Wednesday, August 8, 2012

Why I Love My Travel Fund

It's kind of a no-brainer, but after getting back from this vacation, I really appreciate my travel fund in a way that I haven't ever before. I've always saved for travel, I've always had a travel fund of some kind, but because I always worked part-time and didn't get paid time off, any travel was a huge predicament where I would not only need to save my money for the trip itself, but save up to make up for the money I wasn't earning while I was gone.

This time, I came home to a paycheck direct deposited in my bank account, and I just immediately moved money from my travel fund to the credit card I used primarily while I was on vacation.  VICTORY!

One thing that I have to share about credit cards and Europe--something that could have been a potential disaster for us is the new Chip and Pin system that most of Western Europe is moving toward.  This is not actually new, new, cause we encountered it a couple times in Ireland two years ago and once it prevented me from buying a pile of exotic candies--the horror.

What it is, is that now European credit cards are embedded with a chip, and instead of signing, you have to enter a pin number.  You insert the card into a special reader, it scans the chip, and then you enter your pin.  Two issues with this:

  1. American credit cards do not have chips
  2. Most American credit cards do not have PINs
If you're dealing with a merchant, you can still ask him or her if you can swipe and sign, and they will accommodate you.  Although, when we were trying to pay for our Danish hotel room, the desk clerk had a hell of a time trying to get the charge to go through, and I was starting to panic that we'd get charged more than once (didn't happen-whew).

The other wrinkle is that if you're not dealing with an actual merchant, if you're in a self-service situation, you have no choice but to enter a PIN.

We got into a bit of a predicament when we landed in Sweden and had to buy train tickets back into town.  We had two banks cards (debit) cards with PINS, but only one of them worked and that was my bank card.  Since I never keep money in my checking account because it doesn't earn interest, I was worried that I wouldn't actually have enough in the account to pay for the tickets and we'd be trapped at Arlanda airport waiting for money to transfer.  For some reason, bf's ING debit card would not work at all, and a friend of ours couldn't use his debit card in the Danish metro kiosks.

Arlanda airport is very lovely, but I do not want to live there
We also got into a real bind at the train station in Malmo, Sweden when we tried to book a luggage locker through an automated system. That system would not accept our cards at all, and if it hadn't been for some nice Danish ladies who booked a locker with their card and let us give them cash, we would have been screwed.

So, what's an American or possibly Canadian to do in this situation?

  1. Talk to your credit card company.  This is obviously a huge problem, and hopefully they will rectify it--at least by issuing PINs to people who ask for them.  This may not do any good though, because a friend of ours called his Visa card and was told "we don't do PINs."  According to BF (and I don't know how he knows this) Americans can get chip and PIN cards from some banks, but the cards themselves are prohibitively expensive.  I'm going to look into this further.
  2. Have cash available in a variety of accounts.  We never had issues using ATMs, just debit for point of sale transactions.  If, for some reason, none of our debit cards had worked, we could have trekked all over the metro station to find an ATM and paid cash.  That would have been a real pain, but it could have been done.
  3. If you're super-organized (and I am not) try to get cash before you leave the US.  Usually, with enough notice, your bank can order foreign currency, but I have no idea what kind of exchange rate they would give you.
In the past, when traveling, I've relied almost exclusively on credit cards, and that would have been a real problem on this trip.  If you're planning to travel anywhere outside of your home country, make sure you have the ability to access cash and not from a credit card advance that will cost 30% interest.  Having a travel fund is the way to go. 


  1. Hiya
    All of our cards here are chip and pin now as obviuosly it cuts right down on crime. No point in stealing a card which you cant use. Visa most defintiely do them, my visa debit has a bright shiny card showing from here! Also I would suggest ensuring you have online banking fro all o f your accounts so that you can move money aorund if cards dont work. You can get on the net everywhere nowadays I would think, so just make sure you can get at tyour money and get it to a card that works.
    ENjoy your travels!

  2. @Lizzie when did everything change over to chip and PIN? I know it's been in the works for a while, but friends who were traveling in Eastern Europe said that they're still not switched yet. I know Sweden, Denmark, Ireland and the UK are--is most of Europe?