Setting off on a long trip overseas or a round the world adventure can be one of the most exciting highlights of your life. For that reason, it can be easy to get caught up in the excitement and overlook some of the more tedious aspects of long term travel around the globe and to far flung destinations.
While most long term travellers, gap year backpackers and permanent digital nomads spend plenty of time planning their trip and whittling down their packing list while sketching out an itinerary, things like insurance, vaccinations and finances can easily be put on the backburner until they become a problem.
Sure, you’ve probably saved up a nice lump sum and worked out a rough daily allowance, but have you considered the finer details surrounding managing your finances while travelling the world? This guide should hopefully highlight a few items you might’ve overlooked when planning your financial activities while on the road, along with some handy tips and solutions.
Are You With the Right Bank?
While living in your home country, your current bank and the account you hold might’ve been meeting your needs perfectly. But now that you are hitting the road, and heading overseas, that bank might not be the best choice.
As you will be using your home bank account to withdraw money in foreign countries and in their corresponding currencies, it is important that you find a bank that has no or low international fees. As you want to avoid carrying a large amount of cash with you at any one time, making frequent trips to the ATM will become a regular occurrence during your travels.
If you happen to be a customer of a bank with high international fees, then each time you make a withdrawal away from home, you will be losing money over and over again. Some banks will charge a foreign exchange fee for the privilege of withdrawing your own money. It’s also not uncommon to find a cash withdrawal fee has been added on too.
As these fees are usually a percentage of the amount you withdraw, there is no easy way to avoid paying them on your transactions. If you think about how often you will need to access your money while on the road, you can easily see how quickly these charges will add up and how much money you would be losing out on over a long trip.
As it’s more difficult to open a bank account once you’ve already set off on your trip, make sure you do your research before leaving and find a bank that offers the lowest, or no international fees. While you are doing your research, you should always compare bank accounts and not rely on the advice from well-meaning friends.
Managing Direct Debits
If you do change bank accounts then it is vital that you ensure your direct debits are in order before leaving. Even if you don’t change banks it is still a very good idea to inspect the regular payments that have been authorised to be taken from your account.
Cancelling any recurring payments before leaving is a great way to prevent your finances being eaten into while on the road. This could leave you in a tight spot when an unbudgeted for payment is taken from your account. Gym membership, DVD rental clubs and personal subscriptions are prime candidates for being cancelled or put on hold before leaving. Make sure you talk to the provider first, and don’t simply cancel the direct debit in case you are breaching your contract.
You probably already have access to internet banking with your bank. If not you could try the Halifax bank as one option as they have a reliable online service. However, before setting off, it’s important to make sure you can login and are familiar with the service, while also being able to easily view your recent transactions and transfer money, as well as pay off credit card payments.
The last thing you want to do while on the road is to try and arrange for your bank to send you your login details, or waste precious time trying to remember how to add a new payee to your account.
Many online banking accounts come with a card reader now, so make sure you have yours before you set off. Without your card reader, you might not be able to access your account or transfer money to new recipients, depending on your bank. Check you know how to use yours and have all the required PIN codes and a working device.
While you are travelling, making frequent trips to the ATM in new countries can quickly get tiresome, especially in developing nations. However, the less money you have on you at anyone one time, the less you have to lose.
Keeping just enough with you while travelling means that should you lose your belongs, or heaven forbid, have them stolen from you, you won’t have to deal with arranging emergency funds while far away from home.
As well as keeping your cash safe, having a backup ATM card, whether that be a credit card or a debit card, is a very good idea. Losing all your cards when your wallet goes missing can be as debilitating as losing all your cash. For that reason, keeping a spare card, perhaps with a backup bank account, can be a real life saver should something go wrong.
Hopefully these tips for helping you to manage your finances while away from home will help you have a prosperous and happy trip. While this might seem like the last thing you want to think about when planning your big adventure, a few hours spent in preparation can spare a lot of hours lost to stress, inconvenience and difficulty should something go wrong.
If you have any more financial or money related travel tips, please leave a comment below.