Banking While Abroad
We are driving from our exciting stay in Rome to beautiful and culturally rich Florence. For the first time on a road trip we have company – Barbara, or Babs as we call her. She met us in Rome with another dear friend, Tyler. After we all feasted our eyes and exhausted our feet in Rome, we are off to new adventures in the beautiful country of Italy. Not only is Italy beautiful but it also offers well-maintained roads that are easy to navigate. The roads are not free though. Italian tolls are costly and are time consuming to stop at. Tolls are not a novel experience for us though. We are used to paying them and waiting in line. However, we learned an important lesson on this road trip to Florence.
We have driven throughout Europe for almost six months at this point and we feel like toll booth experts. We aren’t. It’s our turn to pay the toll. We creep up to the gate in our black 2019 Citroen C3. Roll down the window and collect our bill. Twenty Euros to get us through. We put in our card like we do at almost every other toll we have paid. Denied. Must have inserted it incorrectly. Let’s try this again. Denied.
Today, Ashley and I have made the error of not having cash, and now our trusty Visa card isn’t reading at the toll. No worries. Insert second card. Denied. Okay, wtf?! It’s now clear there is something wrong with the reader, but we are stuck. Cars are now gathering behind us patiently (read: annoyingly) waiting for their turn to pay. We cannot pull forward because the guard is still down.
Enter Babs: Guys, I have euros. How much do you need?
Whew! Thank you, Babs! This hat tip goes out to our willing and capable travel companion, Babs – always carry local currency on you, especially if you are making a road trip.
Banking abroad is an inevitable piece of long-term travel. Doing it the right, and budget-friendly way, takes some planning and setting up some precautions. Below, we will offer some tips and recommendations on ways to make your banking life abroad much more seamless.
Obtaining Local Currency
One of our goals is to blend in as much as possible while abroad. To pull this off, we were planning to use the local currency as much as possible. This can be tough to do because you don’t want to carry too much cash and risk losing it. Regardless, this was our initial goal. To achieve this, we needed a bank that would allow us to withdrawal money from any ATM while moving from country to country. We have American banks but ones who charge an ATM fee if using a competitor’s ATM – this would not work for us. It’d cost entirely too much.
After talking with a friend, we learned Charles Schwab offers full reimbursement of all ATM fees, no matter the location. Whoa! This is what we were looking for.
Charles Schwab has an investor checking account that comes with a debit card. The account does not require a minimum deposit amount, nor is there a maintenance fee. The debit card is a Visa and can be used like a credit card and an ATM card, assuming the card reader works properly. At the end of each month, Charles Schwab reimburses all fees associated with any ATM transaction. This would be our primary way of sourcing local currencies, receiving the best exchanges rates available, all free of charge.
This has been a big saver for us.
Now we no longer need to be concerned how large a fee the ATM charges. Nor would we need to visit those sketchy currency exchange booths where you inevitably leave feeling taken advantage of. Simply visit any ATM, withdraw cash and carry on with our travels. Perfect.
* ATM Travel Tip: ATMs will often ask if you would like the ATM to convert the currency. This often comes with a commission charge. Do not agree to this conversion. If you decline the conversion, then your bank will do the conversion free of charge (i.e., Charles Schwab automatically converts the currency in your account). You often receive a better conversion rate as well. We naively agreed to this conversion twice, costing us about $20 USD each time in commission charges. Our loss is your lesson.
A security feature of the Charles Schwab card (and most other credit cards) is to deny and report foreign transactions. For that reason, make sure to call Charles Schwab before departing on your travel journeys and advise them of the countries you will be visiting. If you prefer not to call, or are already abroad, you can complete the travel notice on their website here. Charles Schwab only allows a certain number of countries to be added to this list. Since we are constantly on the move, we update this every 15 countries or so. We place a reminder in our phones to keep it current and accurate. Just remember to have this done so you are not caught off guard while beginning your travels.
There are two limits you can set on your Charles Schwab card:
1. Daily spend amount.
2. Daily ATM withdrawal amount.
Perhaps $200.00 for both is reasonable, maybe a bit more for #1 in the event you need to buy cruise fare tickets or a similar pricey purchase. In the event the amount you want to spend or withdrawal is more, simply call Charles Schwab and they can place a one-time exception. Having these limits set lower is a good precautionary measure to protect yourself.
Bills at Home
We are not those travelers that sold everything and took to traveling. We still own our home with monthly utility bills, have a car loan, and many other responsibilities.
Making it possible to pay these bills while on long cruises or WWOOFing in Peru where we have limited internet access is best done by automating it all. Even though we use Charles Schwab to hold our travel money, we use a local bank for our at home bills.
It was rather simple to automate all these payments, often contacting each utility company and lender to set these payment up; most have the option to do it online as well. However, the City of Norman (where we live) does not have an option to set up automated payments so we place a reminder in our phone to notify us to go online and pay this bill each month – we set it five days before the bill is due to ensure it’s paid on time.
There are times when we need something done back home at one of our rental properties or our personal home; the grass grows, maintenance issues sporadically arise and air filters need to be changed. We approach this by enlisting the help of family and friends who we pay via Venmo or PayPal. Both of these allow easy exchange of money and are our preferred method of paying those that help us. You can attached each payment option to your preferred bank account, making the exchange seamless and easy.
Both Venmo and PayPal hold all transactions in your account history. This makes it easy when your mind is elsewhere and have forgotten whether or not you made that electricity payment. Outside of this, we keep a Google Sheets document detailing all our expenses. This really comes in handy; we update immediately after a payment is made to ensure for accurate personal records.
Lost or Stolen Cards
We were concerned of what we would do in the event we lost our Charles Schwab card, or needed to make a one-time payment online that required account and routing numbers.
We solved this by scanning:
1. Void checks
2. Credit/Debit Cards
2. All passport information
We have digital copies with this information stored on our flash drive. (See our recommended Packing List for details.)
We only brought two extra credit cards each. We did not want to risk having too many cards to keep track of, potentially having the number stolen. This is a reason we also like paying in cash. By using cash, we can rest easy knowing our credit cards have not been jeopardized. We both have a Charles Schwab card. In the event one is lost, we can place a freeze on that card while still using the other.
We have some tips on how to effectively use credit card rewards to travel long-term here if that’s your kind of thing: How to Use Credit Cards Rewards for Long-Term Travel. Credit cards can be a really fun and creative way to reduce a lot those big expenses, saving you a little cash.
We have a detailed Financial Breakdown on Long-Term Travel for those of you who are in the beginning stages of planning. This may be a helpful resource to you, one we wished we had when we began our planning.
We hope this was helpful to your planning. Please let us know your thoughts, questions, concerns in the comment section below.