Can You Buy Traveler’s Checks With a Credit Card?

Traveler’s checks, once a common method for securing funds during travel, served as a tangible alternative to carrying large sums of cash. These paper documents, issued in fixed denominations, provided a layer of security by requiring a signature at purchase and another at the point of use, making them difficult for unauthorized individuals to cash. Many travelers today wonder if purchasing these checks with a credit card is a viable option.

Purchasing Traveler’s Checks with a Credit Card

Purchasing traveler’s checks with a credit card is generally not possible or is highly discouraged by financial institutions. Such a transaction is categorized as a cash advance by credit card issuers. This classification triggers immediate fees, typically ranging from 3% to 5% of the transaction amount, with a minimum charge often around $10.

Cash advances accrue interest from the moment the transaction posts, without the benefit of a grace period. Interest rates for cash advances are significantly higher than for purchases, frequently falling within a range of 25% to 30% Annual Percentage Rate (APR). This immediate and elevated interest significantly increases the cost of obtaining funds. Credit card issuers and agents selling traveler’s checks have policies to prevent credit card purchases for this purpose.

Accepted Payment Methods for Traveler’s Checks

When purchasing traveler’s checks, accepted payment methods represent readily available funds. Cash is a widely accepted form of payment. Using a debit card is a common option, as it directly accesses funds from your bank account and usually requires a Personal Identification Number (PIN) for verification.

Some financial institutions may accept personal checks, though this often involves a holding period before the traveler’s checks are issued. This holding period can range from a few business days to over a week, allowing the bank to ensure the check clears. Traveler’s checks can still be purchased at select financial institutions, including some banks and credit unions.

Alternatives to Traveler’s Checks for Travel Funds

Modern financial tools offer more flexible and convenient ways to manage money while traveling.

Prepaid Travel Cards

Prepaid travel cards function similarly to debit cards but are not directly linked to your primary bank account. You load funds onto these cards before your trip, which helps with budgeting and offers security since your main account remains isolated from potential fraud. These cards may incur various fees, such as activation fees (often $5 to $10), foreign transaction fees (1% to 3% of the transaction), or ATM withdrawal fees ($2 to $5 per transaction).

Debit Cards

Debit cards provide direct access to your bank account for ATM withdrawals and purchases, making them convenient for obtaining local currency. Inform your bank of your travel plans to prevent transaction flags, though some banks no longer require this notification due to advanced fraud detection systems. Be aware of potential foreign transaction fees, usually 1% to 3% of the amount, and ATM fees, which can be charged by both your bank and the ATM operator, often totaling $2 to $5 per withdrawal.

Credit Cards

Credit cards are widely accepted for purchases globally and offer robust fraud protection, such as zero liability policies. Many credit cards come with rewards programs, allowing you to earn points or cash back on your travel expenses. However, some credit cards charge foreign transaction fees, typically 1% to 3% of each international purchase, so selecting a card without these fees is beneficial.

Cash

Carrying a limited amount of local cash is practical for small purchases, tips, or in areas where card payments are not widely accepted. To enhance security, distribute cash among different locations, such as a wallet, a money belt worn discreetly under clothing, and a separate secure bag. This practice, known as multi-stashing, minimizes the risk of losing all your funds if one location is compromised.

Mobile Payment Apps

Mobile payment apps like Apple Pay or Google Pay offer a secure and convenient option. They tokenize your card information for transactions and reduce the need to physically present your credit or debit card.