Travel and Money: Using Your Debit Card on the Road


Your next vacation won’t happen without money…both prior to and during your trip. But with currency conversion discrepancies, high surcharges, and the risk of theft or loss, managing your money on the road isn’t as simple as you may think. This Travel and Money series discusses various ways to address your money issues while you are abroad.

Using your debit card is one of the best ways to access cash and pay for items while traveling. But it’s not an infallible tool; below are some things to be aware of and tips for using your debit card safely on the road while minimizing fees. (See also: 4 Ways to Beat Debit Card Fees)

Withdrawing Cash

No matter where in the world you travel to on vacation, you need cash on hand. But depending on the length of your trip and the country (or countries) you are traveling to, it is rare (and sometimes dangerous) for you to access and carry all the required cash with you from home. This is where your debit card can come in very handy.

Using your debit card at local bank machines often offers the most favorable rates and convenience factor. ATMs are almost everywhere, and where there isn’t an ATM, there’s usually a bank that can accept your ATM card as an instrument for withdrawing cash.

However it’s not as simple as pulling money out in $20 increments whenever you need it; here are a few things to think about:

Your Home Bank’s Fees

Unless you are visiting a branch of your home bank abroad, you’ll likely be tapping into the Plus or Interac system to use a different bank’s ATM or even a privately owned ATM. For this privilege, your bank will likely charge a fee per use of a foreign ATM.

Foreign ATM Fees

You’re not off the hook yet; the foreign ATM you are using (especially if it’s not associated with a major bank) will likely be charging a fee as well. This fee varies depending on where you are, but is usually the equivalent of a couple of dollars.

Currency Conversion Fees

Last but certainly not least, somebody’s going to make some money on the currency conversion factor as well, since you are inserting a debit card in your home currency and the machine is spitting out local currency. These fees are usually levied by your bank, and although they’re often lower than other currency conversion fees (which we’ll address later in this series), expect to be stung for up to a few cents on every dollar.

Paying With Your Debit Card

Electronic payment systems that allow you to use your debit card at the counter are becoming increasingly common, especially in western countries. This can negate the hassle and risk of carrying a lot of cash with you, and depending on the arrangement you have with your bank, it can also be quite inexpensive.

Withdrawal Fees

Some banks don’t charge at all for debit purchases, so it pays to look into the account you have with your bank. Even better: some vendors allow you to take cash out as part of the purchase, which is a way to negate the ATM fees listed above. However be sure to ask the vendor if they charge for taking cash out; sometimes they’ll charge a fee for the privilege of taking extra cash out as part of your purchase.

Currency Conversion Fees

You’ll still likely have to pay the same currency conversion fees as you would by making withdrawals through an ATM. Keep in mind that if you are traveling through a country (or coming from a country) with a highly fluctuating currency, you’ll be at the mercy of the daily conversion rates as well — for better or for worse.

Safe Use of Your Debit Card

No money management technique while traveling is infallible. The best you can do is to manage the risks and remain alert to problems or dangerous situations. Here are some tips:

Limit Your Bank Account Balance

If somebody gets a hold of your debit card and PIN number, all the money in your account is at risk of being stolen with little to no recourse in recovering it. So limit the amount of money you keep in your bank account to a reasonable amount (I tend to maintain a balance that covers any automatic debits and prevents me from paying a monthly bank fee). You can keep the rest in a high-interest savings account, and if you need more money while traveling, you can go online and transfer it over to your bank account.

Protect Your PIN

This may seem like old news, but people are still shocked when they realize somebody looked over their shoulder and scooped their PIN number (and then scooped their debit card a few minutes later). Don’t feel silly about covering up your PIN number as you enter it, either at the ATM or cashier.

Keep Your Bank’s Contact Information Handy

Just in case there’s a discrepancy or emergency, have your bank’s contact information handy so you can get in touch with them from the road. If your debit card is stolen for example, you can call your bank and they can freeze the account or possibly help you recover lost funds.

Watch Your Account

Consider signing up for online banking (if you haven’t already) and periodically check the transactions on your account to ensure all is well. Again the sooner you spot a problem and alert your bank, the better the chances are you won’t be out of pocket for fraud or theft.

Withdraw Cash in Lots, But Not Too Much

To keep ATM fees low, you will want to withdraw more cash than you immediately need. But beware of carrying too much cash on you, as the risk of theft is ever-present. Later in this series we will discuss techniques for carrying cash safely while you travel as well.

Other articles in the Travel & Money series:

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Guest's picture

Wow! What a great Post! Very imformative! My learned lesson of the Day was about the curency conversion fees using the debit account. Thanks for the information!

Daniel A

Guest's picture

there is one more thing that can help the above ...
a separate travel account, most banks will allow you to have a second account for free if you meet the requirements for the primary account(ie direct deposit)

i leave my primary account debit card at home and put about $500 in to the secondary account. When i need more i transfer $ via my mobile web on my phone ..

This proved it self last year. My card was skimmed at an atm in france. they got both the # and pin and emptied out the $500 balance my account in 25 hrs i started getting over draft notices after 48 hrs .. if it had been my primary it would have been days before i would have know .. (i got it all back btw)

Nora Dunn's picture

@Guest - I think your suggestion is a great idea. In the article I suggest limiting the balance in your bank account and keeping the majority of your funds in a high-interest savings account (which earns you more money as well), but both strategies work. There's something to be said for not compromising your primary bank account by instead having a dedicated travel bank account/debit card.

Guest's picture

Alos, check with your bank to see if your debit card is a smart card, the kind uou 'wave' instead of swiping. The info on the magnetic strip can be 'stolen' by an electronic pickpocket with a common RFID reader.

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