family walking on the beach
Tanya Steinhofer No Comments

While traveling in Costa Rica this summer, I realized that there are many ways to make an international vacation slightly less expensive.

Here are a few of my favorites:

– Use the right credit card and ask about extra fees. Many credit cards charge a 3% foreign transaction fee. Confirm that your credit card company doesn’t do so. American Express and Capital One are two major cards that don’t charge this fee. Also ask if each vendor charges an extra fee if you pay with a credit card instead of cash.

– Withdraw money from ATMs. Most countries have ATMs that will accept US bank cards. You get a better exchange rate if you withdraw money this way once in country than by converting money at a currency exchange booth or using traveler’s checks. To reduce the impact of any transaction fee the local bank or your bank might charge, take out large amounts each time.

– Pay in the right currency. Many countries will offer to let you pay in USD with your credit card using a process called Dynamic Currency Conversion. However, they are unlikely to give you a better exchange rate than your credit card company and might include a 3% conversion fee, so it’s generally best to say you’ll pay in local currency. However, in Costa Rica (and possibly other countries), each individual vendor chooses the exchange rate to use and will then run it through the machine in USD. I found a wide range of exchange rates in use, some of them more favorable to paying in dollars and some more favorable for paying in the local currency. So, know what the official exchange rate is and ask each vendor what exchange rate they are using and then ask that they run the charge in whichever exchange rate is more favorable.

– Say no to unnecessary insurance. Car rental companies often make more money selling you insurance than they do on the car rental fee. Check with your credit card company to see if they cover damage to rental cars and if they do, you can decline the loss damage waiver. You might also call your insurance company to see if they offer any rental car damage or liability coverage in the places you are traveling. My company offered coverage in the US, but not overseas.

– Notify others of your travel plans. To reduce the odds that your debit and credit cards will be declined, it is wise to let your credit and debit card companies know the countries you’ll be traveling and the dates.

Use the internet to find the best deals. Use sites like Kayak and Hipmunk to find the cheapest airfare and monitor prices ahead of purchase. Use sites like Trip Advisor and Expedia to research hotels and restaurants and lock in low prices.

While it is hard to estimate exactly how much these tips saved me on my recent trip, just using my Capital One Visa card and declining the loss damage waiver on the rental car saved me over $500. That amount of money more than covers the cost of the jewelry I bought!