Q&A: Avoiding credit card fees

France: Copyright Jane Wooldridge

Q: I recently was in Europe on business and found my credit card company charged me $8 on a $240 hotel charge. That seems high to me. My wife and I are going back for a two-week vacation and would like to know how we can avoid these kinds of fees.

A: Most credit cards charge a percentage fee for “foreign transactions” on top of additional fees your card issuer may impose. 

If your credit is good and you’ve got enough time before you leave, consider getting a credit card that doesn’t charge for foreign transactions; I use a Capital One card (and no, I don’t have any connection to the company.)

If that’s not an option, or you just don’t want another card, check out the rates on cards you already have. Be aware that you’ll pay high fees if you make a cash withdrawal against a credit card; using an ATM card to pull cash is usually cheaper.

You could avoid all of that by carrying travelers checks, but even then you’ll often have to pay a fee for converting them from U.S. dollars to the currency of the country you’re visiting. And in these days of widespread ATMs — I’ve found them just about everywhere in the world that has electricity, with the exception of a few places in rural Africa — many vendors won’t even take travelers’ checks.

Whatever card you use, call and let them know to which countries you’ll be traveling, and when. Be sure you’ve got enough credit and that your card isn’t expired. This will avoid the hassle (not to mention embarrassment) of having your card denied.

Conventional wisdom says you should stick with one card for all your trip purchases. Great idea — but be sure you’ve got a second card stashed in a different location. On a trip to Senegal, the ATM machine ate the card of one woman in our group; it was the only card she had with her, and we delayed the trip several hours until the bank re-opened so we could rescue it.

Also take the emergency contact numbers for your cards; an easy way to do this is to scan the back of your cards and e-mail them to yourself or upload them to a cloud service like Dropbox or Google Docs. I once had my wallet stolen in London but didn’t have the phone numbers handy to report the loss of my various cards. Sorting out the mess took two days, and by the time my “replacement” card finally arrived at my London lodging, I was on my way back to the U.S.