If you are going abroad, you may be planning to use your VISA or Mastercard debit card to pay for your purchases and to withdraw foreign currency during your trip.
Unfortunately, almost every single bank charges a 2-3% commission on such withdrawals. You won’t see it in your statement, since it’s hidden in the foreign exchange rate they use to convert your withdrawal into US dollar equivalent. For example, if the market rate is Japanese Yen (JPY) 100 to $1, most banks will convert your JPY purchase to U.S. Dollar at the rate of JPY 97 to $1– and they won’t even mention the market rate.
The only way to avoid this extra fee is to carry one of the very few debit cards that don’t impose such a fee. At this time (July 2009), one of the best choices is Citigold interest checking account. The benefits are very clear:
- Pay no commission on foreign currency transactions
- ThankYou points for any debit card transactions
- Discounts on outgoing wire transfers
- Special dedicated customer support line
- Slightly higher interest rates (but don’t compare them to teaser rates from internet banks)
- Free of charge reward credit cards (such as Citi Aadvantage credit card that accrues American Airlines miles)
You can open an account with just $500. However, the downside is you have to pay $25 per month unless you maintain $100,000 in your various Citi accounts. However, if you go abroad at least three-four times a year, the foreign exchange savings alone will cover the fees.
The information presented in this article was accurate at the time of publication but may have changed since. Visit our Checking Accounts page for the most up-to-date checking account rates, information and news.
