From the Editor: A Few Travel Tricks

One of the most frequent questions I hear is “what’s the best way to deal with foreign exchange when traveling?”. The prevalence of contactless payment options means there is less need to carry cash, and credit cards become a more important option. While exchanging physical money is becoming less common, that doesn’t mean going cashless is always the solution. You should understand what to expect in the country you’re visiting, as some destinations may still rely more on cash.

If you are going to pay primarily with your credit card, you should have an idea of what the costs of spending in foreign currencies will be. That can be broken down in a few ways; one is the actual exchange rate for currency conversion. This can vary widely, but generally, Canadian credit cards offer competitive rates. Then, when using a card, you will be charged a foreign currency conversion fee. This is, on average, about 2.5% of the transaction. Some credit cards, although few, offer a 0% conversion fee, and most of those come with an annual fee. The goal isn’t necessarily to avoid annual fees altogether, but to understand the overall costs. The best credit card for traveling isn’t necessarily the one with the lowest fee. You might also consider the insurance coverage, how widely the card is accepted, and how important the card’s rewards program is to you.

Another point to keep in mind when using a credit card abroad is that the point-of-sale terminal may ask whether you want to process the transaction in Canadian dollars (CAD) or the local currency. You always want to choose the local currency. If you choose CAD, a third party will process the currency conversion, and you’ll likely get a worse exchange rate and extra fees.

How to handle your phone and data when you are out of the country is another consideration. A popular option is using an eSIM card that can be downloaded onto your phone. The big benefit of an eSIM is that the options can be very cheap. This makes them a great option for longer trips. The main drawback is that most eSIM options are data-only, meaning you won’t be able to use your phone or receive texts. This can be a minor inconvenience or a real problem if you need your phone number for two-factor authentication at some point.

The major wireless companies in Canada offer roaming options that keep your phone access. These options might be convenient for short trips or for those who need their phone to work as it does at home. But the costs will likely be much higher than an eSIM, particularly for longer trips.

If you’re booking a hotel, using a travel site is a great starting point, as it offers a broad selection of options and makes it easy to search. But once you’ve settled on a place, check the rate being offered directly by the hotel. Often, you can get the same or a similar rate, and sometimes the hotel will include things like free breakfast. And in the event of any problems or changes in plans, you can deal directly with the hotel, which is often easier. If you booked the room through a third-party site, the hotel staff won’t be able to help you with any problems, and you’ll be left calling the travel site’s customer support line.

With your travel plans secure, you can now enjoy the rest of Nexus Notes. In this issue, you’ll find Denys Calvin’s thoughts on alternative investments. In her blog, Why Scary Headlines and Strong Returns Can Coexist, Alex Jemetz talks about how to digest all the news headlines. And Tricia Allen reviews the book Strangers. More than a divorce story.