Using a credit card can be the safest and most effective way of carrying currency and buying things "on the economy" when stationed overseas. Banks now take extra precautions to avoid credit card fraud, so a sudden change in your charging patterns could cause the card issuer to flag your account or suspend transactions until they can be verified. To avoid that inconvenience and make sure your card is honored overseas, know how to use your credit cards wisely during your assignment.
- Credit is safest. You might think that an ATM card is the way to go, but thanks to added security measures such as purchase protection, credit cards are much safer. Most of the time you can use your credit card in an ATM if you need to, but charging purchases instead will save you money. If you can be disciplined with your record keeping and plan in advance, taking your credit card abroad will allow you to spend safely and without any hassles.
- Pick a universal card. Make sure your card will work in your "theater of operations." Stick to widely accepted credit types like Visa and MasterCard.
- Notify your issuer. If you are going somewhere out of your regular routine, notify your card issuer before you go. If your card company sees your card being used in places you don't normally go, they might suspend your account. Although this is something that you can normally resolve quickly, you'll save yourself the trouble if you just let your card issuer know before you go away that you'll be using your card abroad.
- Ask about fees. Before you depart, ask the card issuer what fees they charge you for using your card abroad. Common fees such as those for "foreign currency conversion" and "foreign transactions" can add three to four percent or more to each transaction! If you have more than one card, take the one with the best rates for withdrawing money and making transactions. Even if you get a better exchange rate with one card, you won't save money if your card issuer charges high fees for taking out foreign currency.
- Carry card issuer contact numbers. Before going abroad, get your card issuer's phone number for international calls and keep it with you so you can get assistance quickly if something goes wrong. Ask your card issuer about arrangements in case your card is lost or stolen.
- Keep all receipts. The most important thing to do when abroad is to keep all your receipts. If you are overcharged, you will need to be able to prove it. By keeping your receipts, you'll know exactly what you've purchased and how much you've spent.
For an informative info graphic about credit cards, visit Consumer Financial Protection Bureau Know Before You Owe: Credit Cards. For an overall introduction to creating a smart spending plan and avoiding the pitfalls of a steady paycheck, listen to the podcasts Taking Control of Your Cash and Avoiding Payday Loans.