Traveler's Check, Cash or Credit Card?

(I have been asked many times questions about how to travel wisely especially about things to bring, hotel stay, places to visit and ground transportation etc.  I will write a series of these things and post them periodically with all my other stories here in this blog. Enjoy the read.  If you have things you want to know about traveling, do write in to me and I will provide the answers through my traveling experience....... not from what you get in travel guides.  Well.... the guidebooks are all great, I just prefer to travel with my open heart ... and an open mind.)

Question :

When you travel, is it better to bring cash in local currency, Traveler's Check or Credit Card?

Answer :

I travel using Credit Cards and a little cash in local currency.  

However, how much cash you need depends on which country you will be visiting and where you go.  If you are going to Nepal and trek the Annapurna Range, then credit cards are useless.  In South Africa though, credit cards are used wherever you are, even to the National Parks and when you pay for your trekkings, they all accept credit cards for any amount.

My first backpacking experience was to New Zealand via Melbourne and en route Sydney.  It was about 20 years ago.  Credit cards were not issued that easily then.  But Traveler's Check was the most raved about international exchange document.  The setback was I need to pay commission when I buy the Traveler's Check and pay again another commission when I en-cash the checks.  There are banks who don't charge commission for en-cashing the checks, I just got to look out for them.  It was not so much of a problem, the main reason I stopped using Traveler's Checks after my first backpacking experience was because .....I had hard time trying to sign on so many pieces of the checks when I could not move my fingers, they were so numbed in winter, I can't move the strokes to sign my name.

That was the first and the last time I ever carried with me Traveler's Checks.

Credit Cards are still the best money exchange tool, why?

• they are save and easy to carry;
• they are accepted worldwide;
• you can use first then pay later;
• exchange rate is sometimes better than the rates you get from the foreign country;
• high credit limit so you don't have to worry if you need more cash than you budgeted;
• you can get cash when you have finished with the local currency and you don't have other available currency to exchange, you can fall back easily on your reliable plastic;
• you can en-cash it easily, just produce it to a bank officer and he will give you cash without charging a commission** (but you will need to pay finance charges to your issuing bank);
• it saves you from exchanging too much local currency where you don't use when you come home (imagine having too much Laos kip or Vietnam dong or Kenyan shilings).

**I was in Cairo and I had used up my Egyptian pound.  I was alone. I wanted an early flight home but all flights were full.  So, I had to stay in Cairo for a few more days.  And my credit card got me the cash at the same exchange rate, no commission.

**I was in Sri Lanka and spent all my Sri Lankan Rupees, because I did not know that I need to pay airport tax.  I took it for granted that the airport tax was already paid with my flight ticket.  I did not have US Dollars and to my horror, that was the day when Malaysian Ringgit was suspended for forex trading, remember that day in 1997? I can't pay my airport tax, which means I can't get on my flight.  And you know what saved the day?  I en-cashed my credit card.  Long live the plastic...

Important note :

Please call your issuing bank and let them know where you will be with your credit cards and how long will you be staying there.  Always do this before you travel, and you will be rest assured of your payment going through once your cards are swiped.