When you're on the move, crossing oceans, borders and cultural boundaries, it's clear that different countries have different ways of doing things. International banking systems also vary widely and the safest way to travel is to give yourself all the options you possibly can. That way, you'll be able to access and safeguard your funds, wherever you travel.
Keeping on top of your finances back home
First and most important, make sure you leave enough funds in your account to cover any credit card bills or direct debits, etc. that might still be active while you're away.
Enlist your family to help.
To save you having sleepless nights when you're on the other side of the world, it's a good idea to give a family member authority to keep an eye on your bank account back home. That way they can let you know if there's ever a problem or a bill that needs paying. Then you can deal with it through Internet banking. Simple!
And if you really trust them you can add them as 'signatories' to your bank account That's bank speak for authorising others to access your account and make payments and withdrawals on your behalf. You will probably have to see your bank in person to do this.
Consider automatic payments.
You can also set up direct debits with some companies. That way, when a bill comes in, the money is automatically taken out of your account on the due date. Just make sure you keep enough funds in your account to cover your bills - if you don't, you could be charged a dishonour fee.
Tip
It's a great idea to set up an automatic transfer to take a set amount of money from your savings periodically and put it into your everyday account. It means all your money isn't in one account and gives you a bit more security in case you lose your ATM card or have the urge to overspend.
If you haven't already set up an Internet banking facility, now's the time to do it. Then you can keep an eye on the comings and goings of your account and stay in control of your bank balance wherever you are in the world. With so many Internet cafes around, you can check your funds virtually everywhere.
Be aware though. A private computer is probably safer than a public computer. If you're in public, don't check your account details if you think someone can see your screen. Be smart and set up a special password that only lets you see your account balance but doesn't let you withdraw or transfer any money. That way, if someone else does get hold of your details, they can't access your money.
To find out how to manage your account online through NetBank, click here.
It's an amazingly handy little piece of plastic. Stick your card in any of the zillions of overseas ATMs (you'll need to look for the logos on your card, usually something like Cirrus/Maestro) and, no matter where you are in the world, ta-daa! - local currency will pop out. It doesn't get any handier, but unfortunately you'll still be stung for foreign exchange commission, surcharges and transaction fees which will be taken out of the same account. Check with your bank before you go, but generally you'll pay anything from $1.50 to $5 per transaction.
Keep in mind that foreign ATMs may provide inaccurate account balances because they are not updated as frequently as you might expect. As you won't be getting statements while you're away, you should use Internet banking to check your transactions and balances.
Worldwide acceptance generally makes Visa and MasterCard credit cards very convenient. But they also require more discipline than ATM or debit cards. So unless you think you have enough self-control it's probably best to think of it as being there for emergencies only, like if you suddenly have a big medical bill to pay.
The good bits.
You can use your credit card when you don't have enough money in your account. You may have some interest-free days and as long as you're happy to pay interest after that, a credit card allows you to pay off the items over time - which is good if you know you'll be getting income to cover it.
The bad bits.
The longer you leave repaying what you owe on your credit card, the more interest you'll have to pay on it. And because you can keep piling things onto your credit card (up to a set limit) you can get yourself into major debt if you're not careful. Also, if you use your credit card to take cash out of an ATM you'll be charged a cash advance fee and interest immediately.
If you are planning on using your credit card, don't front up at your little hotel in the backstreets of Rome at 10pm hoping to pay by credit card, only to find that they don't accept them. Check in advance if credit cards are accepted so you won't get caught out.
Finally, don't forget to check your credit card limit before you travel. And remember to do your conversions so you can keep track of how much you're spending. For example, spending GBP£250 in the UK will easily put you over your AUD$500 limit once it's converted.
Tip - Manage your credit card online
Before you head overseas, make sure you'll be able to keep an eye on your credit card bill while you're away by accessing it online. That way, there'll be no nasty surprises once you get back.
Tip - Go into credit before you go
A smart way to get ahead on the credit front is to deposit some money into your credit card account before you leave. This will prevent you racking up as big a debt, and help you save on interest.
First there were prepaid mobiles. Now there’s a prepaid ATM (Cirrus) card called traveller’s cash.
This clever card can be ‘charged up’ with foreign currency before you travel so you can lock in your exchange rate. By using it you can also avoid the conversion fee normally charged when you use an overseas ATM. For example, if you put Euros onto your card, when you use a Euro ATM (Cirrus) you won’t pay the extra foreign currency conversion fee.
For more information, visit travellerscash.com.au or visit your local branch
In a world of Internet banking, ATMs and credit cards, travellers' cheques might seem like a bit of an antiquated novelty. But they're still around because they're safe, handy and accepted in almost every country around the world.
Where can you cash them?
In bigger towns and cities you're laughing: there'll be banks, travel agents and Bureaux de Change all over the place. But don't expect to convert them when you're in the middle of nowhere.
Ask for small denominations too so you only cash what you need. Having said that, don't make them too tiny as you may pay a commission when you cash a cheque.
Don't forget your passport
Make sure you always carry your passport safely and securely at all times. You'll be asked to provide your ID when you countersign your travellers' cheques and other forms of ID, such as a driver's licence or credit card may not be recognised.
With ExpressFX you can order foreign cash and travellers’ cheques online and we will deliver them to the Commonwealth Bank branch of your choice within 3 working days. This maximises your time for packing and re-packing. Visit commbank.com.au/expressfx for more details.
Sure, cash is accepted everywhere (if you have the right currency for the country you're in) and it's easy to spend. But, except in small amounts, it has a lot of drawbacks.
When cash is good.
When cash is bad.