Credit Cards and Cash on the Road

One of the questions we get asked frequently is, “How do you pay for your daily purchases while traveling?” The way we handled cash, cards and purchases while we were in Asia for 5 months was definitely not like our routine when we are in the US. And it was also different from the way we did things in Europe last year. Our routine has definitely evolved over time as we changed from vacation travelers to full time nomads, but we also develop routines for handling our spending based on our specific location. In some countries we use a predominately cash based system and in others we put all purchases on credit cards.

In 2018 we had some challenges with our cards in Europe, but the solution was to make sure all of our credit cards have chips and all of our ATM cards have chips and pin numbers. Thankfully, we didn’t have any major issues using our cards in any of the countries we visited in Asia over the first half of 2019.

We have 3 options for making purchases:

  1. Credit cards that charge no foreign transaction fees.
  2. ATM cards that have no foreign transaction fees, and reimburse or wave all ATM fees when used “in network.”
  3. CASH in the local currency.

Our Credit Card Basics 

Since we are full-time travelers all of our credit cards are travel rewards cards. We are only interested in credit cards with No foreign transaction fees on purchases, that also have good “cash back” or travel rewards programs so we can earn points as we spend.

Purchases and Currency Conversion Rates 

We try to use credit cards for our purchases whenever possible. This helps us reduce the amount of cash we have to carry, helps us build travel rewards points, and gives us access to the most favorable exchange rates when making purchases in other currencies.

To get the most favorable conversion rate we always opt to make purchases in the “local currency” if the option is available. Visa, MasterCard, and American Express generally set more favorable conversion rates compared to airport money exchange counters or local money changers.

If we make purchases with our cards in other countries using US Dollars the vendors use a “Dynamic Currency Conversion” to convert the local currency into US Dollars at the vendor’s rate. These rates are never as good as a market rate for us as buyers. When we make purchases in other countries we are often tempted to try to do the math and convert prices to US dollars in our heads, but it’s easier to just use the local currency no matter what it is.

For more information about currency conversion rates and foreign transaction fees check out this article at creditcards.com.

The Credit Cards We Have Today

  • Chase Sapphire Reserve VISA
  • Chase Sapphire Preferred VISA
  • Chase United Explorer VISA
  • Bank of America Alaska Signature VISA
  • Hilton Honors Ascend American Express
  • Hilton Honors American Express
We take turns getting new travel rewards credit cards so we can keep racking up the sign up bonuses. In 2019 we used Chase points to fly from San Francisco to Singapore, and from Tokyo to San Francisco. And as of the time of this post our Chase Points Portfolio still has over 500,000 rewards points ready for our next big flights.

Our Primary Card, the Work Horse of our Points Portfolio

The bulk of our spending goes on our Chase Sapphire Reserve VISA. This card has no foreign transaction fees and works great 99% of the time for our purchases. Its only flaw is that it has not always been reliable for payments that require a pin number at a kiosk, though it always works perfectly if there’s a customer service person there to approve the transaction or ask for a signature. We are still experimenting with using a pin with this card since it works sometimes but not others, and it’s possible there’s some user error on our part sometimes! For example, we tried to use this card to buy fairly expensive bullet train tickets in Japan in May 2019 at a train station kiosk. The machine clearly needed a pin number but couldn’t take one, so it spit our card back out with an error message I would roughly translate as “Yuck!” In that case we just walked a few steps to the big ticket counter with customer service staff and they ran the same card successfully for us and took a signature to approve the transaction. The pin number issues seem to be a flaw in American banking translating to systems in other countries, and this is genuinely a drawback for this card for us. But we consider it part of the learning curve and it has never been a real issue since we are always prepared with other cards and cash just in case.

Most importantly, Chase uses the more favorable market rate when converting purchases from the local currency to US Dollars. With this card we earn 3x points per $1 spent on things like hotels, plane tickets, Ubers/Grabs, trains, and restaurants. That sort of thing is almost all we spend money on at this point so that’s perfect for us. It’s also very easy to log your travel plans in Chase’s online travel portal, which is probably why we never have any purchases declined or receive mistaken fraud alerts as we move from place to place.

The Chase Sapphire Reserve VISA also has some other really nice travel perks like access to Priority Pass airport lounges for free. In the first 5 months of 2019 we spent some big chunks of time in 7 different airport lounges enjoying unlimited food and drinks. Once we even brought in a 3rd person on our one Priority Pass to indulge on airport lounge perks for over 3 hours when we were traveling together from Hanoi to Osaka. The Chase Sapphire Reserve VISA has a big $450 annual fee, which is probably a deal killer for some people. But since the first $300 spent on travel purchases is reimbursed we think of it as only a big $150 annual fee, which is still hefty but considering the perks and reimbursements we get, the Chase Sapphire Reserve VISA is basically free to us when we use it strategically.

We get pretty excited every time we find a Priority Pass lounge where we can while away the hours enjoying free food, drinks, and wifi.

We Seem to Love Chase Cards

We have made our way through most of the Chase cards, better known as the Chase Gauntlet, at this point, and we have 3 open right now. The Chase Sapphire Reserve VISA is our primary card. The Chase Sapphire Preferred VISA is a great backup card for Chase Ultimate Rewards Points, though it only gives us 2 points per dollar spent on airfare, hotels, and rental cars, and 2 points per $1 spent at restaurants, and has a $95 annual fee. The Chase United Explorer VISA has a $95 annual fee and gives us 2 points per dollar spent on restaurants, hotels, and United purchases.

Lastly, we also love when our travel rewards cards come with travel related insurance perks like collision coverage for car rentals, trip delay or cancelation protection, lost baggage protection, and more. The Chase Sapphire Reserve VISA is definitely filling that need for us! The first time we took advantage of that type of credit card perk was when we were driving from Amboise to Beaune in France, and I scraped the rental car on a concrete pillar at a gas station. I was absolutely horrified when that happened and was frankly terrified of what that might cost us to repair. But Ali made a phone call to Chase and then filled out a form online with a couple of photos, and about a month later all of the damages to the rental car were paid by Chase and we got off “scott free” as they say. This particular credit card definitely seems to be relatively perfect for us, but we point out to friends that it’s important to read the fine print including the part that says “your mileage may vary” because it may not feel as magical to others depending on how you use this kind of credit card.

While driving a rental car around France for 3 weeks we had a bit of a collision with a low cement post, which left dents and a long scrape across the entire passenger side of the car. Luckily, our Chase Sapphire Reserve VISA benefits included coverage for this mistake and we owed zero dollars!

The Other Cards On Our Bench

We like to cycle credit cards through our system as new signup bonuses or new perks present themselves. In the last few years we’ve opened several cards to get the signup bonuses but then closed them within the first 12 months so we aren’t paying the annual fees. I’m currently on the hunt for the next best card to sign up for later this year, which we will apply for at the right time to cover our 2020 annual medical insurance premiums. Currently, we have 3 other credit cards in our wallets that are associated with hotel or airline rewards programs. Each of them are legacy cards from our early days as vacation travelers when we were new to credit card loyalty programs.

Alaska Airlines VISA

While we were living in Seattle most of our flights were for short weekends to see family in California and Arizona. We flew exclusively on Alaska Airlines for those trips, and Ali was also taking weekly flights for work on Alaska Airlines so we each had a Bank of America Alaska Airlines VISA card and we worked at maximizing points within that program. But as our lives changed so did our cards. Ali canceled her Alaska Air card and I kept mine open until this summer to get one more companion pass perk since we assumed we would want to use that to visit family while in the US. We have been back in the US for 20 days now and didn’t find a reason to use that card or perk, so now it seems obsolete. Sometimes it’s better to protect your credit score to downgrade a card rather than cancel it if its line of credit has been open for a long time and it isn’t costing you money. So I’ve decided to try to downgrade that card to a no annual fee card or cancel it if they won’t downgrade it.

Hilton American Express Cards

The other travel reward cards we still have are two Hilton Honors American Express cards. Ali got the first Hilton American Express card back in 2010 because while she was traveling for work she ALWAYS stayed in Hilton Hotels and was racking up huge numbers of Hilton points that way. As full time nomads we do still use Hilton Hotels occasionally for points stays when we don’t want to pay for our housing with dollars. We are chipping away at our bank of Hilton hotel points since we aren’t planning to pay for Hilton stays with real dollars.

We added a second Hilton American Express Ascend card to our portfolio in September 2018 for its big signup bonus. We pretty much hit the minimum spend for that card by paying a year in advance for our little 5×10 storage unit back in Seattle, plus the purchase of our new Google FI global cell phone to use as our only phone for our new life as nomads. The Hilton American Express Ascend card is great because it earns 12X points per dollar of eligible purchases at hotels in the Hilton portfolio. But, we don’t really spend any actual dollars when we stay at Hilton hotels, and we have no plans to stay at another Hilton in 2019 where we would possibly charge a few dollars for incidentals during our points stay. So as I write this post Ali is adding to her to do list to call and close this Ascend card account this week, long before the annual fee would be charged in September.

For now, we want to focus on credit card programs that are more helpful to us for earning and spending points on international airline travel, and if any of our existing cards don’t meet that requirement they will get voted out of our wallets within the year!

In 2019 we stayed for free using Hilton points in Singapore for 8 nights as well as in Kuala Lumpur for 8 nights. Since the old Hilton American Express card has no annual fee and that line of credit has been open since 2010, we are keeping that account open even though we don’t make purchases with it. It gives us a great backup plan for purchases and that longterm credit line looks nice on Ali’s credit report.

We had a great time spending evenings on the rooftop deck at the Hilton Garden Inn we stayed at for free in Kuala Lumpur Malaysia.

We Never Use Credit Cards as ATM Cards

We don’t used credit cards for cash advances. One reason why we avoid using credit cards as ATM cards is that some credit cards would charge significant fees for any cash advance. It’s an inefficient use of a credit card to use them as ATM cards. Ideally you should carry a credit card for purchases and an ATM card for cash withdrawals in order to make the most efficient use of each type of card and avoid paying additional fees.

Our Plan for ATM Cards and Cash

We make sure we always carry a modest amount of cash in local currency and pay attention to what is allowed in every restaurant and store we enter before we need to pay. Since we have been spending so much of our time in third world countries and making purchases from small business owners and street vendors we have learned to verify whether or not stores, restaurants, and street food vendors take credit cards as soon as we arrive. We want to make  sure we have the cash available for whatever we are buying if they won’t or can’t take credit cards.

There’s often a “Cash Only” sign posted at shops, restaurants, and food carts but when there isn’t we just ask upfront because it’s hard to predict when we’ll get a response like, “Oh our credit card machine is broken!” Sometimes that means their credit card machine is broken, and other times means they really want to avoid using their credit card machine since the additional fees for them might be a burden. The only thing that matters is they get to pick how they are paid and we are always respectful of that. So we try to make sure we have an awareness of our purchase power and plan ahead so we can stick to our money goals and make our way smoothly across any city.

We have two sets of ATM cards, one from our primary bank at Charles Schwab and another from our daily spending bank at Capital One. The Schwab VISA ATM card clearly lists the networks it works with. For some reason the Capital One 360 Mastercard doesn’t list the ATM networks on the card but if you look online you’ll find they are Cirrus and Maestro.

Carry Small Bills and Coins

Many of the smaller cities we have visited in Asia and Europe were places we could only use cash for our purchases, and only in small bills and coins. We know we won’t get away with getting large bills at an ATM and then handing over a $50,000 Yen bill to buy a 200 Yen bowl of Ramen ($1.84 USD) from a street vender in Osaka. If we try that we would probably get the universal sign for No with both hands held up forming a big X. We have trained ourselves to always carry enough small bills and coins for street food and restaurants. So as soon as we have a feel for the average cost of lunch, or a metro ticket, or a green tea ice cream cone, we can figure out how to always have enough cash with us in smaller bills and coins that are easy for people to make change from.

It has become normal for me to look at the pile of coins in my wallet and then offer my hand full of coins to cashiers when it’s difficult for me to recognize the different values. Like with the first few times I wondered what to do with the coin in Japan that has no number on it. Whenever I have held out my hand full of coins for cashiers to pick through and show me what I owed it turned into a sweet and humbling way to ask for help and then a chance to act silly and make someone laugh during the exchange.

The first time someone made this “universal No” gesture to me in Southeast Asia, I was really surprised because I had never seen it before. But then it clicked! That big X is a very clear No. During our 5 months in Asia we saw this a lot, mostly when we asked, “Hello. Do you accept credit cards?” And the most important time was wen we asked, “Hello. Is this the train to Tokyo?” This “universal No” gesture is awesome!

Do We Make Frequent ATM Withdrawals?

Typically, we withdraw only enough cash from an ATM for a few days at a time. We don’t want to carry too much cash or too little as we explore a city, we are looking for that sweet spot with daily cash in our pockets. When I do withdraw a lot of cash we only carry what we really need for a day or two in one wallet. The rest is put in a room safe or stashed in our room somewhere strange if there is no safe. We have been really lucky so far and have never been pick pocketed or lost any money while traveling. But we know it could happen at any time, anywhere, so we try to be really vigilant and protect our money. We do also stash backup cash in hiding places we wear, like our belts that have zippered pockets inside the belt strap. We don’t want to carry all of our daily cash eggs in one basket!

Making Safe ATM Withdrawals

One of the major reasons we like having our main checking and savings accounts at Charles Schwab is because they offer an ATM card that has no foreign or domestic transaction fees and also reimburses foreign and domestic ATM access fees. The other reason is that we use Schwab as our primary financial center and have all of our investment accounts there as well. But in 2018 when we were preparing to start our full-time travels I decided I didn’t want to use that one ATM card for every cash withdrawal on the road since it’s connected to every single penny we own. You can call me paranoid but I want to be ultra prepared and ultra protected!

There are lots of stories out there describing why ATM machines are not all reliable, and privately owned ATMs in third world countries have a reputation for being more prone to security issues. This isn’t a third world concern it’s more of an attempt to protect our core accounts from ATM fraud issues in the US or Thailand or France or Mexico or anywhere else.

A few weeks before we hit the road as nomads in 2019 we opened a new Capital One 360 checking account to use for our cash withdrawals as we travel. I keep the Capital One checking account funded at minimal levels for our daily living expenses and we draw from that account for all of our cash at this point. 

The important thing is that if someone did get their hands on our Capital One 360 ATM card they might be able to empty that account but they couldn’t use that card to access our real money over at Schwab. I specifically chose Capital One because my research and conversations with bank staff assured me that this is a great bank for global travelers and they would charge no foreign transaction fees and also reimburse ATM access fees. It seemed like a good addition to our spending program.

A Variety of ATM Networks

There is one interesting bonus in having the two different ATM cards we have in our wallets, which is that we now have access to a larger variety of ATM networks. Our Schwab ATM card uses the VISA Plus network, and our Capital One 360 ATM uses the MasterCard Cirrus and Maestro networks. All of the networks our Schwab ATM card uses are clearly stamped on the card. Oddly, the Capital One card is not physically stamped with the networks it uses on the actual card but it is stamped with the MasterCard symbol and we were able to look online to verify its ATM networks which are Cirrus and Maestro. We have learned to really pay attention the networks each ATM machine uses since that’s the key to avoiding transaction fees. We’d prefer not to use our Schwab ATM for daily spending withdrawals but we are glad it’s there as a reliable backup plan.

Local and Private ATM Fees

During our travels in Southeast Asia we were not always able to find ATMs that were connected to any of the networks our cards were using. And unfortunately, you can’t avoid being charged fees by local banks or private ATMs that are outside your network, even if you have an awesome ATM card. So we do our best to know the networks for our ATM cards and use them if we can.

Japan

Japan was like the golden ticket of “no fee” ATM use for us because most of the ATMs we found in Japan were tapped into all of the banking networks we were looking for. We quickly found a favorite ATM and learned to hunt down the Seven Bank ATMs with that familiar 7-Eleven logo throughout our month in Japan. We thought it was funny the first time we saw one of these, and we were thrilled when we realized they were in every 7-Eleven store, train station, airport, and shopping center we visited in Osaka, Kyoto, Tokyo, and Hiroshima. By using the Seven Bank ATMs we were able to withdraw cash with zero fees as often as we needed to. That’s one more gold star in the Japan travel bucket for us!

Vietnam

On our first day in Hanoi Vietnam we walked for an hour through the Old Quarter and found a dozen private ATMs, but not a single one was on any banking network as far as we could tell. The next day we walked in a different direction into a more urban looking area with convenience stores and eventually we did find an actual bank branch with an ATM in the Cirrus Network. We did make a withdrawal there, and that local Vietnamese bank charged some withdrawal fees that were not reimbursed by Capital One. There’s not much you can do to avoid local bank and private ATM fees.

This was just one of the funny private ATMs we found in Vietnam. Don’t mind the table or extension cords, just stick your ATM card in here. You can get cash and a bowl of Pho at Auntie’s ATM side hustle.

Thailand

In Thailand we noticed that every ATM we used was charging basically the same fees, regardless of whether it was a big Thai bank or more of a private ATM. And the fees were high. Unfortunately there is no way to avoid paying those high ATM fees in Thailand as far as we can tell. We did our research and tried a variety of banks and ATMs and the fees always seemed to be around 220 THB which converted to over $7 for each and every withdrawal on our Capital One card. There was nothing we could do other than grin and pay it if we wanted to make cash withdrawals. I also noticed that sometimes those fees were listed on our banking statements as if they were separate withdrawals of cash for around $7.30 each rather than as transaction fees.

Ordinarily we hunt down no fee withdrawal options and take out only a couple of days of cash per withdrawal, but in Thailand with their ATM fees that wasn’t a good option for us. We came up with two tricks to try and avoid horrendous Thai fees. The first one was to take out more cash each time so we would be making fewer withdrawals. The other option was to take our stash of US Dollars to reputable money changers and convert that cash to Thai Baht since those money changer fees were far lower than local ATMs fees.

Currency Exchange

We also had trouble finding ATMs on our networks in Kuala Lumpur, Malaysia. We talked to the staff at our hotel about that and they recommended a reputable money changer in the area that was charging really low fees. So we tapped into our secret stash of US dollars and exchanged enough to get us through our few weeks in Malaysia. That ended up being a good option for getting cash relatively cheaply. The money changer we met quoted a very reasonable exchange rate with a low flat fee mark up to give him a little commission on the exchange, which was actually quite a bit lower than what we would have paid in fees for an equivalent one-time ATM withdrawal if we had withdrawn cash from the ATM machine around the corner. That was a very easy experience once we got used to the process.

We Hit the Ground First and Find Cash Second

On our trips before 2018 we used to always get some cash in our destination currency from a local bank at home before we left. We learned that in order to get money exchanged at a US bank you often need to have an account with that institution. Our main bank is Schwab and they don’t have any branches that handle currency exchanges, so we used Bank of America because we have one of their credit cards. If you go this route, make sure you give yourself at least a week to arrange the transaction since banks might have to order the money you’re asking for in advance. For us this option is not relevant anymore.

Now that we travel full time we just start with a few hundred US dollars stashed in a few places, then we plan to make an ATM withdrawal in local currency once we are on the ground in our destination country. We also try to completely spend our local currency and run out of it before leaving so we don’t have to exchange it. When we arrive in an airport at our new destination we focus on finding an in-network ATM before we leave the airport whenever we can. We have learned that the money exchange booths in the airport usually offer rates higher than the “market rate” as well as tacking on a conversion fee. We are usually able to find an in-network ATM, but when we can’t, there is no shame in backtracking and getting enough local currency from the exchange booth to last a day or two. We just keep our eyes open and figure out the best or only options.

5 Months Later – How’d We Do with Our ATM Cards?

Schwab ATM — Still our Favorite

During our 3 trips to Europe in 2014, 2016, and 2018 we exclusively used our Schwab ATM card to withdraw cash on the road. This card links to our primary bank account, has no foreign transaction fees when used as a VISA, and reimburses all ATM fees when withdrawing cash in-network. We were very careful to always try to use local bank ATMs that were associated with the PLUS network. Because Schwab also holds our retirement accounts like IRAs, Roths, CDs, and our taxable brokerage account, I feel more comfortable now only using our Schwab ATM card as a backup should our other cards get lost or compromised. That’s my routine out of an attempt to be uber cautious with our core accounts.

Capital One ATM — Our Primary as a Precaution

For our first trip to Southeast Asia, I wanted some redundancy when it came to accessing cash on the road. I had read that it was really important to be careful when withdrawing cash in Southeast Asia as there are lots of ways ATM machines, and your accounts, can be compromised. By using our Capital One card and accounts for ATM withdrawals on the road we are trying to protect our primary Schwab accounts. I transfer cash from Schwab for our daily living expenses to Capital One and then withdraw cash from the Capital One accounts with our ATM using in-network bank ATM machines. The Capital One 360 account ATM also charges no foreign transaction fees when using in-network ATMs. This card uses the Cirrus and Maestro networks. 

For the most part, the Capital One ATM card worked like a charm. Looking back over our 5 months of transactions in Asia we made a total of 21 withdrawals across 5 countries in Singapore, Malaysia, Thailand, Vietnam, and Japan. We noticed that Japan was the most familiar country for ATM access while in Southeast Asia we couldn’t always find access to ATMs in our networks or avoid local fees. The table below shows all of the non-reimbursable ATM fees we were charged in each country we visited in Asia this year.

This is a list of our withdrawals and the local fees we had to pay for each transaction in Asia.

Here’s How We safeguard Our Cards and Accounts

  1. Only use In-Network ATMs. Make sure you know which networks your banking cards work with. Note that sometimes they are not all displayed on your physical card. Search online for more information before you travel.
  2. Only use ATM machines that are indoors. Do not use ATM machines that are open to the street 24 hours a day. This will reduce the probability of coming in contact with hidden reading devices that can collect your data.
  3. If ATM machines look shady, check the card slot. If you can grab the edges of the slot give them a good wiggle and make sure they are solid and fixed to the machine. If the card slot seems separate and wiggles, don’t use it.
  4. Protect your PIN. The other common ATM hack is to setup a small camera in view of the keypad to capture pin numbers as you type them. It sounds goofy, but there are times when it’s worth making an extra effort to cover your hand and the keypad while you enter your PIN to protect it.
  5. Keep all credit and ATM cards in protective RFID sleeves. Cards with chips in them use radio frequency identification (RFID). That technology makes it easy to pay and is also easy to read from your wallet without physically taking your card. Portable card readers have been designed to read RFID data through your bag, wallet, and pocket. There are a variety of RFID protection sleeves and bags available to help protect from this type of data theft. 
These are the RFID sleeves and bags we use for our cards and passports.

That’s it for Now!

Our goal is to find a routine for spending that makes it easy for whoever we are buying from to get paid, while also helping us to avoid fees and protect our money. Everyone is different so find the buying and spending combination that works for you, in the place you’re traveling to, so using your money is a breeze. Do your research, create backups, and focus on having a great experience when you travel!

If you have any questions about what we are doing or how we are doing it, feel free to send us a message. And if you are interested in any of the credit cards we are using you can find links to some of them in the Resources page on our website under Affiliate links or just search for them online.

2 comments

  1. Super interesting and detailed – thank you! I didn’t know the Capital One 360 didn’t have foreign transaction fees. Adding it to my list! Was already planning to get a Schwab account for the ATM reimbursement.

    Liked by 1 person

    • Thanks! We are pretty happy with the Capital One 360, and continue to be totally satisfied with Schwab as our primary bank for everything including checking and savings. Kind of miss having everything at Schwab, but we are so glad we added Capital One since it makes us feel more protected!

      Liked by 1 person

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