What are the best ways to spend money overseas?

Whether for a bit of sun, a city break or a fantastic adventure, Aussies are dusting off their passports and travelling again.

Spending overseas can be expensive, so it’s important to research carefully and look for the best spending options.

Many travellers end up paying exorbitant transaction fees and get poor exchange rates throughout their trip because they put travel money at the bottom of their checklist.

Read on to find different options to spend money while you're travelling.

Before we continue, a quick word.

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Here are a few reasons why travellers are using Yondr as their travel money card:

• Create your free virtual travel card in a few minutes.
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• Pay in over 180 countries with automatic currency conversions.
• Enjoy our bank-beating exchange rates.
• Safe & secure payments with Apple or Google Pay.
• Withdraw local currency at any Visa ATM, worldwide.

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What are the different ways to spend money abroad?

Here’s a look at your options so you can decide which is right for you…

Travel Money Card

Instead of carrying wads of cash, you can load money onto your travel money card and use it like a regular debit card when travelling. Some cards will automatically convert to the local currency when you pay or give you the option to withdraw local cash at an ATM for a fixed cost.​​

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Benefits:

• Travel cards are more secure than cash.
• You can top up through a mobile app.
• Some travel cards can support multiple currencies.
• You can often get a better exchange rate than general debit or credit cards and sometimes even better than local exchange booths.

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Considerations:

• You might miss out if the exchange rates improve
• Not all merchants accept card payments

Carry cash

It doesn’t matter what country you go to, it’s always convenient to carry some cash. It’s likely that your destination airport will have plenty of currency exchange options too, so you can always use one of those. Virtually everywhere accepts cash and having a little cash handy is good for things like tipping, taxis, markets and smaller shops and restaurants.

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Benefits:

• Cash is great to have when you're visiting smaller towns or remote regions.
• You can often get a better exchange rate than general debit or credit cards.
• Cash is accepted almost everywhere.

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Considerations:

• Cash can pose a safety risk, especially if you’re carrying lots of it.
• There’s almost no way to recover your cash if it’s stolen.
• Cash can be easily lost.
• If you run out, it’s gone - there's no line of credit for emergencies.

Using your debit card

You can just take your everyday spending debit card overseas while you travel. This allows you to access your own funds which can help to  curb spending and keep your budget in check.

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Benefits:

• You can just take your everyday transaction card with you overseas.
• It’s a secure way to travel without carrying a lot of cash.
• Withdraw cash from the ATM whenever you need.

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Considerations:

• Some banks charge 3-4% for international transaction fees.
• Some banks have a significant markup from the base exchange rate.
• There may be other hidden fees such as conversion fees for spending a foreign currency.
• Not all merchants accept card payments.

Travel credit cards

Specialised credit cards can be used in most countries where card payments are accepted and give you a longer period of time to pay back what you’ve spent, but have high interest rates. The main advantage of travel credit cards is the reward points you get as a signup bonus and other perks such as lounge access passes.

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Benefits:

• It’s a secure way to travel without carrying a lot of cash.
• Great for emergencies when you need access to large amounts of money.
• Dedicated travel credit cards provide lounge access or points.
• They are more secure - banks usually cover unauthorised payments.

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Considerations:

• Some travel credit cards have expensive annual fees and high-interest rates.
• Some cards have a significant markup from the base exchange rate.
• There could be high costs on international transactions and conversion fees.
• It’s hard to keep track of your expenses - you could go over budget.
• Not all merchants accept card payments

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Depending on your circumstances, these four methods to access and spend money abroad are great options, giving you the least hassle and the best bang for your buck.

But don’t put all your eggs in one basket, consider splitting your payment options in several ways to give you the most flexibility and security while travelling.

This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Yondr Money. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.