For those from the USA: Please read
carefully.
It has come to our attention that a major change has
taken place that will affect anyone traveling out of the US or obtaining foreign currency
within the US.
Until now we have advised people who are traveling
out of the country to use credit cards when making a purchase. It guaranteed the best
exchange rate and no charges were added for the transaction. In our past travels when we
used a credit card for a purchase the amount charged was exactly the same as if we
were paying cash. There were no exceptions to this. The exchange rate on
the date of purchase was the rate calculated for the purchase. That way we knew exactly
how much we were paying for any purchases we made and we knew exactly how much to deduct
from our checkbook when using an ATM machine.
Due to legislation that was passed by our
government, one month after George W. Bush was inaugurated for his second term, this is no
longer the case. The law passed in February 2005 but will be enforced starting this
month. Credit card companies using VISA or MasterCard cards will charge a fee of 3%
for any transaction that involves foreign currency, purchasing goods in foreign countries,
using an ATM card for obtaining cash in a foreign country or money exchange in or out of
the USA. In addition, the minimum fee charged will be $5.00 for each
transaction. Also the exchange rate can be calculated on the day that the bill is
processed rather than the date of purchase.
American Express cards that we checked also will be
adding a charge but in some cases they are lowering the charge to 2%. So far we have
not been able to find any card that will not be adding a penalty for traveling abroad.
This will significantly affect anyone who travels
out of the US.
We wish to advise you of this matter since it
counteracts all the advise we have given about money management when traveling.
However, we still know that traveler's checks are an
inconvenience and not accepted very readily in most countries we have traveled. And
of course it is not advisable to carry too much cash on your person.
If anyone out there has suggestions for how to deal
most effectively with this new law please e-mail us so that we can share that information
with others.
Meanwhile you might want to read the July 2005
edition of Consumer Reports for more information.
Thanks.
Tom and Marie
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