A question every traveller asks is whats the best way to travel with money overseas? In particular, which is more safe and what will incur less fees. This applies whether you are an experienced holiday maker or a travelling novice.
So let’s look at the pros and cons of all the different ways to travel with money.
Cash
It's the simplest way to travel with money. Just place all the cash you want to spend for the holiday into your purse/wallet. But this can prove to be the most riskiest way too.
Pros
Cons
So what I recommend, and do myself, is carry about AU$100 worth of the destination currency before I arrive. Sometimes airport money changers may not exist or have restricted opening hours.
Plus I carry about AU$300 in Australian cash, just in case ATMs close down for some reason. This habit has stemmed from when I was travelling in Argentina in 2002. The government closed down all banks due to a financial crises. I was so thankful that I had USD100 cash hidden in my walking shoes to enable me to buy a bus ticket back into Chile where I could withdraw money from their ATMs.
Credit Cards
My favourite and most preferred way to travel with money is with credit cards. Main reason being is that I can collect frequent flyer points/air miles on all purchases made. It helps me fly free once a year! I’m aware that not all banks offer such a benefit but it is quite common with Australian banks.
Pros
Cons
Some handy pointers I would like to share with you.
- Use cash with your own money and not the banks credit. If you plan to withdraw cash from your credit card, ensure that you transfer YOUR money into the credit card account so that it has credit balance. You will avoid paying interest charges by withdrawing your OWN money instead of the BANKS money.
- Check with your bank on their overseas ATM withdrawal fee. For Australian banks, this can range from AU$2.00 - $5.00 per transaction.
Often you will find this fee is not as bad as it looks. Converting cash at money changers can sometimes charge commission of up to 10% (it was 19% in Rome in 2017). If I withdraw AU$500 cash from my own money in the credit card, I will be charged a $5.00 overseas withdrawal fee, which equates to 1%. Then I add my banks 3% foreign transaction fee, to give me a total of 4% in fees. For this reason, I’m always happy to withdraw $400-$500 worth of local currency at a time. - Check if your bank offers free ATM withdrawals from international banks that are a part of their global alliance network. For example, I was able to withdraw cash for free at Barclays Bank in London and Bank of America in USA.
- Always use ATMs that are attached to a bank or located inside the bank.
Travelgroove Tip: In Europe, don’t use the Euronet ATMs that sit randomly in kiosks, shops and sometimes in a building right next to a bank. These ATMs don’t belong to a bank and therefore will charge you extra hidden fees. - Amex cards restrictions. I don’t travel with American Express simply because there are lot of businesses that don’t accept those cards. Therefore I don’t want the hassle of travelling with two credit cards.
- Let your bank know. Always let your credit card bank know your dates of travel and destinations so they can monitor the security of your account while you’re travelling.
Finding International ATMs
To be able to withdraw cash from virtually any country in the world, ensure your credit card is linked to either PLUS, Cirrus or Maestro networks. Just check the back of your credit card. Each of these networks has more than a million ATMs.
Before you leave home, you can check the availability of ATMs at your destination on the following online locators:
Visacards – PLUS ATM locator
MasterCards – Cirrus/Maestro locator
Alternatively, you can look for the following logos on the actual ATM machines.

Visa and MasterCard logos highlighted in an extensive range of ATM logos.
Debit Card
Sometimes banks offer Debit Cards connected to Visa or MasterCard as an alternative to credit cards. It acts the same as a credit card but you are using your own money to withdraw cash or make purchases domestically or overseas. It must be attached to a savings account so you can easily transfer money between the accounts.
The pros and cons are the same as for credit cards but with the additional points below:
Pros
Cons
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Travel Money Card

{For this section I will only refer to travel cards that are available in Australia – as that’s where I live and therefore is easier for me to research.}
Travel money cards operate in a similar way to a debit card. The only difference being is that you can pre-load with your own cash in multiple currencies. You can still withdraw cash from ATMs and make purchases like a credit/debit card. It is the same as using a debit card in that you are not using credit, meaning the banks money! Think of them simply as pre-paid cards.
Travel money cards can be issued by a bank, post office, airline or other currency providers, such as Travelex. They are re-loadable prepaid Visa or MasterCard cards. Therefore, you can use the same ATM locator links in the Credit Card section above, to check if ATMs exist at your destination.
Pros
Cons
Are Travel Money Cards really fee-free?
There could possibly be one more disadvantage to using travel money cards. It is a theory only at this stage. The fact that travel money cards don’t charge fees ( load/reload fees, foreign exchange fees etc) it makes me wonder how else do they recoup their expenses. One way I can think of is that the exchange rate is lower than the exchange rate used for credit cards.
There is no way of knowing for sure without further investigative research. I contacted my bank and was advised that they can’t tell me what exchange rate is used for credit card transactions because it is determined by Visa/MasterCard/Amex at the time of transaction. The bank has no control over the rates used, nor do they see the conversion rates. I guess, how does one access wholesale exchange rates by large interbank exchanges! However, for travel money cards, most banks display the rates on their website because you need to know the rates before you lock it in.
My scepticism on exchange rates was reinforced when I was reading the T&C’s of Qantas Cash travel money card. Even though they state there is “no currency conversion fee”, however further down the fine print I read that a margin is added to exchange rates. Therefore we’re not getting the best exchange rate for our money.

Investigating further
I’m continuing with my investigations. However, if the exchange rates are the same for both credit cards and travel money cards, then it makes sense to use a travel money card, but only if the following is satisfied:
- They have free ATM withdrawals with global alliance banks.
- These global alliance ATMs exist in the countries and cities you will be visiting.
- You will only be using any of the major 11 currencies they offer on the travel money card.
- When pre-loading foreign currency, you manage to lock in at the best exchange rate for maximum spending power!
Remember, be sure to read all the Terms & Conditions of the travel money card before you sign up.
One final note, during my investigations of the T&Cs of the various travel money cards, I noticed that the banks travel money cards had less fees and rules when compared to other providers such as other currency providers, post office and airlines.
Travellers Cheques
Travellers cheques were useful in the days when ATMs and credit cards were not yet popular and were not accepted everywhere.
I have not seen travellers cheques for years, decades even. But can you believe they still exist!
Pros
Cons
If you still want to use travellers cheques, best bet is to use globally recognised brands like American Express or Visa.
Conclusion - So what is the best way to travel with money?
So many options, what to do? In my opinion, the best way is with a combination of three, as suggested below:
- Convert about AU$100 worth of local currency cash before you leave.
Saves the hassle of looking for money changers at the airport while lugging your bags. Also they may be closed if you have a late arrival. The exchange rates are usually lower at the airport than in city centres.
Plus it makes life easier to pay for small incidentals upon arrival – food, drinks, taxi etc. - Optional: Bring about AU$300 cash (or your local currency) and store in a safe, secure area in your luggage. This is a backup plan in the event you are left stranded without access to credit/debit money, such as bank closures, no ATMs at destination, card eaten by ATM machine etc.
- Choose either a credit card or travel money card, based on what is more important to you as per the reasons discussed above. There is no easy answer because each provider has different fees and rules. Use the comparison table below to give you a quick overview of the differences between each type of card.
Credit/Debit Card | Travel Money Card | |
---|---|---|
Debit or credit money | Credit Card – deposit cash into account and only use your own money and/or use credit limit (banks money). Debit card – use your own money only (your cash is linked to a savings account). | Pre-load with your own money only – Australian dollars and up to 10 major foreign currencies. |
Exchange rate locking | Exchange rate used fluctuates daily. Therefore you end up averaging the exchange rate used over the duration of your holiday. | You can pre-load and lock in the exchange rate when it suits you – eg. In times of favourable exchange rates. However, you could also be locking in at a lower rate should the exchange rate improve while you’re on holidays. |
Exchange rates used | Conversions are based on wholesale exchange rates reserved for large interbank exchanges. (in my recent experience, the credit card exchange rate was always better than what was being offered locally) | Conversions by a set travel money card exchange rate (which the rate could be better, same or worse than with credit cards – more research is required). Banks & other travel money card providers websites usually list the daily exchange rate for travel money cards so you can lock in during times of favourable exchange rates. |
Overseas ATM withdrawal fees | Some banks have global alliance partners for free overseas ATM withdrawals. Otherwise, there is a set fee (in AUD) applicable to all countries and when using non-alliance banks. | Some banks and travel money card providers have global alliance partners for free overseas ATM withdrawals. Otherwise, there is a set ATM fee for each supported currency when using non-alliance banks. |
Foreign exchange fees. | Charge a 3% foreign exchange fee on the total value of ALL purchases and withdrawals. | Don’t charge a foreign exchange fee, when you purchase or withdraw from their 10 supported currencies that you have stored. For other currencies & cross currency exchanges you will be charged between 3 to 5.95% fee – depending upon which travel money card provider you use. |
Other fees you may want to check with your bank or travel money card provider | Initial and reload fees Card issue fee Card replacement fee Emergency cash Transfer fees Online servicing fees Telephone support fees ATM balance enquiry fees (via ATM, not online) Statement fees SMS alert fees Monthly inactivity fee | |
Collecting reward points | If you have an credit card attached to airline reward points – you can still collect airline frequent flyer points on overseas purchases. But not cash withdrawals. | No opportunity to collect airline reward points, except if you use the airlines own travel money cards – eg. Qantas Cash and Velocity Global Wallet. |
At the end of the day, there may be not much difference between the two. Credit cards may have better exchange rates but travel money cards offer free foreign exchange fees on 10 major currencies. The benefit of one may offset the cost of the other and so they become almost even in the end!
As mentioned before, credit card is my preferred because I like accumulating airline frequent flyer points but I am also disciplined with my spending. I always transfer my spending cash into the credit card before I depart.
What is your favourite way to travel with money? Let us know in the comments below your experiences, good or bad, with using travel money cards or debit cards and help other travel groovers!
If your credit card or luggage is lost or stolen, read some handy tips in the Travel EmergencyTips page.
Thanks Lisa.
You’re welcome!