The Best Ways To Avoid Sneaky ATM Fees While Vacationing Overseas

While traveling abroad can be exciting, the expenses quickly add up. On top of the expected food, transportation, and lodging costs, you also need to worry about using an ATM to withdraw cash. Unless you're using a teller serviced by your primary banking institution, chances are you're going to incur a fee whenever you hit an international ATM. Some countries' ATMs, such as Japan, also charge different fees for using ATMs at "peak times" during the workday. Since not every American-based bank offers overseas automated cash withdrawals, chances are you'll be racking up those extra costs. That is, unless you know how to skirt these sneaky ATM fees.

These fees are essentially a service charge for maintaining the machine as well as a number of smaller costs for storing the money and communicating with your bank. Because of that, they're not easy to get around. Instead, the best option is to use ATM locator tools or apps such as ATM Fee Saver or MoneyPass ATM Locator to easily locate ATMs with no or low withdrawal fees and avoid hidden costs. When using these apps, you can use GPS to show nearby ATMs and specify filters for those that don't have any additional fees or have partnerships with your bank. Don't forget to notify your bank before you travel to avoid card blocking and be able to use your cards with ease abroad.

The first thing to do before you travel is to research your bank's policies for travelers and check if they have partnerships with global banks that waive fees or have a Global ATM Alliance. This will help you identify specific banks to use their ATMs to ensure that no extra charges will be added. For example, Bank of America partners with a number of international banking institutions, as well as Barclays United Kingdom as well as Scotiabank in Canada, Mexico, and the Caribbean.

Some banks do not charge international ATM withdrawal costs such as HSBC, as it has its own ATMs abroad with no withdrawal or foreign transaction fees when using them. The Schwab Bank High Yield Investor Checking account offers unlimited fee reimbursements abroad and doesn't charge any foreign transaction fees. Other cards such as the Capital One Venture Card and Chase Sapphire Preferred have no foreign transaction fees as well as travel rewards and perks.

The other alternative is to obtain a fee-free debit or credit card that does not have any foreign transaction fees. These cards are designed specifically to make it easy to use multiple currencies with low or no fees. This makes it possible for frequent travelers to switch from one currency to another with minimal costs and, in some cases, they eliminate ATM withdrawal fees. When using these cards, the 1-3% fee for every transaction made in a foreign currency is waived as well as the fee of $3-$5 per international ATM withdrawal. Virtual cards such as Revolut and Wise are very easy to set up and allow easy transfers from one currency to another with minimal conversion rates. However, there might be limits to the amounts you can withdraw per month internationally as Wise has an ATM Withdrawal limit of $100 each month for free.

When choosing an ATM to withdraw money in the local currency, there are certain places you should always avoid. Thrifty travelers know to avoid airport ATMs and exchange bureaus, which will most likely incur higher fees. Instead, look for ATMs at major banks, as they tend to have lower costs. One major important tip is to avoid Dynamic Currency Conversion (DCC); when opting for DCC, the ATM provider will convert the purchase amount to your home currency at a ridiculously high exchange rate, adding 3% to 7% in fees. If you think converting the transaction to U.S. dollars avoids the foreign transaction fee, you're in for a surprise. Institutions will still charge this fee, so you're better off withdrawing money in the local currency to save on total incurred charges.

Remember to always check the fee disclosure on the ATM screen before confirming the transaction to avoid hidden fees. If you're unable to find an ATM near you with no transaction fees, the smartest thing to do would be to withdraw larger amounts of cash each time to help save on transaction expenses that are calculated per use. Just remember to use a money belt such as this Vantamo Money Belt for Travel to keep your cash safe from pickpockets. Practice caution to avoid shoulder surfers and avoid becoming a victim of ATM scams. For extra caution, consider using a unique type of wallet such as this Buffway RFID Blocking Leather Wallet to prevent theft and scams abroad.