5 Credit Card Woes that Can Ruin Your Vacation
Planning a summer vacation? Make sure you make a phone call to your credit card companies before you go, says Ben Woolsey, director of consumer research for CreditCards.com.
If you start charging it up in an unfamiliar city without making that call, you're likely to trigger your credit card company's fraud warning system, which could render your credit cards unusable. And dickering with a credit card company over a charge rejection when you're at a hotel or restaurant is probably not the happy, restful memory you had in mind when planning your summer holiday.
Capital One, for example, told me moments ago that if I tried to charge something in Europe, they'd immediately assume it was a fraudulent charge and freeze my account. But one phone call -- or even registering your vacation on their customer service web site -- heads off the problem.
Calling ahead -- particularly when you're going overseas -- is Woolsey's top tip to avoid 5 vacation-ruining credit card problems. The other four?
No chip, no European trip: Many merchants in Europe have moved to microchip technology, rather than the magnetic strips that are far more common in the U.S. Travelers are most likely to confront bedeviling issues with chip-and-pin technology at unattended kiosks -- the type you might find at an airport or train station, according to BankRate.com. To avoid problems, Woolsey suggests you consider prepaying whenever possible and carry at least a couple of different credit cards to make sure that at least one will be accepted.
Another option: Get a Chip-and-Pin Cash Passport from Travelex. Travelex doesn't charge fees to buy or use the card. They make their money on currency transactions. (Some banks, though, will charge you to use their ATMs, if you use the card to get cash.) Another potential benefit of the card: It's loaded with the foreign currency of your choice -- Euros or British pounds -- at the time of purchase. If you buy when exchange rates are favorable, you maintain that advantage while you're in Europe -- no matter what happens to the dollar.
Painful International transaction fees: Also make sure you know what your credit card company charges for international transactions. Most credit card companies charge fees ranging from 1% to 5% when traveling abroad. If you spend $5,000 on a card that charges 3%, you get nicked for $150 -- and you get nothing extra for that fee. Favor the card that doesn't charge or that charges the least. Capital One informed me that there would be no charge for international transactions; American Express, on the other hand, told me I'd get hit with a 2.7% charge every time I used their card. The fees are disclosed. Look for them before you charge.
Stolen cards: Crooks are opportunistic and there's few better opportunities to steal your wallet and credit cards than at a foreign airport or taxi station, where you're likely to be disoriented and distracted. Woolsey suggests using a money belt, which can hold your cash and credit cards close to your flesh, making it more likely that you'd notice even the lightest-fingered pick-pocket. If you don't want to bother, at least write down the account numbers and phone numbers of your credit card companies and keep them in a safe -- and separate place -- just in case.
Paying for free help: When you call your credit card companies to tell them about your trip, also make sure to ask about their global assistance programs. These programs can do everything from replacing lost cards overnight to finding you a doctor in the middle of a foreign land. The phone numbers for each card company's global assistance programs are listed separately on the back of your credit card and they're worth writing down. Even though it's unlikely that you're going to get sick or have an emergency need for cash, it's nice to know that if you do, there's help available. And it's free -- just one of the perks provided by your credit card.
Kathy Kristof is the author of Investing 101
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