how we avoid atm charges and bank fees when we travel

Remember Traveller's Cheques?

Remember changing as much of your money as possible, often at extortionate rates in the post office, before heading off somewhere foreign?

Remember when you had to tell your bank when you were going to a different country so you didn't get your card blocked over there?

Oh, yeah, that last one still happens.

Travel can be hard on all our finances, especially when you're on a shoestring budget. However, after saving for months or years for your adventures, the logistics of managing your money should be the easy bit. However, speaking from experience, there's nothing more frustrating than seeing that hard-earned travel fund frittered away needlessly on things like bad exchange rates or extortionate ATM fees when you're on the road.

In this digital age, full of digital nomads, the system simply hasn't caught up.

After two-and-a-half years of non-stop travel (most of it on a budget of £15 each per day in Latin America), we know all about it. We would um-and-ah over the price of a can of coke or if we could splurge on some snacks for those day-long bus journeys but, later in the day, we'd have no choice over the costs to access our own bloody money! And this was despite spending a lot of pre-trip time working out how to cut down or avoid these costs as much as possible.

Between us on that long-term adventure, we took 6 bank/cash cards, as well as a couple of old expired ones to use as a dummies in the event of a bus hold-up (thankfully that never happened!). These included:

- A pre-paid card

- Our own individual debit / credit cards

- Our joint debit cards

- Back-ups in case we lost one or two of the above.

Sounds like a lot huh? In truth, when we set off in 2014, it seemed like a pretty good solution to keep on top of our finances. The only reason Andrew was with his bank in the first place was because they used to charge nothing for usage abroad, but that got scrapped years before and, to get that same privilege now, you had to pay a monthlyfee.

There remained only one other bank in the UK which had maintained that arrangement, but we weren't able to join in time (and one of us got rejected on the application!). So, instead, our grand plan to manage and make our money last was:

1. We would use the credit card to pay for purchases in more developed countries (and so pay zero commission or fees)

2. The pre-paid card would give us the ability to have free ATM withdrawals, although it did cost us 3% to transfer any funds to that actual card. So, taking out £200 cost us £6. 

3. The debit cards were there as a back-up because, when used to take cash out, they charged a 'non-sterling transaction fee' of 2%  and a 'non-sterling cash fee' of £1. If we were taking out a large amount of cash in one withdrawal, this would sometimes work out cheaper than the pre-paid card. 

We reckon that, conservatively, we spent about £400 on commissions and ATM fees - and that was by us doing it smart at the time with the best methods available to us.

And that pissed us off so much. 

Aside from the money charged, that multi-card arrangement cause numerous headaches and wasted hours. For starters, just remembering which pin was for which card and which card was linked to which account proved a challenge. As we mentioned, sometimes it was cheaper to take out a big wedge of cash with our bank's debit card, rather than the ICE pre-paid card, even if the bank charged us a lot more fees upfront (but Andrew would only discover this after doing various calculations to make sure EXACTLY which one was saving us that 40p here and there). And then, if it turned out our ICE pre-paid card was cheaper, it would take us about 45 minutes and three failed attempts to actually transfer money from the one approved bank account because the bank would almost always block it OR the transaction would fail because of crap internet connections and a clunky as hell website. 

And breathe!

Also, on the road you don't always want to be forced to visit ATMs in strange cities or bad neighbourhoods and take out hundreds of pounds worth of local currency in a single go because it will save you an extra couple of quid - it doesn't make you feel safe, you end up having to spread it out across your person and luggage and, well, it makes it easier to loose or have it taken from you. And, if you're like us, you'll have at least one of those 'where has all the money gone!?' moments in your hostel room before emptying your your entire backpack, ransacking the room and eyeing everyone suspiciously before realising it's tucked away somewhere you forgot or you really did spend that much money in a short space of time. 

And so, fellow travellers, we were so bloody happy when we returned to the UK and found out that the money management options both short and long-term travellers had improved dramatically.

You will lose money on commissions, ATM fees or bad exchange rates at some point on a long trip - the aim is to keep that figure as low as possible!

Us millennials have lived through a period of such rapid technological change, that it's easy to take it all for granted. Show an iPhone 8 to Andrew of 12 years ago, and he'd be convinced you were some alien from the future pedalling black magic. And yet, today, we're all so damn blasé about how small the world has become due to technology and the interwebs closing the distances which oceans and mountains had previously made so daunting (and fascinating).

Having become so frustrated with our previous experiences, and the amount of money and time it wasted, we endeavoured to find a better solution. So, for the last few months and trips, we've been testing out a new option to save us money on the road and make handling our travel finances easier - and it works like a charm.

Building on the pre-paid card model we used in 2014, the Monzo card has fixed both the bad tech and removed the extortionate commission fees. There are no added costs for ATM withdrawals or spending abroad, it can be used in any ATM worldwide with a 'Mastercard' logo, with an exchange rate around the (or sometimes better) than the interbank rate, and transferring funds from our main bank account to our Monzo account takes 10 seconds and two clicks in the app (and is free).

It's removed so many of the headaches about sorting out our money before a trip, or whilst we're out on the road - and we can't recommend it highly enough.

We don't use it as our sole money source on the road though (and we wouldn't recommend you do either). We always take a stash of emergency hard currency with us, as well as our normal banks cards as a back up. Although we can use Monzo card like a credit card abroad, without fees, we do prefer to use our own credit cards for bigger purchases on the road (like paying for our accommodation in person or for transport tickets) and then settling that monthly later from our joint account. Also, we wouldn't recommend putting too much money on the card at once - keep it in your bank account and transfer funds as appropriate for your needs.

Most importantly, the Monzo card is supported and controlled fully by a secure mobile app. If you think your card has been lost - then you can freeze it instantly (and unfreeze if you discover it's actually just under your bed!). Any purchases or spending show up immediately on the app too, so if someone does steal it, you'll find out very very quickly. And contacting them for queries couldn't be simpler - it's all done via instant messaging on the app, so you don't have to go through the effort of finding 1) a good enough internet connection that won't drop out every two minutes and 2) a quiet part of your hostel in order to contact them, unlike what we had to do once in La Paz over the course of 45 minutes. It even gives you a 'welcome' message after your first transaction in a new country!

Of course, in a world of start-ups, there are a number of alternatives out there - like Revolut and Curve - but having spent a long time reviewing the options, we settled for Monzo. At the time of writing, Curve still charges standard ATM fees whilst Revolut charges £5 to deliver your card and has an ATM withdrawal limit of a miserly £200/month (after which it charges 2%). Monzo doesn't charge for delivery and its monthly withdrawal limits are higher (which is really important for a long-term trip).

Update January 2018 | Unfortunately Monzo has changed its terms, and now only offers £200 of free ATM withdrawals to its current account holders per month. After this, it has a 3% charge for foreign withdrawals. With its app functionality and features, it's still a really good option (especially if you are just on a short-term break each month).

Update August 2018| We now travel with a Starling Bank card, which offers the same app functionality as Monzo but does not charge for ATM withdrawals abroad. Withdrawals are also unlimited! It take 5 minutes to apply for an account, and they send out a card for free too! Find out more or apply at Starling Bank.


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Fed up of paying extortionate ATM fees and bank charges when you travel? So were we - and then we found a better way... Click on the pin to discover more.

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