Stress Less at the ATM
The last thing any traveler wants to worry about is a stressful encounter at an ATM. Not only are you trying to ensure you are physically safe when taking out cash in a public space, but also that your personal information is secure and that your card is not swallowed by the machine.
On top of all that, you often find yourself worrying about what ATM will actually accept your card and how many fees you will incur for the sheer act of accessing your own money. These are the remedies I’ve found that have significantly eased the stress associated with withdrawing my money in foreign countries:
Betterment Checking
Betterment is a robo-advisor and best known for their automated technology in low-cost, expert-built portfolios. While I do like them as a robo-advisor for investing accounts, I’m here to highlight Betterment Checking (read more on their website) which has NO FEES. All ATM fees and foreign fees are automatically reimbursed, plus no overdraft fees. I use Betterment Checking and the corresponding ATM card whenever I’m traveling and I’ve not had an issue yet. In my opinion, the main issues are you cannot deposit cash and you have to open an investing account to have access to a checking account. However, the minimum to start investing is only $10 and likely worth considering for frequent travelers. I recommend getting Betterment Checking for traveling as a supplement to your existing checking account.
Note: this is not a paid review of Betterment and my opinions are my own.
ATM Withdrawals: to accept or not accept conversion?
The first time you see a foreign ATM ask if you want to “Accept Conversion” or “Decline Conversion” can be a perplexing experience. Foreign ATMs can offer foreign card holders these two options while withdrawing cash. This practice is commonly known as dynamic currency conversion (DCC). Forbes notes, “Dynamic currency conversion allows customers to pay for a product or service in a foreign country using their home currency instead of the local currency. It involves a type of currency conversion fee similar to other fees credit cards or ATM cards may charge for converting purchases or cash withdrawals in a foreign country to your home currency”.
In short, the general rule of thumb is to “Decline Conversion” because DCC can result in a more expensive exchange than charging your credit card in the local currency.
Note, this is also true when paying for something with your credit card at a restaurant, store, etc. You may be given the option to pay in your home currency or local currency, and you can avoid a more expensive exchange by paying in the local currency.
Utilizing credit cards at the ATM (only if necessary)
You may find yourself in a situation where you cannot use your normal ATM card to withdraw cash. Perhaps you lost your card, it expired while on your trip, or your personal information was compromised. If you are in a part of the world that operates heavily on cash, then you need to find a solution quickly to purchase basic necessities like food and water.
Luckily, you may already have a solution in your pocket: your credit card. Per Forbes, “Most credit card lenders offer cardholders the ability to take out cash using an ATM. This is called a cash advance, and it comes with some major downsides and hefty fees. Cardholders can use a credit card at nearly any ATM and withdraw cash as they would when using a debit card, but instead of drawing from a bank account, the cash withdrawal shows up as a charge on a credit card. Forbes Advisor does not recommend using a credit card for a cash advance”.
There are also logistical hurdles to consider for this:
Accessing your credit card’s PIN. You will need the PIN to withdraw cash at the ATM. When I checked for American Express, I found that you can access your PIN online and change it immediately (ideal for travelers). When I checked for Chase, I found that you need to request the PIN and wait for it to arrive at your home address in the mail (which makes no sense for travelers who are in a foreign country and need cash immediately). The clear winner between the two is Amex.
Finding an ATM that accepts your credit card. You will need to look up the “ATM locator” for your card. I found that by logging into my credit card portals and typing “ATM locator” into the search bar. You can then search by location to find an ATM near you.
Naturally, you should do your due diligence in advance and only use your credit cards at the ATM as a last resort.