Travelling Abroad? How not to get “ripped-off” by your credit card!

One of the many joys of having excess time when you retire is to travel – so making your budget stretch during your holidays is never a bad thing. Most seniors rely on their local credit card to pay for their holiday expenses when abroad like hotels, meals or car rentals. Few actually realise that they are getting “ripped off” by their credit card exchange rates and hidden charges like “foreign transaction fees” because they rarely go back to check if the conversion rate back to SGD$ is competitive. All in, you could be paying up to 3-4% more – or simply put, that is up to $40 per $1000 transaction lost!

Here’s what to do the next time you travel abroad to save.

  • Get the YOU TRIP card that is launched by EZ-LINK – yes, the same EZ-LINK that you use for all your MRT rides. The YOU TRIP card is what you would call an enhanced prepaid Mastercard with the additional feature of being a multi-currency wallet. Personally, I do not use the multi-currency wallet and I am not sure if it is necessary. But the key plus of the YOU TRIP card is the amount you save versus your credit card because they apply the wholesale exchange rates that banks charge each other – “competitive real-time wholesale exchange rate with no transaction fee and no markup”. This is roughly equivalent to the best money changer rate you can get at Change Alley in Singapore. And since you are also not charged any foreign transaction fees, you can save up to 4% versus using your credit card. Here is the link to learn more.
  • Typically for car rentals and hotels, you will still need your credit card because the merchant will normally put some kind of an authorisation hold on your credit card which they will release after you complete the transaction, ie. when you check out of your hotel or close out your rental car contract. However, you can still opt to pay at the point of checking out with the YOU TRIP card instead of the credit card that was used to check you in. By doing that, you can lock in the extra savings with the YOU TRIP card.
  • In most countries, the foreign banks try to “squeeze” a little extra profit from your transaction by offering to charge your hotel or rental in your own country’s currency – ie. charge your Singapore credit card in Singapore dollars. This is a bad option. You should ALWAYS opt to be charged the in-country local currency — and not your home-currency. By selecting incorrectly will cost you a few percentage points!
  • If you need cash overseas and you want to use the foreign ATM to get cash, never use your credit card because you will be hit with so many fees you will likely throw up! With the YOU TRIP card, you can withdraw cash from foreign ATMS up to the amount in your YOU TRIP wallet — and this additional service will only cost you SGD$5 each transaction and you still get the best exchange rate. This may work out even cheaper than converting cash at the overseas money changer.

The YOU TRIP card is easy to setup using their app on your smartphone. You simply link your YOU TRIP card to your personal credit or debit card in Singapore which will be used to recharge or add money to your YOU TRIP wallet. You do not need to keep a lot of money in the YOU TRIP wallet because it only takes about 10 seconds to add money to the wallet – from anywhere using your smartphone.

The YOU TRIP card is also safer than using your credit card because you can control the amount of money you keep in the wallet. If your card is lost, you can disable the card on your app without having to call your bank. And even if your card is cloned, it is not likely that they can illegally charge any large amount on it if you keep minimal sum in your YOU TRIP wallet. The YOU TRIP card only costs $10 and there is no income qualification required. You should get your card in the mail in about 7-10 days.

Disclaimer: BetterLiving65 is not affiliated with YOU TRIP and has no commercial relationship with YOU TRIP or EZ LINK.

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