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AAA offered pre-paid Visa to replace the old fashioned Traveler's Checks

I'm wondering if anyone has had experience buying and using a pre-paid Visa card offered by AAA. There are very nominal fees associated with using it, the card can be used just like your bank debit card for purchases and cash withdrawals at ATMs, and most importantly, if lost or stolen will be quickly replaced with your unspent balance from the lost/stolen card transferred to the new card. Balances can be checked online and cards reloaded with additional cash online.

This card seems to offer the security of the old fashioned traveler's checks with the convenience of a Visa debit card. Does anyone have experience using such a card from the AAA?

I have a 4-week trip to Europe coming up very soon, where I will be living on my debit card 98% of the time, using credit cards only sparingly due to interest rates. I have been concerned about exposing my "everyday use" bank debit card (and the account associated with it) to perhaps less secure locations than I'm used to at home here in the US. This AAA card may be the a good option - credit/debit card convenience, fees no more expensive than normal bankcard fees, and the security of replacement card with available funds within 72 hours.

Anyone tried this financial instrument? Good or bad idea? All input welcome!

Posted by
2525 posts

Read Rick's advice and perform a search on the Travel Forum for extended discussions. If you sleep better using a pre-paid card, then happily go forth and forget advice from crusty folks (like me) that advise to use a a debit/ATM card and credit card. Both of mine have no surcharges.

Posted by
3451 posts

We have used a separate account ATM card for several years that's not tied to our checking/savings account. This separate account card doesn't have our name imprinted on it and no ties to a credit card - no logos. So, if it's lost or stolen, it's worthless to anyone else. We have no charges with its usage, similar to your ATM debit card. I would check if your bank offers something similar.

By the way, I do bring one back-up credit card "just in case" but have never used it. And, since you're wanting to reduce risk, be sure to wear a money belt.

Enjoy your trip!

Posted by
3428 posts

"Very nominal fees" "no more expensive than normal bankcard fees" Ha ha! Had to laugh, sorry, couldn't help myself. :-)

Seriously though. Read the reviews on the web about this product. Get a complete fee listing from AAA before you buy anything (the fact that this information is not readily shared by AAA openly on the internet should be cause for concern). See how that compares to your normal debit card. If you still feel what they charge for each and every little thing you do with this card (like a 7% fee for any purchase) is "nominal" then go ahead and get it. If this card charges less than your normal debit card overall, it is time to change banks! My bank charges zero fees for any debit card transaction anywhere in the world and gives me the Google rate for foreign exchange, meaning it really costs me nothing to use it. Look around for a bank you would like to use that has a similar debit card policy. It could save you a lot in your travel expenses.

You will find that in Europe (or at least I always have), most businesses will still be a lot happier with cash and not debit or credit transactions. I have had many smaller shops simply refuse my cards or state there is a high minimum purchase required. My suggestion is to use your debit card to get cash from bank operated ATMs and pay for everything except hotels and transportation with cash. Less exposure of your debit card that way.

Posted by
7180 posts

Serious EYE-ROLL here. Just get an ATM card like everybody else. Forget those silly pre-paid, pre-loaded, traveler cheques in disguise crap and forget about it. We take students all over Europe every summer and the ONLY atm card that consistently gives problems are those pre-loaded junk cards. Pains in the rear, hidden fees, etc. Can check the balance online??? Really! Novel idea ;-\

AAA has finally figured out they can't seriously unload those silly outdated traveler's cheques any longer so they look for some new hocus-pocus gadget to pawn off on unknowing travelers. They gotta make money SOME way. Heaven knows they can't make it on their own travel agents who know less about travel than 99% of the people on these travel forums.

Posted by
20688 posts

A couple of years ago when I finally found all fees that were charged the nominal fees can close to 10%. We have frequently stated on this site that the cheapest and most convenient way to obtain local currency is via a debit card at a bank owned ATM. If your debit card is no fees, that is even better. Even if your debit cards charges a fairly standard 3% it is still cheaper than anything else.

How is the security of the pre-paid improved over a debit card? Pre-card cards are considered gift cards and therefore are not regulated by the banking codes. You have far less protection and security with a pre-card. Old fashion traveler checks were never that secure and had their own share of problems. Seventy-two hours is three days. What do you do for three days waiting for your money. Carry two debit cards tied to two different accounts. If one card is lost, stolen, doesn't work, you fall back on the second card. If the pre-paid card is lost, what is the fall back option?

Stick with a good, old fashion, well used debit card. Don't leave home without it.

Posted by
14 posts

As a business owner I would like to add that a lot of places refuse to accept these type of cards because of the high processing fee that the business has to pay for accepting this type of cards.

Posted by
516 posts

Similar to using any such cards/products/services, always question what is the support, accountability, and recourse should things go wrong. Traditional credit cards have 24/7 monitoring of your account, fraud detection, and you can call them 24/7 to cancel a card or report a loss and have them send you a replacement card. In other recent postings here, I've seen things go wrong with travel agents (whether online or physical agency/office/person) booking bad flights or impossible to make connections. Similary, in those situations, what is the recourse. If the agency is a small office open only from 9AM-5PM Mon-Fri, who do you call when your find they booked you on a wrong flight and it's a Saturday night.

Posted by
7 posts

As far as I can tell, the higher fees were on a previous generation of the AAA card. Transaction fees are listed as 3% with the exchange rate calculated by the VISA network, unless I am missing something. There is a reload fee and a purchase fee, but if it makes the OP more comfortable to use it that way, then they should. A month long trip is very expensive, as it is, and peace of mind is worth every penny.

Just my opinion, anyway :)

Posted by
9363 posts

My peace of mind is worth every penny, too, which is why I carry a regular ATM/debit card from my credit union (0%), as well as one from an online bank (1%) - no purchase fees, no reload fees, and I can transfer money between them. My debit card transactions are as protected as credit card transactions, and I have no worries about using them in ATMs anywhere. There is no benefit to a prepaid card of any kind. The OP was asking whether a prepaid card was a good idea or not. Seems like most of us believe it's a bad one.

Posted by
2525 posts

Check ALL fees/costs of the pre-paid card and compare to a debit/ATM card that offers no foreign transaction fees such as many posters have in hand, me included. Very few, at best, of us that travel to Europe (and elsewhere internationally) at least annually use a pre-paid card or would recommend same to a person flying to Europe for the first time. Costs aside, what's the benefit over a "good" debit/ATM card?

Posted by
12120 posts

Hi,

I would not bother with these pre-paid cards, not worth it. In the old days I used Amer. Ex TC just like everyone else, never had a problem cashing them at various banks in (West) Germany charging various amounts in DM as commission. I wanted the receipts as souvenirs. True that some places require a min. purchase amount before your US credit card is accepted, even at restaurants, which I've encountered in France. Use cash and a credit card to make the purchases. Even when cash is preferred usually in Austria and Germany, I look for the Visa logo on the restaurant window prior to entering, in case I decide to pay with the card.

In terms of security or peace of mind, I don't allow my pocket cash reserve to drop below rock bottom 20-30 Euro, as long as I don't have to check out and pay the lump sum. Your credit card should tie you over. Not every card you bring with you can be blocked.

Posted by
2978 posts

I didn't want to use my regular checking account for ATM use in Europe either. I opened a Charles Schwab investor checking account to use specifically for travel. There are no foreign transaction fees charges and no ATM fees charged when using the debit card at ATM's in Europe. It worked perfectly for me this summer.

You do need to open an investing account as well, but you are not required to put any money in it. So I have $0 in the investing account, and my travel fund in the checking account. It also helps make it a little easier as I am saving for my next trip. I just put all travel funds into this account.

Posted by
20688 posts

OK, Carol, we get the point.

Posted by
6067 posts

Easy Frank, I doubt that the formatting issue was intentional. Stuff happens.

Posted by
2978 posts

Thank you, it was an unintentional formatting issue.

Posted by
4506 posts

A pre-paid card can be a good option for those without or unable to get a credit card. But I wonder, why would anyone else need one?

You mention security. But a credit card is just as secure, if not more so. If your card is lost or stolen, you will be issued a new one and are not liable for any charges ($50 max and it is never charged). A debit card offers similar protections but can be more risky in that it is tied to your bank account and funds can be temporarily depleted until the issue is resolved. For those reasons, most of us don't recommend using a debit card for purchases while traveling abroad. And a debit card won't always work for purchases abroad. (Note this advice is for purchases, not cash withdrawls).

You mention interest rates. Using a credit card doesn't incur interest charges unless you already have a balance. If you do have a balance, I recommend you pay it off before traveling.

If you are looking to use mostly cash, then your debit card is the best way to go. There are other, no fee accounts you can get too that would be a much better value and offer fraud protection too. Using an ATM is extremely secure, especially if you take basic precautions. Never allow anyone to see you enter your PIN and keep your card and cash secure with a moneybelt, neck pouch, belt wallet or travel purse.

Posted by
17683 posts

I believe each AAA club is independent and can arrange for cards from any foreign currency operation, so check the small print from your club. At one time my local AAA club was using Travelex, which converted the prepaid dollars to euro at 10% before loading the card. After that, there was only a small fixed fee to withdraw from the ATM, but they already socked you good for the currency conversion.

If you are really worried about the security, open a checking account and only put in it what you would put in the prepaid card (but make sure you decline overdraft protection).

Posted by
285 posts

Thanks to everyone for all the good advice.

I decided to open a Capital One 360 account to use for this trip, so I can insulate my "everyday" debit card from exposure to any potential problems. Two added bonuses of the Cap One card -- no foreign transaction fees AND it's a chip and pin card, so there will be no issues with use in Europe.