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• Oct. 23, 2023

Planning an immersive cultural food tour of Italy, or looking to explore a secluded beach in Costa Rica?

Wherever your next vacation may take you, planning to get the most out of your travel budget can be just as important as ironing out the details for your getaway.

According to Expedia Group's 2023 Traveler Value Index report, while nearly 46 per cent of millennials surveyed say travel is more important to them now than pre-pandemic, a budget is important when it comes to planning where to go and how they spend their money while vacationing.

Knowing when to use cash, debit, or credit could help you manage, and potentially save, on any foreign exchange or withdrawal fees and any interest charges, while relaxing and enjoying new experiences.

Some tips on when to use your credit card while travelling

Tip: A credit card may be your best choice for big purchases such as plane tickets, accommodation, transportation, car rentals and pricier meals so you have a record of larger transactions when you get home. If you make any purchases with your card while on your trip, you may benefit from insurance coverage on those purchased items. Be sure to check if your card provides this type of insurance coverage before you travel.

You should look into whether your card has any travel-related benefits. For example, your credit card may offer travel insurance, trip cancellation insurance and/or lost baggage insurance, so it would be beneficial to book your travel using that card to get the benefit of these coverages.

Also check to see if your credit card offers any other perks, such as preferred booking options, lounge access, upgrades, early check-in or late checkout options.

Tips for using your credit card:

  • Leave cards that you don't intend to use at home, safely stored. Take with you (and keep secure) a list of all your card numbers together with the lost/stolen customer contact phone numbers for those you are bringing with you.
  • Using a banking app can help you stay informed of any account activity linked to your credit (or debit) card in real time, including alerting you of any unauthorized transactions or fraudulent purchases when the cardholder's cellphone is on file.

Some tips on when to use your debit card while travelling

Tip: Use for cash withdrawals at ATMs abroad instead of using a credit card or carrying large sums of cash.

Most Canadian banks offer debit cards that allow you to withdraw cash from ATMs linked to a global network as well as make in-store purchases in many foreign countries. Look for machines that use the network symbols shown on your debit card, as your card may not work with every machine (the front and/or back of your debit card will show you the compatible ATM network symbols to watch for). Make sure you understand what foreign exchange fees may be charged when you make a withdrawal by asking your financial institution before you travel.

Be mindful that your card may not work at some ATM's in some foreign countries, so always be prepared with another form of payment.

Some tips for carrying cash while travelling

Tip: Use cash for small-ticket items such as souvenir shopping, street markets, taxis, bus fare, local tour guides and tips.

Some foreign merchants don't accept debit or credit as forms of payment, so you should carry some cash in the local currency with you. Although carrying large sums of cash isn't recommended, having some local currency on hand for at least a couple days is good practice as banking hours may not be consistent in some countries and bank machines may be out of cash.

Getting your currency exchanged before you leave so that you have funds in the local currency when you land (and aren't spending your vacation running errands) is a good idea. But if you don't get to this before you leave, a bank or an exchange desk in the country you are visiting should be able to convert your Canadian dollars into the local currency. Learn more about currency exchanges at TD.

While foreign exchange rates and conversion fees will likely still apply, these might be lower than if you purchase local currency when you land at your destination airport or your hotel. Learn more about foreign exchange rates at TD.

Tips for using cash:

  • When possible, have small denominations on hand as some merchants may not accept larger bank notes.
  • Don't keep most of your cash in one place. Consider using a money belt for all your cash (to help discourage pickpockets) while using your wallet to hold only what you need for the day.

Some banking apps, like the TD MySpend app, can also help track your spending for some of the accounts that are linked to them through your financial institution. These types of apps can provide real-time notifications of transactions made on these linked accounts to help you keep track of your spending in real time.

By understanding when it may be best to use your credit card, debit card or cash when travelling, you can have more time to focus on what matters most — making the best of your getaway.

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