HELP - Money in USA

Old May 14th, 2013, 01:02 AM
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HELP - Money in USA

Hello,

Few questions regarding travel to the USA & Europe in the second half of 2014 regarding money.

We will be backpacking around both countries for a year are are trying to figure out the best form of money to take for each country. We are trying to hedge against the AUD dropping anymore as have budgeted it being at parity +/- 5% and the Euro being around $0.74.

1. Pre-paid Travel Cards

Are these widely accepted in the USA and Europe when booking hotels,hostels,tickets etc?

We know the exchange rate is poor and there is a risk it could be stolen and used as your name isn't on the card? Are there any with names on the card?

Also the withdrawal fees from ATM's are high but we can accept this if we are able to withdraw amounts greater than $1000 at one time ATM's in the USA and Europe...is that possible? We have heard most ATM's in USA don't allow large amounts to be withdrawn, not sure about Europe...

2. Travellers Cheques

We know this are old fashioned but we like the fact they are insured if stolen and we can take large amounts $10 000+. We know the exchange rate is average again but we would like to know if it's possible to cash travellers cheques overseas at American Express Travel Outlets for free? Are these outlets freely available across the USA and in Europe at all? Otherwise what price would I be looking at to cash travellers cheques?

3. 28 Degrees

We know this would be our first option if we could guarantee that the exchange rate won't keep dropping because of the many fees that aren't included with this card. We used this card for Asia placing cash on it before/as we went and withdraw cash from overseas. Therefore no ATM fees!

The real reason is we have most of the budgeted amount +50 000 AUD currently and want to be able to confirm the exchange rate and get as much as possible for our Australian dollar!

If you have any input or answers it would be greatly appreciated!

Thanks
travellinbackpackers is offline  
Old May 14th, 2013, 02:40 AM
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Hopefully you will get some specific responses from the several posers from Australia who have been to US.

1. Prepaid "travel" cards I do not know about - but there are prepaid Visa and MC that are taken everywhere the same cards are taken - which is just about anyplace except really small stores. I am not sure they give you any advantage over a regular credit card. There are 2 types of fees at ATMs - a foreign transaction fee which your bank will impose and can tell you how much they will charge. The other is the ATM fee - which the bank that owns the ATM will impose and may be able to avoid by using an affiliated bank (your bank can give you a list). I doubt you can withdraw $1000+ from an ATM. I have been a higher level customer at my bank for decades and my limit is $500/transaction.

Avoid ATMs in stores or not affiliated with a bank - they charge much higher fees.

2. Travelers checks are not widely accepted anymore. They can be cashed at a bank, and not sure what fees will be charged. American Express offices are not widely available.

3. I have never heard of "28 degrees" - so can't imagine it would be an easy option to use.

A problem with using any credit/debit/prepaid card to book reservations is that the merchant will put a "hold" on a certain amount on the card when you book - for a hotel sometimes it is the room rate plus a certain amount for other charges you might make.

You seem to be comfortable carrying large amounts of cash - not something I would recommend, especially on a backpacking trip - but if you are, it sounds to me like your best choice would be withdrawing as much cash as possible, using it for most small purchases, and a credit card for lodging, transportation.
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Old May 14th, 2013, 03:53 AM
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Travelers Checks impossible to use except at a bank and then with a lot of trouble. Haven't seen the accepted at a grocery or other shop in years. They have been a nightmare for overseas friends.

I agree with Gail on the rest, esp. not using ATM machines except at banks. I have lived in big cities and small villages and travel a lot and I never carry more than $100 USD in cash. With two of you, that will give you a total of $200 in what is known in Boston at lest as "walkin' around money." You don't need more. Everyone takes credit cards, prepaid or billed.
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Old May 14th, 2013, 04:15 AM
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OK - so you haven;t mentioned credit cards. In the US probably the simplest thing to do for most charges above about $20 is just to use your regular Visa or MC - and pay the bill monthly so you're not charged interest. I would use this for all major charges.

Travel cards seem to be a bad way to do the same thing = since, at least in the US, there are a lot of extraneous charges associated with them.

As for ATMS I have never seen one that will let you take more than $500 and some are limited to $300 at one time. Ask your local bank f they have an affiliate in one of the major chains in the US _ that might make it easier.

Trav Checks are not accepted in anyplace I know.

And agree I have never heard of 28 degrees. Have no idea what it is and don't think it can be used in the US.

Separately, many countries have laws about bringing large amounts of cash - more than $10,000 - in or out. I would check on that. Also I woud think that a very risky way to deal with paymnet.

Finally, you say you will be traveling for more than a year - I would be sure you aren't planning on overstaying in any one area.
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Old May 14th, 2013, 04:41 AM
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We used three cards for our trip to the states last year. Mainly for me to keep us on track with our spending and also back up in case one was lost or stolen.

One credit card was for hotels. That way I didnt have to worry about hotel holds on the card stopping access to money.

Another was for purchases that were more self indulgent splurges outside of travel expenses. (Tiffany's, handbags, clothes etc)

The other was a prepaid travel card with the day to day spending money for food, sightseeing etc. It was load with US dollars and we would withdraw money every few days. We paid an ATM fee but no conversion fee to AUS$ like the other cards did. The prepaid card we got gives you two cards ( one as a spare ) so we both were able to have a card each. You can transfer funds to the travel card at any time if you want. I have noticed some now let you load up with a number of currencies. There is no name on them but we had no trouble using it at a couple of restaurants or buying tickets to a show.

A lot of online savings accounts give you higher interest these days. What if you left your money in one and just transfer an amount to your prepaid /credit cards when they are running low and keep earning interest on the savings account to counteract any atm fees or losses in rate of exchange rather than transferring the whole amount.

I think you would have trouble with travellers cheques. We saw some signs saying they werent accepted.
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Old May 14th, 2013, 05:35 AM
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"Travel cards seem to be a bad way to do the same thing = since, at least in the US, there are a lot of extraneous charges associated with them"

"Trav Checks are not accepted in anyplace I know."

UK visitors to Florida, particularly Orlando, use them extensively...and the local merchants do accept them. They also have a strong aversion (fear?) to credit cards. Why? I have no idea at all.

My preference is an ATM card for cash withdrawals and a credit card vs. a debit card. By this, I mean one with no foreign conversion fee or one that offers rewards (FF miles or cash back).

1. If you ever have an emergency where you need more money than you brought with you, you are protected. Of course, nobody ever expects an emergency, but they do happen. What if you had a medical emergency and your travelers insurance required you to pay first and then seek reimbursement after you paid the bill and returned home?

2. Hotel & rental car deposits will be simply a hold against your credit limit. It won't (temporarily) deprive you of any cash saved for your trip. This could be several hundred dollars.

3. In case of a disputed charge on a transaction (i.e. rental car charges) you have more recourse (through the cc company) than if you simply paid cash or used a debit card. That kind of transaction is more final.

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Old May 14th, 2013, 05:56 AM
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28 Degrees can absolutely be used in the US - I think it's just branded that way in Aust and Americans don't know what it is.

I think it's kind of strange to budget for our dollar being at parity more than a year away. I went to the US for six months in 2010 - it was just under 80c when I left, and over a dollar when I came home - had a travel card locked in before leaving but barely used it over there because it offered little value with the fees & our increasing dollar value, I just used my normal ATM card. Maybe look at the exchange rates closer to the time and figure out if the charges on travel cards are going to be smaller than any money you might lose from a fluctuating dollar on 28 degrees.

Just as a heads up, Choice compared the travel cards to 28 degrees and the latter came up a winner.

http://www.choice.com.au/reviews-and...rds-table.aspx
alexandrabatman is offline  
Old May 14th, 2013, 06:03 AM
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Prepaid cards are generally the worst of all possible ways to carry money, save in cash. The fees and poor exchange rates make them a bad deal all around. Perhaps they are better known and more widely used in Australia, but here they have a fairly poor reputation and are known for high fees.

The amount you can withdraw with an ATM card varies by country and by bank. Amounts, for example, are high in Japan but low in the U.S. $500 is usually the top. Still, that's still a reasonable way of taking cash to a variety of countries. (Europe, by the way, is not a "country" ... it's many countries, some of which do and do not use the euro.)

I'd examine two possibilities. In the U.S., there are several companies that offer both credit cards and bank accounts with low or no withdrawal fees. Use an ATM/Debit card for cash withdrawals from ATMs and credit cards for large purchases. Pay your bills online. If such a thing exists in Australia, then go for it, but even with a $5 withdrawal fee, you will likely still pay much less by withdrawing cash $500 at a time than if you exchange cash or use a prepaid card, where you may lost as much as 10% on each transaction. Even at a high-fee bank, you rarely lose more than 4% to 5% on each transaction if you withdraw enough.
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Old May 14th, 2013, 10:43 AM
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Do be aware that the holds put on cards can be significant and may not be removed immediately.

A couple of years ago I encountered in a Hertz office two young Irish couples who were apparently traveling near the limit of their cards. The cards were taken for the rental - but they didn't have enough extra on them for the deposit ($1000) - so they had to to go a couple of nearby banks and pull that amount in cash before they would let them have the car. (Apparently their current and previous hotel each had put a several hundred $ hold on - taking up all the available credit.

One thing you can do is make sure that the hotel releases the hold they have on however much it is when you check out.
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Old May 14th, 2013, 02:56 PM
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Credit cards and ATM cards are the way to go in the U.S. Almost every store you go into will accept a credit card for any amount--it doesn't have to be above $20 as one of the other posters indicated. If I'm out of cash when I go to the supermarket, I just charge that $1.69 pound of apples!
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Old May 14th, 2013, 05:32 PM
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It's true that most stores will take credit or debit cards for almost any amount (a few have a minimum of $10). I pay cash for less than 20 since it's usually easier or a place (newsstand or similar) that takes only cash.
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Old May 14th, 2013, 07:19 PM
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Two things to know:

1) You can go into just about any major grocery store in the U.S., buy less than $5 worth of food, and, when using your ATM Card (the clerks will call it a "Debit Card"), ask for "Cash Back" of up to $50. There are rarely any fees for doing this, and you can do this every day with no problem. If you need spending cash and don't want to search for an ATM, this is the way to go.

2) The number of places that do not accept credit cards in the U.S. is becoming increasingly small. I regularly buy about $3 worth of food at convenience stores or fast food places, and have never had a problem using my CC to do so, nor have I been charged one penny in fees. While it is now legal to charge extra for using CC, the only places that I know that do so are gas stations.

As noted above, ATM and CC are the way to pay for travel in the U.S., and it is the way I have done so, all over the U.S., for over twenty years. Obtain a ATM Card from an Australian bank that has reciprocal usage at ATMs in the U.S., and a CC from a company that permits you to make online payments directly from your bank account. You can thus keep your money completely safe in your bank, earning interest, until the day you need to pay your CC bill.
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Old May 14th, 2013, 08:16 PM
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You will need a B1/2 visa for the US. You are allowed a stay of up to 180 days.

It can be extended, but you need to apply and have an interview, pay a fee of $290 and show proof of funds to sustain yourself for additonal time, as well as a reason why you need 180 days.
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