This is a guest post by Richard Adams. He writes about personal finance and getting out of debt at his blog Debt Assistance Guru.
In normal everyday life managing your money can be a reasonably simple affair. You have regular access to ATMs where you can withdraw cash, check your balance and so on and you probably also have regular income arriving from your job making it far easier to budget.
But what if you are planning to go traveling around the world for months on end – what smart choices can you make to not only protect your money while you’re abroad but also to ensure it is easy to access when you need it.
Somehow being away from home, living in rented accommodation and in a foreign country can make the normal day-to-day elements of managing your money far more complicated. So in this article I’d like to examine some of the more successful techniques I have used to manage my money while away from home for longer periods of time.
Money Belts
First off you’re likely to have some cash with you while travelling so depending on the country you are visiting it can be a smart idea to hide your money from view rather than leaving it in your wallet in your pocket. The harder you make it for pickpockets to target you the greater your odds of holding onto all your money.
Money belts and similar security devices can be helpful for concealing cash. Personally I found a useful habit has been to decide on a rough budget for the day based on what I am expecting to do while away and then place this cash only into my pocket. The rest of my cash goes into a money belt.
This way I can walk into a shop, visitor attraction or so on and pay with cash out of my pocket knowing that the rest of my money is safely hidden. In this way I do not need to reveal to anyone that I am even wearing a moneybelt. They just see someone reach into their pocket to retrieve cash without being aware that I only have the exact money I am expecting to spend and hence a pickpocket even if successful will only make off with at most a day’s money.
Prepaid Debit Cards
Credit cards are accepted in many parts of the world and can be a very convenient way to pay for goods but they are also easily and regularly ripped off and used by criminals.
One way around this is to arrange a collection of prepaid Visa and Mastercard cards before you leave home. Load up each one with a small volume of money and use a seperate PIN for each.
For the best safety try to keep the cards locked in the safe of the hotel in which you’re staying or in your money belt. Then if and when you want (or need) to pay for something by card while you’re away you can use one of your cards and if the worst happens and your card details are stolen then you’re limited to only the small amount of money on that particular card.
Assuming your card survives, but it has run out of money, you can decide either to top it off again with more funds, or to move onto your next card.
Credit Cards
If you are planning to take a proper credit card away with you there are a couple of hints which can make life easier for you. The first is to inform your bank of where you are going and when so that they are less likely to block it when they see plenty of transactions going through in a foreign country.
Secondly, you can temporarily lower your credit limit with many banks so that if your card does get stolen your risk is far lower.
Internet Banking
Setting up internet banking before you go travelling can be a very smart idea as it will allow you to monitor your account balances, transfer money and pay bills easily by bank transfer.
With many banks it is necessary to actually set up this up, request a password and so on so it is recommended that you get yourself an internet banking account some weeks before you go travelling to give the bank time to set everything up for you.
On the other hand, accessing your bank account online has risks which can be increased substantially when travelling. One should be careful of using wi-fi to connect to the internet, which can be easily hacked, or using shared computers in internet cafes and hotels.
Ideally use your own computer via a wired connection for best security while away but as a worst case scenario check that any internet cafe you use has up-to-date antivirus operating to reduce the risks of your details getting stolen by a trojan horse or other malicious application.
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Travellers Checks
Travellers checks obviously have a number of benefits such as the way they are so widely accepted and the fact that they are insured as standard so any loss or theft of your checks can easily be rectified.
It can be a smart idea to take a mixture of cash for easy access when paying. Travellers checks can be turned into cash when necessary, but are generally safer than taking all your spending money as cash alone.
Emergency Funds
One final tip worth mentioning is to keep a bank account only for emergencies and let your family or friends know the details of it. In this way if the worst does happen and your money gets stolen or lost, they can transfer some money into your emergency account (from your home country giving you funds to cover any unexpected situations.
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