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The best travel DEBIT cards??? Why would you even need a debit card if there’s plenty of attractive credit cards out there? Isn’t using a debit card while traveling risky?
So the travel hacking hobby involves earning a bunch of points and miles in order to book flights and hotels instead of spending cash. Where does having a travel debit card fit into the equation? Well sometimes you just need cash while you’re out on vacation. Whether it’s to tip, or if you’re at a market that only accepts cash, you’ll need a convenient and inexpensive way to pull cash.
TYPICAL DEBIT CARDS
More than likely you already have a debit card from your bank. The problem with using that debit card abroad is that most banks will charge you an out of network fee and a foreign transaction fee. The out of network fee is where you’re not using an ATM associated with that bank. So let’s say that you have a debit card from Wells Fargo, you’ll be charged for using that debit card at an ATM that doesn’t belong to Wells Fargo. Good luck trying to find a Wells Fargo ATM in Southeast Asia.
Now you might be thinking, “I can just take cash from home and exchange it at my destination…” or “I can just buy foreign currency from my bank…”. While that is true, I wouldn’t advise doing that for a couple of reasons. First, it’s not wise to carry a bunch of cash on you while you’re on vacation. It could easily get lost or stolen. The second reason is that you get poor exchange rates at your bank or at your destination. You may also get charged an exchange fee on top of that. If you pull cash from an ATM at your destination, you get top exchange rates from Visa, Mastercard or American Express, depending on who your debit card goes through.
Typical debit cards will also charge you a foreign transaction fee for using the card outside of the US. Whether it’s at an ATM or making a purchase at a store, you may get hit with these fees and they really add up. A travel debit card can help you avoid the foreign transaction fees and the out of network fees.
RECOMMENDED TRAVEL DEBIT CARD
These cards aren’t necessarily advertised as travel debit cards, but many people use them while traveling because they don’t charge you foreign transaction fees and you’re reimbursed any ATM fees you incur.
The first one I recommend is the SoFi Money Account. By using this link, you’ll get $25 by funding your new account with $100. I get $25 too. You don’t have to use this link, but it’s greatly appreciated if you do. This cash management account is basically like a checking account and currently earns 1.60% interest.
I enjoy this account as it’s very convenient and helps save me money when using it abroad. This isn’t my primary bank account. I use a local bank for my everyday finances. When we’re getting ready for a trip, I transfer cash from my primary account to my SoFi account to use while on vacation. This way if my SoFi debit card is lost or stolen, thieves don’t have access to my primary funds. You can do the same if you open up an account.
UPDATE: SoFi recently changed their promotion for SoFi Invest. They now require you to fund your account with $5K instead of $1K to earn the bonus.
SoFi also offers other products that are very appealing as well, such as their investing platforms. They offer active investing and automatic investing with fractional shares. Their SoFi Invest account doesn’t charge you trade commissions when buying stocks and etfs. If you choose to open an investment account with this link, you’ll get $100 in stock and so will I if you fund your account with $1000. In my opinion this is a better promotional offer than what is offered by Robinhood or WeBull because you get $100 worth of your favorite stock, as opposed to getting free random stocks.
ANOTHER GREAT OPTION
The other debit card that I recommend is from Charles Schwab. This account has been around for a while and like the SoFi account, it doesn’t charge you foreign transaction fees and reimburses you ATM fees. I’ve had this account for years and I’m happy with it, but I’ve been using my SoFi account more lately because it earns 1.60% interest, while Charles Schwab offers only .15% interest.
With Charles Schwab you also have access to a brokerage account for active investing with zero commission trades on stocks and etfs. Soon they will be offering fractional investing as well.
Like I said, I’ve used this account for years and have been happy with it. I give the slight edge to SoFi due to the more favorable interest rates and promotional offers.
CONCLUSION
While you may already have your preferred bank for everyday needs, getting one of these travel debit cards certainly doesn’t hurt. By transferring your vacation money to either your SoFi or Charles Schwab account, you’ll have fee free access to cash while you’re on vacation. I’m sure you can find better use for that money instead of paying fees. Do you have a preferred account to use while you travel? If so, post your referral links below.
