How to Avoid Fees with Credit Cards Overseas

I am a huge believer in credit cards. Not to max them out or abuse them in any way (let’s be smart, people), but to take advantage of the bonuses, rewards, cashback, and other benefits.

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If you’re going to be spending the money, you might as well be earning something back while you’re at it, right? I currently use the Chase United Mileage Plus Explorer Visa, my go-to travel credit card, and the Chase Freedom Visa, my go-to card for everything else. The reasons are in the rewards, but that subject is for another day.

There are several cards that compete nicely with each other to earn a spot in your wallet, especially as you travel internationally. What I want to make clear today is one single point, one thing to look for when figuring out which credit card you should use when you travel abroad, one thing that is essential in a travel credit card:

Zero-percent foreign transaction fees.

This single benefit is one of the most important things you need to look into when choosing a travel credit card. Why? Because most credit cards will charge a 3% foreign transaction fee abroad. That means that no matter how much your purchase is, the credit card company will charge you 3% on top of that simply for being in a foreign country. This is unnecessary spending and can really add up quickly.

Related: Best Reward Credit Cards

If you aren’t sure if your credit cards charge you foreign transaction fees, then they probably do. It’s a benefit that most travel credit cards offer, and most others don’t. When I refer to travel credit cards, I’m talking about those that also give you miles, or are affiliated with a specific airline, not just cards that give you an extra percent back on travel purchases.

I recommend checking out the affiliated credit card with whatever airline you prefer to fly the most. For example, I generally fly United, so I have the United credit card, and that works well with my mileage plus account and mile-collecting to give me extra benefits when it all goes together. CAUTION: Those of you who prefer Delta may have a harder time with the American Express overseas, it is simply not accepted the way Visa and MasterCards are. I would advise you to get a Visa if at all possible (don’t even think about Discover).

Related: Getting the Most From Frequent Flyer Miles

no foreign transaction fees

If you need direction, compare some of these credit cards, and don’t be afraid to apply for one if you don’t have one yet. Just make sure they include 0% foreign transaction fees and some sort of rewards, usually in the form of miles. I would also recommend getting one that includes travel insurance.

Once you get one, use it as often as possible overseas. Whenever you can pay with a credit card, pay with this card. It is the best exchange you will get, without any kind of penalty, and it will save you money on ATM fees as well (paying with cash).

Related: 4 Easy Ways to Access Your Money Overseas

On that note, find out about the debit card that allows you to avoid ATM fees here.

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3 replies on “How to Avoid Fees with Credit Cards Overseas”

Apparently Fidelity has a no fee debit card. I just requested one (already had an account there). We’ll see. My current credit union debit card will charge 1% of the withdraw amount plus whatever fee the foreign ATM charges. Not too bad really. Its going to cost no matter what you do right?

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