As a native of Asheville, I never had the misconception that summer is the only time of year for travel. Whether it was the sight of tourists who made the pilgrimage to view western North Carolina’s fall foliage or noticing those who abandoned Asheville for warmer weather in the heart of winter, it was always clear to me that a great getaway can be had any time of year. For those with a similar mindset who are planning trips in the near future, it may pay dividends to review and plan for the financial aspects of travel. This is particularly relevant for those planning international tourism.
Most travel veterans are well aware of the universal rules such as notifying your bank of your travel plans to ensure that credit and debit cards are not declined, however, it never hurts to review. Another relevant tip would be to research your destination ahead of time to confirm that local businesses accept your credit card network. In addition, an increasingly common benefit for cardholders is “no foreign transaction fees.” When there is a fee, it is usually 3% or less per transaction, but this can add up if credit is the preferred payment method. If multiple cards are available with similar benefits, this could be a differentiator.
Being able to pay with a card is not only more convenient and safer than carrying cash, but most of the time it also provides competitive currency exchange rates. In contrast, currency exchange centers typically occupy the other end of the spectrum. They can be inconvenient at busy locations such as airports, and they tend to offer less attractive exchange rates. If it is necessary to have cash on hand for tips and local market purchases, another alternative would be to check with your bank before the trip. Some of the larger institutions offer currency exchange services at reasonable rates. As a relevant aside, it is best practice to only carry the cash needed for each day’s outing in a foreign city.
Beyond the traditional payment concerns, there is another trend in travel that could impact your finances. Americans are developing more curiosity about travel to less accessible locations, some of which have been under US sanctions. A timely example might be Cuba. Should you be considering a trip to a country that might fall in this category, please look into the Treasury Department’s Office of Foreign Asset Control (OFAC). The sanctions programs list can be found at the following address:
If the destination is included in OFAC’s sanctioned list, you will need to plan ahead. As a general rule, a traveler should plan to operate with cash in these locations. US based financial institutions are usually barred from servicing individuals in these countries, even if those individuals are US citizens and clients. Should a financial institution receive a request from a client in a country on the OFAC sanctioned list, the individual’s accounts could be frozen until confirmation that the client is back on US soil. As this could affect investment trading, bill payments and other necessary services, please consult all relevant parties including your advisor before your departure.
If you have any questions about the above information, please do not hesitate to give us a call. Safe travels and enjoy the journey!