Why you should care about a travel credit or PrePaid card
It’s no secret that as digital nomads, we travel a lot and our lifestyle is extremely dynamic and international. This can come at a high cost if we don’t keep an eye on our expenses and all the fees that come with the traveling lifestyle. How many times were you surprised when you saw the bank fee or the withdrawal fee from the ATM? How about those times when you received money from a client in a different currency and you got charged for that? Luckily, there are ways to minimize these costs by having with you either credit cards or prepaid cards which come with many more other benefits.
Travel cards not only can save you a lot of money and help you manage your finances on the go but also they also come with a lot of nice perks that do matter, especially during travels.
Free flights, airport lounges, and accumulated points that can be used in stores are only a few advantages of using a travel card during passages around the world. For example, some of the prepaid cards like Revolut can send you a new card anywhere in the world in a matter of days if your card gets lost or stolen.
Or how about those expensive ATM withdrawal fees? Wouldn’t it be nice to save on them and use the money to see more of this beautiful world? Of course, it would, that’s why travel cards are a must-have tool in the arsenal of any remote worker or frequent traveler.
Let’s explore the best credit cards and pre-paid cards for digital nomads and hardcore travelers below.
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Why you should avoid using a normal credit and debit card abroad
Most credit and debit cards let you spend abroad, but will charge you for this something called a “foreign transaction fee“.
Although your card provider offers you very competitive rates, it usually adds a fee that will come back at you the more you use the card.
On top of this, many debit cards charge a flat fee (e.g. 50p-£/$1.50) each and every time you spend overseas, regardless of the amount. Withdrawing cash usually attracts fees and unavoidable unfortunately interest on credit cards. If you don’t use these types of cards, you will be spending a lot of money on fees and exchange rates that are completely avoidable otherwise.
But don’t worry, there are ways around these fees.
The specialist travel cards don’t charge these fees, so you get almost identical rates from your bank when your transaction goes through.
You will see the rate a few days after the transaction when the account settles so you won’t know the exact rate you’re getting at the time. However, usually, the rates offered are good so you can trust the credit card companies.
Moreover, with the prepaid travel cards, the exchange rate is very transparent and the transaction shows up immediately in your app. And you can always transfer money between international currency accounts and gain perks whilst using these apps.
What is a travel card and what are its Benefits?
Travel cards can come in 2 different flavors, each with its own PROs and CONs. Let’s see what they have to offer in the paragraphs below.
- Credit Cards for Travel
This acts like your typical credit card except they are specifically tailored for international payments and ideal for digital nomads.
On top of that, most of them will give you travel perks like travel insurance, mile rewards, lounge access, and more.
One thing you must consider when applying for a travel credit card is that usually, the company will do a background check on your financial history and credit score.
So you want to make sure that your credit score is good enough when you apply otherwise a rejection will look bad on your score later on.
You should always pay your card in full at the end of the month because the interest rate is usually very high with these cards. Travel credit cards are a good opportunity for you to build credit history and show the banks you are a good payer for future loans.
2. Prepaid Cards for Travel
Prepaid Cards have become very popular in the last few years, mostly due to the digital transformation of banks and more people from emerging countries. entering the banking system
Another great thing about prepaid travel cards is that you don’t have to pass any credit or history checks. What you see is what you get and in a lot of cases, the fee to get a card is minimal (a few dollars).
If your card gets lost or stolen, most companies will send you the card wherever you are in the world for a small fee. You got to love this.
Cheap or free ATM withdrawals
If you use an ATM abroad, you’ll usually be charged a fee and interest from the moment the money’s withdrawn. Travel cards may waive this fee
Travel rewards
and more
Some travel credit cards offer benefits to customers who travel frequently. These include discounts on travel insurance or reward points for flights
No spending fee
Most credit cards apply a flat fee of around 3% every time you use them abroad. Travel cards won’t charge or will have a low fee, instantly saving you a hefty sum
Better exchange rates
Exchange rates are one of the hidden dangers of spending on plastic when you are abroad. Travel cards usually aim to have better rates
Top Travel Credit And Prepaid Cards On The Market
This is a great choice because it charges no fees or interest on spending AND overseas cash withdrawals repaid in full.
It comes with cool perks – you get 0.25% cashback on almost all spending & it also gives five months free access to to Apple Music, Apple Arcade, Apple News+ and/or Apple TV+.
- UK only
- No fees on spending or ATM withdrawals overseas
- 22.9% rep APR
- No interest on cash withdrawals if paid IN FULL
- 0.25% cashback on most spending
With this card, you can earn rewards — known as Ultimate Rewards points — in a variety of ways and redeem them for travel e.g. transfer them to other programs like United Airlines or Hyatt.
There is a cool sign-up bonus of 80,000 points after you spend $4,000 on purchases in the first 3 months from account opening. That’s $1,000 when you redeem through Chase Ultimate Rewards.
5 points per $1 spent on all travel purchased through Chase Ultimate Rewards.
3 points per $1 spent on dining (including eligible delivery services and takeout).
3 points per $1 spent on select streaming services.
3 points per $1 spent on online grocery purchases (not including Target, Walmart and wholesale clubs).
2 points per $1 spent on travel not purchased through Chase Ultimate Rewards.
1 point per $1 spent on other purchases.
- Apply in US only
- Annual fee $95
- No foreign transaction fees
- Transfer your miles to your choice of 15+ travel loyalty programs
- Earn 5X miles on hotels and rental cars booked through Capital One Trave
- 16.24%-24.24% Variable APR
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With this travel card, you’ll get a one-time bonus of 60,000 miles once you spend $3,000 on purchases within 3 months from account opening, equal to $600 in travel.
You will also earn unlimited 2X miles on every purchase, every day. No expiration on the miles for the life of the account and no limit to how many you can earn
Moreover, earn 5X miles on hotels and rental cars booked through Capital One Travel, where you’ll get Capital One’s best prices on thousands of trip options
Use your miles to get reimbursed for any travel purchase—or redeem by booking a trip through Capital One Travel.
Use the miles accumulated with 15+ travel loyalty program partnerships.
- Annual fee $95
- Apply in US only
- High rewards rate
- Flexible rewards redemption
- A generous sign-up bonus
- Transfer miles to partners
Revolut is a digital bank that started back in 2015 as a travel card providing cheap rates but has now evolved into a bank and investment instrument.
This fast-growing bank which has obtained its banking license in 10 European markets offers a wide range of features. Anything from money exchange, travel insurance, and even investments in gold and cryptocurrencies.
Customers in Belgium, Denmark, Finland, Germany, Iceland, Lichtenstein, Luxembourg, Netherlands, Spain, and Sweden who upgrade to Revolut Bank for additional services will now have their deposits protected under the deposit guarantee scheme. Deposit protection up to EUR 100,000 is guaranteed.
Account opening is free and maintaining your account is also free, with no monthly cost. The app on Android or iPhone is probably the best in the market, with great UX and UI.
Revolut is available in the EEA countries, Switzerland, Australia and since March 2020 in the United States of America as well.
Current accounts are available in 28 currencies: AED, AUD, BGN, CAD, CHF, CZK, GBP, HKD, HRK, ILS, ISK, JPY, MAD, MXN, NOK, NZD, PLN, QAR, RON, RSD, RUB, SAR, SEK, SGD, THB, TRY, USD, ZAR.
Revolut cards are available from Mastercard and Visa. You can’t pick your preference, so which one you’ll get is going to be random.
Due to its international features and travel perks, this is probably the best card for digital nomads.
- €/£200 /month free, 2% after
- Free International transfer (SWIFT)
- International curency exchange 0.5-2.0% on weekends €6,000/£5,000 /month free, additional 0.5% after
- Virtual cards available
- Travel insurance, Aiport Lounges, Gadget insurance for Higher Tier Memberships
- Crypto, Stock Trading Available
- Banking license and protection in some countries
Starling Bank (Prepaid)
Starling Bank offers a full UK current account that can be opened and managed directly from the app. It aims to make banking easier and more customer-centric and make your finances accessible to you wherever you are.
When you sign up, you get a current account, a debit card, and an app that’s all about helping you understand where your money goes, budget, and save.
You can also keep your money safe on the fly, by restricting the way your card can be used and deactivating the card at the touch of a button.
Starling is covered by the Financial Services Compensation Scheme (FSCS) so you would be protected for up to £85,000.
A cool feature of the app is “Spending Insights” which allows you to see a breakdown of your account, automatically separated into categories so you can see where you might be overspending. You can even attach receipts, photos, or notes to individual transactions to help you keep in control of payments.
- Free to open account
- No ATM withdrawal fee free abroad
- Personal or joint account
- Fee for sending money abroad
- Spending Insights in App
- Overdraft available
- Interest of up to 0.5% from your balance
- Virtual cards available
- 0.4% to send money abroad.
- £60 fee for card lost abroad
With a lot of money transfer companies trying to hide fees and exchange rate markups, the Wise travel card comes as a great solution to this issue .
The Debit card by Wise (formally known as TransferWise) is attached to your Borderless Account and can be used to make purchases internationally. It’s just like having a local card in overseas locations.
You can top it up by Credit card, Debit card or Bank transfer.
You can add money to your account in 21 currencies: AUD, BGN, BRL, CAD, CHF, CZK, DKK, EUR, GBP, HRK, HUF, JPY, MYR, NOK, NZD, PLN, RON, SEK, SGD, TRY and USD and you can keep 50+ currencies in your account.
It makes it easier to spend money internationally, even if you don’t have the currency you need in your account.
The Wise card can be used throughout the MasterCard network and enables multiple currency access either online or while traveling.
The card uses the mid-market rate for transfers. Its rates are updated multiple times a day, but Wise also allows you to lock in a rate for a day or more to complete your transfer.
- Borderless account available in Europe,UK, Australia, United States. Card only in UK and Europe
- $0 international ATM fees up to £200 /month
- Free to order, but must deposit $20 when you first open the account to verify identity
- Charge it with a debit card, credit card or bank account with ACH or wire transfer
- Better exchange rates than banks almost always
- High daily sending limits cap of £1,000,000 per transfer is in place, subject to location
The cryptocurrency market has taken the world by storm and a lot of people across the world now hold some type of digital currency.
In order for people to spend their crypto money in the real-world, crypto cards are flooding the market.
Self-proclaimed as the most widely accepted card in crypto and with extraordinary marketing and partnerships, the Crypto.com Rewards Visa offers its users a convenient way to use funds while also offering some nice perks.
Crypto.com “travel” card supports dozens of different cryptocurrencies, and to avoid market fluctuations, the chosen crypto coin is converted to USD based on the real-time market value and then loaded to the Crypto.com Rewards Visa.
The Crypto.com Rewards Visa card runs on the Visa processing network and therefore is accepted by all retailers that take Visa as payment, which means that the card is accepted at millions of locations worldwide.
Crypto.com supports dozens of different cryptocurrencies, and to avoid market fluctuations, the chosen crypto coin is converted to USD based on the real-time market value and then loaded to the Crypto.com Rewards Visa.
It can then be used like any other form of payment card because it runs on the Visa processing network and therefore is accepted by all retailers that take Visa as payment, meaning that the card is accepted at millions of locations worldwide
- Fee-free ATM withdrawals bet £190-£900 depending on tier
- No credit check required
- Free Netflix and Spotify for higher tiers
- Earn up to 5% cashback
- Airport lounge access - Unlimited lounge access with Loungekey
- Option to monetize staking of crypto currency in app
Started in 2012, Coinbase is probably the most popular cryptocurrency that has onboarded millions of people into the crypto market.
This Coinbase prepaid card provides a solution to those looking to do just that — allowing you to spend the USD value of your crypto and receive rewards for doing so.
Originally started as a cryptocurrency wallet and trading platform, Coinbase offers now the opportunity to trade 35+.cryptocurrencies.
- Up to 4% back in your choice of crypto
- Ear rewards in multiple crypto assets (staking) bet 2-5% APY
- Free to order, but must deposit $20 when you first open the account to verify identity
- Charge it with a debit card, credit card or bank account with ACH or wire transfer
- Better exchange rates than banks almost always
- 2.49% transaction fee when converting asset to dollars when for purchases
Travel Cards Must Knows
Travel credit cards can save you a lot of money abroad, however they can turn into a nightmare and a lot of loss if you cannot pay them off in time and interest kicks in. To make sure you don’t lose money, set up a direct debit to repay in full every month, or the interest charges will start biting.
If you’ve a top overseas credit card, spending is almost always cheaper. Even on cards with no cash withdrawal fees, you’ll usually still pay interest on the withdrawal until you pay it off.
If you’re going to get the cash out on a specialist overseas card, then it’s better to wait until you’re there.
However, if you’re just planning to use a normal card or convert pounds when you’re out there, there’s no guarantee you’ll get a better rate – and certainly changing in most hotels is normally a bad idea as they give poor rates.
Any cash withdrawals you make on a credit card will be recorded at the credit reference agencies. On their own, they shouldn’t matter too much, but if you have a history of poor credit, or you’re looking to make an important credit application soon, they’re best avoided.
Because it’s usually quite expensive to withdraw cash on a credit card, lenders may see it as you being desperate for cash, and will count it against you if you apply to them.
You will most likely be asked by hotels and shops abroad what currency you want to pay in. If you choose dollars or pounds, the retailer does the currency conversion – but at poorer rates compared the ones from your card provide.
If are using a travel card, ALWAYS choose to pay in the local currency, as your card does the exchange and it will be at a very good rate.
When you spend abroad, your bank gets a very good rate when it does the exchange for you. It will exchange the money at Mastercard’s or Visa’s wholesale rate, which are pretty close to the spot rate that the currency markets suggest
Visa usually has a slightly better exchange rate but the differences were very small, so it’s hard to call a winner long-term. You shouldn’t stress about it.
In the UK, most banks will charge you a non-sterling fee up-to-3% if you are not using one of these specialist credit cards.
Other Great Resources on Travel Cards
With so many offers on the market, it can be quite tricky to find the right travel card for you that ticks all the boxes. As travelers and remote workers, we have different needs and preferences so sticking to a card might not be the best option. Instead, you can own many and use them according to your circumstances.
Here are a few more resources to help you decide faster in case this article was not enough.
- Reddit “How to choose a card”
- Reddit Travel Card Recommendations Channel
- The famous Moneysavingexpert (UK only)
- Nerdwallet.com
