While traveling this summer, use credit cards with care
05/16/2014 9:07 PM
06/03/2014 10:17 AM
It’s May. The school year is winding down and summer travel plans are revving up. Whether it’s a road trip on the nation’s freeways or a jet flight across the world, chances are you’ll be using a credit card on those travels.
Before you depart, here’s a roundup of some good-to-know credit card travel tips.
Call before you go: Especially if you’re traveling overseas, it’s always wise to alert your credit card company. Otherwise, if you leave Kansas City and start charging purchases in Canada, your credit card company will probably flag those transactions as suspicious. They might try contacting you by phone to verify the transactions. Or they could simply freeze your card, playing havoc with travel plans.
To avoid those scenarios, pick up the phone and call your issuer, using the number on the back of your card. Many card issuers let you do the same thing online. Log onto your account and look for “travel notification” or a similar tab where you can fill in the dates and countries where you’ll be traveling.
“We strongly encourage our customers to contact us when traveling, whether they’re in the middle of a trip or about to leave,” JPMorgan Chase spokesman Rob Tacey said in an email.
In some cases, he said, the company notifies its frequent travelers that it’s not necessary to notify the company in advance because it’s already aware the card is often used far from home. But generally it can’t hurt to call your credit card issuer and alert it of impending trips.
Chip or no chip? If your credit card has been around a while, it’s probably not imbedded with a microchip, a security feature that makes it harder for cyberthieves to steal your credit card info. These microchipped cards are standard in Europe, but many Americans don’t yet have one (although they’re becoming mandatory by October 2015).
In most cases overseas, “a standard old American (magnetic) striped card will work most of the time in most places,” said Ed Perkins, a SmarterTravel.com writer.
He added: “If your bank offers the option of getting a chipped card, I recommend it because it decreases the chances of running into a problem.”
Know the numbers: Keep a copy of your card’s toll-free customer service numbers with you, separate from your wallet, in case you need to report a loss or theft. Bury one in your luggage and send a copy to a friend or family member, just in case it’s needed.
Also, many travel experts recommend carrying two credit cards, keeping one as your backup in case your main card is lost or stolen.
Get your freebies: Many consumers aren’t aware of little-known benefits that come free with their credit cards, said Perkins. Depending on the card and the issuing bank, the perks can range from free referrals if you need a lawyer or doctor in a foreign country (the referral is free, not the professional services) to hotel room upgrades.
Among the best freebies is coverage for lost or damaged checked baggage, up to $500 beyond what you might receive from the airline. Most U.S. airlines will cover up to $3,400 in cases of lost baggage, said Perkins, but certain items are excluded, including cash, family heirlooms and expensive technology, such as computers.
“If you packed an expensive camera in your checked baggage, some cards will cover up to $250 per lost item. … It’s not a lot, but it can make a difference,” Perkins said.
The biggest benefit, said Perkins, is coverage for damage to a rental car. If the damage occurs in the U.S., the credit card reimbursement is generally secondary coverage that kicks in after you first file a claim with your insurer. If it’s an overseas rental car, which usually isn’t covered by U.S. insurance, the credit card coverage may be your only option to recoup the cost of damages.
Minimize fees: Most credit cards add a 1 to 3 percent currency conversion fee to the cost of any purchase outside the U.S., even when you pay in dollars. Some cards however, like Capitol One, have eliminated it entirely. If you have more than one credit card, you might want to check the fees and use the one with the lowest foreign transaction fee.
When traveling overseas, you will probably be hit by ATM fees when you’re getting cash withdrawals in local currency. There are a couple of ways to minimize these fees, which can be as high as $5 per transaction:
Call your card issuer to ask if it has partnerships with bank ATMs in other countries.
When doing ATM cash withdrawals, get large amounts so you’re not making frequent ATM stops and incurring fees.
In general, Perkins recommends using a debit card to make cash withdrawals (because of lower fees compared with most credit cards). For large purchases, like hotel stays, car rentals and shopping, use your credit card.
Perkins also noted that at all costs, avoid going to a currency exchange office or airport kiosk, which typically charge high currency conversion fees.
Holiday weekend travel to rise
Travel during the Memorial Day holiday weekend will rise to the highest level since 2005, boosted by more automobile trips, as pump prices drop and the economy improves, AAA said.
About 36.1 million people will journey 50 miles or more from May 22 to May 26, the nation’s biggest motoring organization said. That’s up from 35.5 million a year earlier and 2.6 percent above the 10-year average of 35.1 million.
AAA predicts that average gasoline prices will be similar to or slightly less than last’s year’s Memorial Day average of $3.63 a gallon.
The Associated Press