As the holidays approach, many people hit the road for vacations. Whether you are planning a cross-country road trip or are flying to foreign lands, using a credit card can make paying for your travel expenses a lot easier than if you used cash. But if the possibility of going over budget has you cringing, remember the benefits of using a credit card for travel and put a spending strategy in place before you leave.
Hotel and Airfare Reservations
Benefit - Reservations are easier with credit cards: Generally speaking, when you make a reservation for a hotel or plane ticket, you are asked to provide a credit card number. Even if you plan to pay cash when you arrive at a hotel, a credit card is usually required to hold your room. Once you arrive at your destination, however, you can pay with cash (although you may be asked to pay the full amount when you sign in). You can also pay for plane tickets with cash at the airport, but you may be subjected to additional security checks.
Strategy - Use a travel agent: A travel agent can book all your reservations for you so that you can pay (credit or cash) for the bulk of your trip at once, ensuring you stay within your budget.
Credit Card Use Abroad
Benefit - Currency conversion is easier with credit cards: Eliminating the problem of converting cash into foreign currencies is another reason credit cards can be very useful when traveling abroad. But there are fees associated with this service, so it is important to find out what type of currency conversion or transaction fees are involved with your credit card. Make sure your credit card is accepted at a variety of businesses in the country you plan to visit.Strategy - Use a credit card specifically designed for foreign travel: That way you can avoid many of the currency conversion and transaction fees that banks naturally assess.