Co-author: Ellie McLachlan
When it comes to deciding how you will spend your money overseas, there are so many options out there, from credit cards to travel money cards. Choosing a credit card is a popular and convenient option, but it’s important to consider how much your card could cost you.
Foreign transaction fees are one thing to look out for when selecting a credit card to take with you on your travels.
What are foreign transaction fees?
There are a range of foreign transaction fees that could put you out of pocket if you aren’t aware of them. When comparing your options for a credit card to take travelling, it’s a good idea to consider some of the following fees:
Currency conversion fee
You will likely be charged a relatively minor currency conversion fee when making a purchase to convert your New Zealand dollars to the local currency. The average currency conversion fee for credit cards on Canstar’s database sits at 2.26%, with the maximum charge being 2.60%.
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International Cash Advance ATM fee
If you are travelling to a heavily cash-based country you are going to want to be able to withdraw cash pretty often. But you might find your bank charges a fee to withdraw cash in a different country. You could be paying as much as $7.50 per ATM withdrawal, while the average of $5.05 isn’t exactly cheap either.
It’s worth considering your options and comparing credit cards to find something suitable for you.
Other credit card fees to watch out for
There are a few more credit card fees that you might be charged and should know about. Most of them are avoidable – but only if you know about them in the first place!
Be aware of the potential to be charged:
- An annual fee
- An annual fee for a subsequent card
- Credit card interest
- Foreign currency conversion fee
- ATM cash advance fee
- Late payment fee
- Over the limit fee
- Dishonour fee
- Over the counter payment fee
- Replacement credit card fee
For a more detailed summary of credit card fees, check out Canstar’s roundup of 11 credit card fees you need to know about.
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