The Ultimate Guide to Travel Banking


Whether you’re planning on traveling long or short term, you are going to be dealing with money. I hear a lot of the same questions when people talk to me about planning their trip.

How much money should I bring? Should I bring cash? What about debit cards and ATMs? Is there an extra fee for using my credit card?

I’ve been traveling between the US and Mexico for the past six years, and have learned a lot about travel banking. I have come up with a system to handle my finances that has and continues to save me hundreds of dollars. If you’re looking for the best ways to cut fees, prevent fraud, and even invest while traveling, this guide is for you.

How to Get the Best Currency Exchange Rate

There are several ways you can change your money for local currency, and each method has a price. But before you try any of the methods listed below, be sure to check the current exchange rate online. The rate you find is the most you can expect to get for your money.

Learn the abbreviation of your home currency and the target currency you’d like to exchange for. When I want to exchange US Dollars for Mexican Pesos, I search the following: $1 USD to MXN.

When you’re ready to convert your money, there are a variety of options. The most common exchange methods are as follows:

Paying with your national currency

Some restaurants and convenience stores will allow you to pay US Dollars or Euros. This isn’t very common outside of touristy areas, so don’t expect to see this everywhere you visit. This is one of the worst exchange rates you can get. Generally, a convenience fee of 8-20% built-in when you pay your bill this way. You can do much better than this.

Currency exchange kiosks


You’ll find these at airports and in medium to large sized cities all over the world. Often advertised as “commission free”, the commission is part of their posted rate. This fee tends to be around 5-8%. Which means you’ll get 5-8% less than the exchange rate you found on Google. This is not a good rate.

Withdrawing local currency at ATMs


The rate you’ll get at an ATM is one of the best you’ll find. Usually this will be within 1% of what you can find online. The biggest downsides to using an ATM are the potential international, bank, and ATM fees. But, if you plan ahead, you can avoid them. Keep reading to find how to avoid these fees.

Exchange rate for Credit Cards

Credit cards are great for travel. They can provide consumer protection benefits, primary car rental insurance, and travel rewards. But they will give you the best exchange rate. I recently did a test to see the rate I was getting with my Chase card, and it was within 0.1% of the posted rate. Keep in mind that credit cards are not always accepted throughout Latin America. You’ll have better luck in larger cities.

Also be aware that American Express and Discover cards are not as widely accepted outside of the US. Just another reason why I use travel friendly Visa cards.

How to Avoid International Bank Fees

No one likes paying extra for no good reason. Before your trip, make sure you have a debit and credit card that doesn’t charge you unnecessary fees.

For my debit card, I use a Charles Schwab Bank Checking Account. I chose Schwab as my travel checking account for three main reasons:

  • No foreign transaction fees

  • Unlimited fee rebates from any ATM in the world

  • No account maintenance or minimum fees


It’s smart to travel with as little cash as possible, which means visiting the ATM more often. Even if you withdraw cash twice a week, this card will save you hundreds of dollars a year in bank fees. The customer service with Schwab is excellent. At the end of each month they’ll completely reimburse you for the ATM fees charged to your account.

There was only one thing I thought was strange when I signed up. You have to open a brokerage account with them when you sign up for a checking account, but it turned out to not be a big deal. You don’t have to use the brokerage account if you don’t want to. You'll still get all the benefits offered by their checking account.

You can apply for this account completely online. There's no need to visit a physical Charles Schwab branch. They’ll send you a debit card within a week of funding your account.

For European readers, I've heard that N26 based out of Germany is similar to Schwab when it comes to fees.

For credit cards, I use a Chase Sapphire Reserve, or Chase Ink card for business purchases. Both have excellent travel benefits beyond not charging a foreign transaction fee. The Chase Sapphire Preferred is another good option with a much lower annual fee.

Travel Rewards Credit Cards


There are dozens of travel credit cards to choose from. The one that’s right for you depends on your spending habits, and how often you travel. As long as you can pay off the balance every month, having a travel credit card can mean much more than free travel.

You read about how to avoid foreign transaction fees and getting the best exchange rate. But did you know that credit cards can help mitigate fraud, and even act as primary car insurance? Some cards will even refund you the application fee for TSA Precheck or Global Entry. I recommend Nerdwallet to help you find the best card for your needs.

Call Your Bank Before You Travel

Banks are trying to look out for their best interests as well as yours. That’s why most of them have developed sophisticated fraud protection algorithms. This helps make sure the purchases on your card were actually made by you. If your bank thinks you’re in New York, and a transaction suddenly shows up in Mexico City, they'll block your card. You'll need to contact them to verify that it was you who tried to make the purchase before using your card again.

Avoid this headache by notifying your bank ahead of time. Let them know where you plan to go and for how long. Some banks allow you to send travel notices online.

Keeping Your Money Safe From Fraud

Use multiple bank accounts

To keep my travel funds safe, I use three banks and three accounts:

  • General Savings Account,

  • Personal Checking Account,

  • Travel Checking Account.

Why three? Let me explain.

It doesn’t make sense to have the bulk of my savings sitting in a checking account gaining hardly any interest. I use Ally for my savings where I get a 1% interest rate, roughly ten times what I’d get in a regular checking account. Also, having my savings separate from other banks allows me to keep it safer. I don't travel with a card for this bank.

I use my personal checking account to pay my bills, and make transfers to my other accounts. For safety, I keep less than what I have in my savings in this account, but more than what’s in my travel checking. Since I don’t carry a debit card for this account while traveling, there's less risk of fraud.

My travel account is only tied to one other account to make electronic transfers quick and easy. This also protects the other remaining account. I never keep more than $600 in my travel checking account. Even in the unlikely event that I am forced to withdraw all the money in it, it wouldn’t mean the end of my travels.

Emergency Cash Stash


In case I ever find myself in a situation where I am unable to access my bank card or an ATM, I still keep some cash with me. A two week emergency stash gives me peace of mind. Two weeks should be plenty of time to get somewhere with an ATM, or have the bank mail out replacement cards. For traveling through Mexico, I like to keep an extra $300 USD set aside.

For extra safety, some of my travel shirts have a secret pocket sewn into them where I can stash my emergency fund. These also happen to be my favorite shirts to wear anyway as they're made out of a simple yet comfortable hemp and cotton blend. You can get them here.

Dummy Wallet

In particularly dangerous areas I carry a dummy wallet. This is the wallet I would hypothetically reach for if I were mugged. Thankfully that hasn't happened. But if it were to happen, hopefully a mugger wouldn't get away with much. I tend to keep $10-20 in my dummy wallet, along with a couple of expired credit cards. I keep it in my back pocket and my main wallet elsewhere. While there's no knowing what could happen in a dangerous situation with a mugger, I would theoretically first throw them this wallet, then run the other direction. Optimistically that would placate their need for more of my things while I make a speedy getaway.

Avoid the Dynamic Currency Conversion Fee (“Would you like to be charged in dollars or pesos?”)

This is a common scam that plays on the naivety of tourists. I’ve had a couple of vendors try this on me in Mexico. Once I was buying tickets to Xel-ha and a vendor asked me whether to charge my card in pesos or dollars. The question took me off guard. But then I thought about it: “Why would a Mexican company offer to charge me in dollars?” Of course they wouldn’t unless there was something in it for them. Banks already convert international purchases to your home currency.

How the scam works: When you request to pay in your home currency the vendor converts the currency for you. The conversion rate is usually terrible.

Always insist on being charged in the currency of the country you’re in should a vendor ask.

Digital Security While Traveling

Online Security 101:

Clearly, you don't want to get your banking information hacked. Create a unique password for every online account you have. Don't share your passwords with anyone. Passwords should be long and hard to guess. Password managers make this easy.

Save all your important information in a secure digital note like LastPass. This means passport and banking information in case of an emergency. This will make it easier to contact your bank or report your passport stolen. Make sure you turn on multi-factor authentication.

Use a VPN

While traveling, be sure to use a reliable Virtual Private Network (VPN) to encrypt your personal information while surfing the web. It's best to assume that any open Wi-Fi networks are unsafe, and using a VPN is a good way to protect your web browsing safe from prying eyes. You can read about even more reasons why you should use a VPN here.


Investing the Rest

Assuming you've read this far, congratulations. You are part of a small fraction of the world that has it so good you can entertain the idea of traveling the world. For those of you who can travel the world and have money left over, I recommend using Wealthfront.

I've been an entrepreneur for over a decade now, and I waited too long to learn about investing. There are swaths of books written on the subject, but I'd rather focus my time on what I'm passionate about. That's why I use Wealthfront, which has made investing super easy. They use proprietary algorithms to invest your money based on your adversity to risk. Use this link, you'll get your first $15,000 managed for free.


Life is too short to learn all lessons the hard way. I hope this guide saves you hundreds of dollars extends your travels. Let me know if I missed anything in the comments. What is your favorite travel card? Have you used any of the services mentioned in this post before? What was your experience with them?

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Jim Fricker II

Jim Fricker II is a gringo from Minnesota. In 2010 he decided he was no longer content with only being able to speak one language, so he set out to learn Spanish. As a result, he met his wife, May. As an added bonus, he never had to endure another Minnesota winter again.

    Over the years Jim has been a musician, recording studio owner, music producer, teacher, and technology enthusiast. He has produced dozens of albums for various unsigned artist, been commissioned to compose music for national organizations, and always tries to make sure he has his daily green smoothie in the morning.