💰Stop overpaying abroad: Save up to 14% on credit card & ATM fees

With one smart strategy, you can keep more of your money when you're traveling instead of handing it over to bank fees

Your money goes further when you use the local currency.

When you’re traveling internationally, you’re probably spending a lot of time outside your comfort zone. So, when you’re paying for a meal with a credit card or taking cash out of an ATM, you might want to choose the currency that’s familiar to you, not the one where you feel like you have to do mental math.

Banks know that many people will pick their home currency by default, and they’ve set up systems where you can accept their conversions almost without thinking about it, and then they pocket the difference.

When you allow a bank or credit card processor to convert your payment between currencies, you pay more. Sometimes, a lot more.

Here’s how to get around those extra charges. It’s easy.

💳 When you’re paying with a credit card

That “Margin” at the bottom of the screen is the surcharge you would pay if you pick dollars instead of pesos. You get nothing for this charge except a feeling of familiarity.

Here in Mexico, when you want to pay for something with an American credit card, you almost always have the option to pay in either Mexican pesos or US dollars.

The server or clerk might pick the currency for you, and you might not even realize there’s a choice. That’s OK if the person knows what they’re doing. But sometimes that’s not the case, and the wrong choice can cost you.

We have a friend here who owns a restaurant, and he always picks pesos for his customers, regardless of their home currency, because he knows that’s the better exchange rate.

If you have the option to make the choice yourself, when you’re looking at the payment screen, you’ll see the amount you would pay in both pesos and dollars.

In fine print, you’ll might see "margin" or a similar term representing the surcharge you pay on top of the actual exchange rate that day.

In the example in the above photo, the margin is 3%, but it could be from 2 to 5%, depending on the bank that’s processing the transaction.

That might not seem like a lot, but a difference of 2 to 5% adds up over the course of a trip, especially when you use credit cards for bigger purchases like hotels and upscale meals.

All you have to do to save some money is choose the “pesos” option when you pay, not your home currency.

💵 When you’re withdrawing money from an ATM

This is the screen to watch for when you’re withdrawing money from an ATM.

You can pay even more in surcharges at an ATM. One day last year, we needed quite a bit of cash, so we withdrew 9,000 pesos from an ATM.

The machine offered to convert the transaction into our home currency.

If we had accepted, we would have withdrawn over $615 from our U.S. bank account, at an exchange rate of 14.65 pesos to $1.

We declined the conversion, which meant we withdrew at our own bank’s exchange rate of about 16.7 pesos to $1.

That worked out to $538.52 instead of $615, saving us nearly $80.

Our bank’s exchange rate was about 14% better than what we would have received if we had chosen the ATM’s conversion.

• The takeaway: Be alert when you’re paying with a credit card or using an ATM. Always pick the local currency to avoid extra costs.

• Pro tip: Most ATMs have an option to do your transaction in English. If you don't speak Spanish fluently, select it. This isn’t the time to practice your Spanish.