The typical family spends anywhere from $800 to $2,000 on their summertime getaways. If a family’s vacation plans involve foreign travel, they must also account for unexpected fees. Fortunately, our comprehensive guide can help keep you safe from these hidden costs.
Even before families set foot in their vacation destination, their bank balances have usually already taken a hit. Flight and lodging expenses are often the bulk of the vacation costs. The exact amounts will depend on whether you’re traveling outside the country or opting for a staycation. Travel expenses can consume up to 44% of a family’s vacation budget. After travel, entertainment and food represent the heaviest expenses. For example, a day at a theme park can easily set a family back more than $500. When news broke of Disneyland hiking their prices in 2018, the furore was palpable. Most families opt to cover these expenses using their cards, inadvertently adding to the cost.
For those not in the know, using a card abroad can quickly lead to a quagmire of fees. These charges become applicable every time you purchase something or withdraw cash. Our research shows that some card providers slap a fee as high as $13 on a mere $200 withdrawal abroad. UK-based families can expect a £9.50 fee on every £200 they withdraw abroad. And that’s not even considering currency fees. The hidden commission fees charged by banks typically fall between 2.75%-2.99%.
When using cards to buy something abroad, goods like a simple $20 souvenir t-shirt end up costing more due to currency fees of 2.75%-2.99% and ‘purchase fees’ ranging from $1.00 to $3.00.
However, fear not, we’ve got some tips to help you sidestep hidden card fees abroad.
Safety is the primary reason people use cards abroad. Tourist hotspots like Barcelona, London, New York, and Rome are famous for pickpocketing incidents. It’s not wise to carry a significant amount of cash or valuables. That said, there are alternatives to card payments that can protect you from hidden fees.
Booking your entertainment online can save you from foreign transaction fees. Theme park and cinema tickets, among others, can be purchased on the internet. It’s advisable to book tickets before your trip to save on entrance costs. With digital payment methods like iDebit, you can completely circumvent cards. To use services like these, all you need is online banking. Payments are made and authorized via online banking without the need for a card or card number. Besides, purchasing tickets online allows you to skip long queues, something families with children will appreciate. This is also a great way to take advantage of deals and discounted prices.
Using prepaid cards while on vacation can help you avoid hidden costs. Unlike standard debit and credit cards, prepaid cards aren’t linked to your bank account, thereby preventing overspending. They only permit spending of the amount loaded onto them. Another benefit of many prepaid cards is their multi-currency feature, which is great for avoiding exorbitant currency exchange fees while traveling.
For instance, let’s say an American family has loaded $1200 onto a prepaid card. They will be traveling to Italy, which uses the Euro (€). With a multi-currency prepaid card, they can convert the $1200 into Euros without worrying about hidden costs, and most prepaid cards do not charge for foreign ATM withdrawals.
