Many consumers look at credit cards as a dangerous tool because they can add to your level of personal debt relatively easily.
While credit cards in the wrong hands can be a bad idea, having a credit card in your wallet while traveling is usually a good idea. There are a number of different ways that a credit card can protect you while you’re away from home. This is especially true when you’re traveling abroad.
Having a credit card can help out even before you leave home. When it comes to booking your accommodations, using a credit card can make the job a lot easier. For example, if you’re in the process of booking a hotel room, you’ll probably be required to use a credit card to do it. When you are ready to buy your flight tickets, having a credit card can make the purchase easier. Even the process of renting a car requires you to have a credit card.
The advantage of using a credit card over a debit card when paying for these things is that you have limited liability. When you use a credit card, you are only responsible for up to $50 if your card number is stolen and used to make fraudulent purchases. With a debit card, you could have unlimited responsibility if you do not report the fraudulent transactions to your bank within 60 days. This makes shopping with a credit card a little bit safer when it comes to buying travel accommodations.
Another advantage of using your credit card to pay for these expenses is that you will not have to worry about having money taken out of your checking account for a deposit. Many times, when you check into a hotel room or get a rental car, you have to provide a deposit to the company and then you get that money back later. If you don’t have much money in your checking account, you may not like the idea of having a $200 deposit taken out of it while you’re on vacation.
While traveling, using cash can be convenient, but what happens if you lose the cash? If you lose cash while you’re traveling, it’s gone. You will not be able to get it back and you may not be able to afford to do anything on your trip. By comparison, when you lose a credit card while you’re on your trip, you can get it replaced relatively quickly. You could get a new card shipped to you overnight or possibly pick one up from a location in your area. The credit card company will cancel the old card and you will not be charged for any purchases that are made on the card. This means that losing your credit card will only be a slight inconvenience while on your trip, instead of a potentially vacation-ending mistake.
More Purchasing Power
Having a credit card on hand while you are traveling can provide you with more purchasing power than if you rely on cash. Most people only keep so much cash on hand while they are traveling. You probably only have a limited amount of cash in your bank account that you can access. If you need to pay for a large expense while you are away, having a credit card on hand can make things easier. The relatively large credit limit on most credit cards makes it possible for you to make large purchases. This doesn’t necessarily mean that you’ll be splurging on something that you don’t need while traveling. Sometimes, your car breaks down and you have to pay thousands of dollars to have it repaired. In some cases, you may need to chart or a plane to get out of a country after you become ill or sick. You really never know what you might need a large sum of money for. Being able to have the purchasing power of a credit card with you can make your life a lot easier.
If you are in a foreign country, you may need to change your currency for another currency before you can make any purchases. Instead of treating your currency for something else, you can just as easily use your credit card. In many cases, the exchange rates that you get with your credit card are better than what you can get from a currency exchange. This is because credit card companies get the interbank exchange rate instead of the retail rate that you’ll get as an individual.
Regardless of where you’re going, having a credit card along for the ride can provide you with some peace of mind. Just don’t go overboard and spend more money than you can afford to pay back.
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