How to Manage Your Money When You are Travelling

More and more people are visiting other countries for business or for pleasure. However, it is necessary to make proper arrangements to have sufficient amount of funds in the country where you are going. You can carry your money in three different ways while you are travelling such as cash, credit/debit cards and Travellers cheques. Each system has its own pros and cons.

The traditional way is to carry cash but it is prone to getting lost or stolen easily. However, you must have some local currency with you when you land so that you can take care of your immediate expenses and in case your cards get lost so that you can sustain yourself till alternate arrangements are made. Cash is also necessary as it is accepted by all vendors and merchants and it is more convenient in case it gets lost or stolen, because you will only lose the amount stolen, unlike in the case of cards. You can take foreign currency from your local bank.

The easiest way to handle your finances abroad is to carry a credit or debit card as all that you need to do is to hand over your card wherever you need to pay, swipe it and that’s all there is to it. However, many shops in less developed countries, especially the market stalls, may not have card readers. You need to make sure that the card is swiped in front of you so that the merchant does not clone it or swipe it twice. You can withdraw local currency by using debit cards at an ATM but you have to strike a balance between withdrawing large amounts of money in one go and saving transaction costs but being more prone to threat and withdrawing small amounts many times and paying hefty transaction fees. The danger in having these cards is that if they get lost or stolen, you have to be quick in informing the issuing banks so that they are not misused. Moreover, you can be left high and dry for some time.

The third option is to carry Travellers Cheques. You sign them when you buy from a bank before you leave your country. They can be cashed in foreign banks for cash or used at shops or restaurants to pay bills. This is the safest option because if they get lost or stolen, you can cancel them and get a refund or credit to your account, unlike in the case of cash and with difficulty in the case of cards. However, you have to pay a small fee on issue to the bank and another small fee when you exchange them for cash when abroad.

It would however be best to try and pay for your accommodation, travel and other expenses before you leave your country and carry all three options in moderate quantities for shopping or other expenses.

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