Travel disasters and your credit card

Financial experts often recommend traveling with your credit card – not your debit card – along with some cash. It’s important to note that not all countries are as card-savvy as others and in some places cash is the only way to go. Either way, traveling without a credit card can spell disaster, and here is why:

1. If you get sick, your credit card can speed treatment. If you’ve purchased a travel insurance plan with travel medical coverage, sometimes that travel insurance company will guarantee payments to the medical facility to get your treatment moving along, but if not, your credit card will and you can later claim reimbursement from the travel insurance company, depending on the circumstances and your policy’s description of coverage. If your travel medical coverage is secondary to your home health insurance (this is especially true if traveling within your home country), then your credit card can fill the gaps until you can make a claim on your travel insurance policy.
2. If your wallet is stolen, only the credit cards can be easily replaced. If you’re mugged on the streets of Italy, your first call should be to the local authorities, but your second to the bank issuing your credit card. The best credit card companies will send you a replacement via your lodging address and make sure you are safe for returning home or continuing your trip – that’s part of their customer service. With a debit card, if you contact the bank quickly (typically within 2 days is required), you may get the money the thieves cleaned out of your account back, but you won’t see it the next business day. This could mean sleeping on a park bench for a night or two.
3. If you’re making foreign purchases, the credit card exchange rates are better. True many credit cards charge you a foreign transaction fee, but it’s still usually cheaper to pay the fees than to convert U.S. dollars to foreign currency because the credit card purchases are exchanged on the interbank exchange rate and currency exchanges are out to make a profit.