Are you travelling soon? Read these travel tips when you are abroad so you don’t make these costly mistakes when you are travelling. 

When you forget to inform your bank

Before you travel abroad, make sure you inform your credit card issuing bank. This is because banks are becoming vigilant about preventing fraud, and as such, they may freeze your account, or even reject payment when they spot unusual foreign activity. So if you want to avoid the embarrassment and inconvenience of your credit card being declined when making payment while abroad. 

Not taking advantage of the right credit cards

Take advantage of using your credit cards when travelling. This is even more so if you have a cashback or airmiles credit card, because you are rewarded even more for every overseas purchase that you make. With cashback cards you will receive a percentage of each purchase back whether it’s paying for your hotel or dining overseas. While with airmiles cards, you will earn hotel points or airline miles every time you spend (locally or overseas).  

Not using the right mobile data

Don’t under estimate the data charges while you are roaming, which is often charged on a pay-as-you-use model. The smart way to handle your mobile data usage is to subscribe to international data roaming from your mobile provider. Otherwise, you can purchase a local prepaid SIM at your holiday destination, and internet access will be a lot cheaper that way. 

Changing currency at the last minute

Don’t leave changing currency for your holiday to the last minute. Yes, you can go to the money changer at the airport, BUT the exchange rates they offer are often lousy, and you will not be able to get the best deal. Aside from that, don’t be fooled by the 0% commission rate. Even though money changer is marketing the no commission rate, this does not mean that they offer the best exchange rate. You should always look at the exchange rate, and then compare between money exchange outlets. 

Not understanding banking fees

This is another travel mistake often made by travelers. When using your credit card while abroad, you may incur foreign transaction fees which can cost your holiday to become very expensive. Some cards charge an average 3%-4% fee on each transaction. 

Make sure you use a credit card designed for overseas use and one which does not charge currency conversion fees. With dynamic currency conversion (DCC), exchange rate that is given by the retailer is often less favourable than exchange rate given by your card provider. This is because it will usually include a profit margin for the store. Your credit card issuing bank will also charge you between 1%-3% foreign transaction fees on the purchase. The smart option is to pay in the local currency of the country you are at, and take up the foreign transaction fee when paying for purchases with credit card while abroad.