the card was then blocked since. It couldn’t simple be unlock on the phone and there are no overseas branch. So our advice is to have always a couple of cards as backup. we then used Barclays and HSBC; yet to figure it out the fees but it seems they are not cheap..ll let u know

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  4. ayngelina says:

    I’ll be the first to chime in on Canada. It was such a hassle to find a good bank for international banking, some of the managers knew as much as the Old Navy floor manager at the mall.

    A finally chose HSBC and Scotiabank for their presence internationally. HSBC is my primary bank (although at the moment having problems accessing it) and Scotiabank is my back-up as while it is international, in many countries they still charge a foreign transaction fee.

    Also, get email addresses of whoever sets the account up for you. You need someone to talk to that you actually met and is responsible for your account. I had initial problems with HSBC but the guy emailed back right away, remembering me, and assuring me that the issue was being looked into.

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  5. Earl says:

    I’ve also been using Capital One – both their credit card and direct banking savings account which comes with an ATM card and no international transaction fees. So far I haven’t had any issues (and you can even upload your favorite travel photo to be on the front of your credit card!).

    My Chase account had a 3% intl transaction fee but I just called them up one day and explained that I would take my money elsewhere because of their fees. The customer service rep put me on hold for a minute and when he returned, he informed me that I would no longer have any fees. And they even reimbursed my ATM fees from the prior month. So perhaps it doesn’t hurt to ask before shuffling your money to another account!

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    • Anil P. says:

      Thanks, awesome – I love it when fees magically disappear :) Telling them you’ll be taking your business elsewhere is a great bargaining tactic for both banks and other negotiations.

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  6. Joel says:

    What I’ve found for lowest fees for banking (for US based travelers):

    – Capital One offers the only major card (Visa) that doesn’t charge international transaction fees. Visa itself does, but Capital One doesn’t tack on another 3% which is the norm for the other bank’s cards I looked at.
    – Charles Schwab has a free checking account that provides you with an ATM card without international transaction fees. You have to sign up for a brokerage account, but you don’t have to use it. This is the only major bank I saw without ATM fees – there were a few others, but they weren’t banks I was willing to take a chance on.

    Based on what I could find, HSBC, Citi and Chase may have branches worldwide, but if you have a US based account, you still pay international fees to take money out overseas even from their ATMs.

    The one other banking tip I learned is that in some places you need a card with a smart chip in it (e.g. unmanned train stations or bike rentals in France). No US cards have that (other than AmEx which isn’t accepted widely there), so I’m planning to purchase a smart chip debit card when I arrive so I have it when I need it.

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    • Anil P. says:

      I didn’t know about the Charles Schwab account – great information, many thanks. The smart chip cards also come in very handy (especially in Europe).

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  7. A wonderful overview, Anil. I try not to use my credit card at all when traveling overseas, simply because of the onerous fees. I do call Citibank and give them my itinerary, just i case I do need to use it, and have had only one problem with it being blocked when I bought jewelry in Thailand (understandable), but a phone call cleared it up. Instead, I use my debit card with RBC (Canadian based bank with many US branches) and they have only a very small Association Markup fee.

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  8. Not a sexy post, but incredibly practical. Our travel is mostly US-based, with some travel in Canada. We’re currently using PNC Bank, which has its operations primarily in the East. But as we start traveling further West, I imagine we will be looking for banks with more branches/ATMs.

    I would be interested in hearing anyone’s experience with Bank of America. As an FYI, are banking needs are pretty simple. Most of our deposits are made via wire transfer or PayPal. Many of our bills are e-payments. We use cash very sparingly, putting as much as we can on credit cards and paying off the balance every month.

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    • Anil P. says:

      I’ve heard good things about PNC. I tend to keep close track of the fees and miscellaneous costs I incur on the road and the idea for this post was born out of that. I don’t like using cash either, I always feel like I spend more doing so but sometimes just a necessity to pay mostly with paper.

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  9. In the past, I have used ctibank and have not had a problem with fees while traveling in rural China. The only difficult part was going to a village for about a week that didn’t have an atm or cash machine. Be sure if you’re in this situation to budget the amount of cash you will need to live until you’re in a non rural area again. if you have the luxury of bringing along a phone or access to one do not be afraid to call the bank to check your account balance on the go. Have all of your numbers and emails available!

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    • federico says:

      I have had problems often with citibank, usually being that they block my card because of overseas travel. I had to give them a detailed itinerary or my trip to avoid further hassles. Once that was done no more problems.

      This said if you use the credit card at an atm fees are outrageous- this was learned the heard way. I suggest you look for another bank for your regular withdrawals. I am seriously considering opening an account at Charles Schwab because I had heard of this recently as well ( atm fews returned)

      Still, no matter where the money is banks always take a big chunk away…ugh!

      Federico
      maitravelsite.com

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      • Anil P. says:

        Thanks guys for your insights. A combination of the two seems to have some advantages – I’m curious about the Charles Schwab account myself. Good thing is that cash works in most cases, agree with OTP – always have an ample supply handy :)

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  10. David says:

    There’s a useful Wiki article by Flyertalk.com that gives a summary of considerations and fees incurred when using debit and credit cards in foreign countries. Especially noteworthy is the detailed “Schedule of Foreign Transaction Fees By Bank for Debit and Credit Cards”. Go to: http://flyerguide.com/wiki/index.php/Credit/Debit/ATM_Cards_and_Foreign_Exchange#The_List Hope it helps.

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    • Anil P. says:

      Hi David, thanks for the great info. Looks like a pretty comprehensive wiki on the subject and a great way to find new deals and narrow down all of the options.

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  11. Kim says:

    I’m still waiting for word on how the Frequent Flyer Master applies for people who DON’T live in the US or the UK. My guess is not really.

    A recent discussion on a travel forum seemed indicate that the surest way to get your card blocked when using overseas is to notify the bank beforehand. Granted, the experiences all seem to revolve around a particular bank (one of the largest in the US).

    Another suggestion is to set up as many autopayments as possible – insurance, credit cards etc – you may not be able to get to an internet connection in time and avoid late payment fees.

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    • Anil P. says:

      I’ll be doing a review in the coming weeks and let you know. I can tell you though that calling your bank beforehand will certainly help if you’re using ING or HSBC.

      Good call on the auto-payments, they can be a lifesaver and a really save on late payment fees.

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      • Anil P. says:

        Hi Kim, I asked Chris and while it is easier in the US/UK many of the promos don’t require credit cards from those countries. He’s had many happy customers outside of those countries and the ebook has a money-back guarantee as well.

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