This will be our first time traveling to Europe and are curious if we should get cash prior to leaving the US or wait and use ATM once we arrive? We will be visiting both Switzerland and Italy so I assume that we will need to get both Franc and Euro? I originally thought we could primarily use our cards but found out today that we will pay a 3% charge each time so cash will be the best method.
Thanks!!!
3% charge each time what? Each time you withdraw cash from an ATM or each time you charge on your credit card. Either way - open up a credit union account for yourself where the fees will be minimal (probably even zero) from withdrawing cash with your ATM card.
If you're talking about a 3% foreign transaction fee each time you use your credit card then get a different credit card. Capital One charges 0% foreign transaction fee.
Some people, especially first time travellers, like to have 1 to 2 days supply of cash on them when they arrive in a new country, so they aren't dependent on finding a cash machine (ATM) at the airport. Thereafter use a cash machine.
If you are getting charged 3% to use a credit card, or your debit card in a cash machine, you can be sure that changing cash before you leave will cost you even more (5%+). But the markup may be hidden in the exchange rate.
" especially first time travellers, like to have 1 to 2 days supply of cash on them when they arrive "
I'd say especially experienced travelers. One my first trip to Europe, I had no local currency when I arrived. Those were the day's of Traveler's Checks, and we exchanged them for Belgian Francs at the airport. Today, I have a couple day's worth of cash when I arrived, brought back from my last trip.
Most banks that charge 3% for ATM withdrawal also charge a $5 fee, which, on a $500 withdrawal makes it ~4%.
And I wouldn't rely on getting a credit card with free use in Europe. The EU just passed a law limiting the charge to merchants to 3/10% for credit card use. Since they won't be getting much from the merchants, I expect them to start charging us more. Capjital One has been using the 0% on credit card use to encourage you to use their card because they got a lot from the merchant.
"Some people, especially first time travellers, like to have 1 to 2 days supply of cash on them"
I agree with Lee on this one. Even experienced travellers like to have cash on hand to pay for incidentals during the trip. I always have money left over from previous trips, so have enough to last until I'm settled at my first hotel and can find the nearest ATM.
For all of Rick's excellent money tips, look here: http://www.ricksteves.com/travel-tips/money
Read all the links on that page, and you'll be an expert.
Capital One credit cards, TD Bank debit cards, credit unions, and Charles Schwab accounts are all frequently mentioned on this Forum as sources of low- or no-fee credit and debit cards.
Some credit cards have foreign transaction fees ranging from 1% to 3%. Fortunately a number of credit cards have no foreign transactions fees (I know several from Chase do not have any fees). Just google and find a couple.
ATM cards will also charge a fee per withdrawal. That also varies from bank to bank. Often credit unions can be cheapest.
Having some cash is always good but I would not go overboard. I would make sure to have at least 2 ATM cards and 2 credit cards in case a problem occurs with one of them.
In most cases getting cash in the US the exchange rate is poor so usually you can get it at the arrival airport (via an ATM or cash machine or whatever the destination country calls it).
Rich
I think Chris meant that return travelers tend to put aside some francs/euro for the next trip, as Lee suggested. For me, as little as €30 will get me from the airport to the hotel in most cities.
I have never had a problem getting cash at an ATM in an airport. There's usually a machine in the baggage collection area, always at least one after customs. Worst case, change a few dollars (I assume you'll have some with you, unless you plan to arrive at the airport penniless) at an exchange if the machines aren't working. There's always a manned currency exchange. You'll pay more that at an ATM but probably a lot less than buying in the U.S.
Both countries have ATMs everywhere. You'll be able to get local currency at the train station when you arrive in the second country, probably .
I'll echo others - do some research now to get a credit card and an ATM card with the lowest rates possible. Do not use a credit card to withdraw cash.
To the general discussion about limiting percentages charged to merchants by credit card companies, I wonder how much the merchants are paying. When I first went to Italy 7 years ago, most hotels gave me a 5-10% discount for paying cash. In recent years, the response has been "cash or card, we don't care, same price either way." The only time I've been offered any discount is by booking via email or phone, since booking agents take big fees. Even hotels that have booking on their own websites are paying fees for that service.
I am the opposite of most others; I prefer to arrive with cash in hand for the entire trip (within a reasonable amount). It's one less thing I have to worry about and I have found it helps me stick to a budget. Of course, make sure you have a credit card and ATM card with you, because you never know when you may need access to more cash for emergencies or because you found that perfect souvenir or thing you want to do! Also, if needed, you can use Euros at most places in Switzerland and you will receive your change in Francs.
