Once upon a time, credit cards were the best way to guarantee the best exchange rate and avoid fees when making purchases internationally.
But unlike most fairy tales, this one does not have a happy ending.
Most banks that issue Visa and Mastercards now assess a “foreign transaction fee” — 3% is pretty typical — on purchases made outside the United States.
It usually includes the 1% fee MasterCard and Visa have begun charging to convert purchases made in foreign currencies into dollars.
Most galling is that many banks even impose the fee on foreign purchases made in U.S. dollars, a common occurrence in the Caribbean.
You’ll have to read the fine print in your credit card’s disclosure statement to find out exactly how much you’re being charged — unless it’s from Capital One.
None of its cards impose foreign transaction fees. Capital One doesn’t even pass the 1% fee charged by Visa and MasterCard fee on to its customers.
That deserves some big-time kudos.
If you’re planning an overseas trip this summer it might even pay to get a Capital One credit card just to avoid the costly fees other credit cards assess.
We think the Capital One No Hassle Miles Rewards card is one of the best deals around.
It offers no annual fee, 0% APR on purchases for one year, no fee for balance transfers and a generous system for earning points toward airline tickets.