Home > Personal Finance > Are Traveler’s Checks Still a Thing?

Comments 1 Comment

According to a 2015 Experian report, nearly 20% of travelers had sensitive information lost or stolen during their trips. One way people are combatting this is by using traveler’s checks in place of cash or a credit or debit card.

What Are Traveler’s Checks?

Traveler’s checks are used as a currency replacement for those who don’t want to carry cash or use an alternative form of payment. To get one, you’ll pay the amount of the check and an issuer service fee to the bank. Once you’re ready to access the funds, you sign the check and hand it over for cash at a local bank or retailer. American Express began circulating traveler’s checks in 1891 and is still the largest issuer to date.

Benefits of Traveler’s Checks

Anonymity: Each traveler’s check has a serial number and a person’s signature for identification purposes, but, other than that, information about the owner remains unknown. Using credit while traveling may put you at risk for fraudulent charges and identity theft, two consequences that you won’t need to worry about with traveler’s checks.

Exchange Rates: International travelers may purchase traveler’s checks in their destination’s currency, reducing the confusion of exchange rates and sometimes fees in the process. This is especially helpful in remote countries where exchange rates are high and bank access is limited.

Avoid Transaction Fees: Many credit card providers charge transaction fees for purchases made outside the U.S. Traveler’s checks remove this possibility before your trip begins.

Child Safety: Allowing your child to travel alone is a big step for any parent, and finding the best way to keep them safe is imperative. Traveler’s checks are a smart solution for kids who are too young to carry cash or credit responsibly.

Easier Refunds: Traveler’s checks are issued to and signed by you directly, and they generally require proof of identification (to be compared to a second signature you make when you go to redeem one) before a bank or retailer will accept them as currency. Lost or stolen traveler’s checks are useless in the hands of a thief, and the issuer will usually provide a full refund.

They Can Serve as a Budgeting Tool: Vacation travel can lead to impulsive spending, but traveler’s checks can help provide a firm stopping point. Unlike credit cards, traveler’s checks represent a finite sum or money, allowing you to stay on budget (whether you want to or not).

Two Main Drawbacks of Using Traveler’s Checks

Acceptance: Traveler’s checks are declining in use, leading banks and retailers to follow suit. Research your trip destination carefully before choosing this payment option. It may cause more problems than you realize.

Convenience: Traveler’s checks may offer safety, but they don’t usually provide convenience. Paying additional fees to spend your own money isn’t ideal, and finding a purchase or exchange location can be a hassle.

The Bottom Line

Whether you opt to use traveler’s checks or another form of payment while you’re on vacation, it’s a good idea to set a budget for yourself ahead of time and make sure you stick to it. No vacation is worth going into credit card debt. You can see how your debt levels are affecting your credit by viewing two of your credit scores for free, updated each month, on Credit.com.

At publishing time, American Express products are offered through Credit.com product pages, and Credit.com is compensated if our users apply and ultimately sign up for these cards. However, this relationship does not result in any preferential editorial treatment.

Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.

Image: Leonardo Patrizi

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • http://www.travel-safer.com/ Travel Safer

    Great article looking at the ancillary benefits of these not often used travel tools!
    I would echo your thoughts that finding a bank to cash these out is a chore; however, I would point out that the refund process is not a quick one – if your cheques are stolen (or lost) you will likely not receive any refund until long after you return home (unless you’re on a long-term trip or study abroad).
    Based on conversations with AMEX representatives, the refund approval time-frame depends on the situation, with the automated system deciding how long the approval
    takes. You then have to wait for funds to be transferred, so expect this to be more than a couple days. *Know that having a police report will not influence the turnaround time at all.
    Cheers!
    JC

Certain credit cards and other financial products mentioned in this and other articles on Credit.com News & Advice may also be offered through Credit.com product pages, and Credit.com will be compensated if our users apply for and ultimately sign up for any of these cards or products. However, this relationship does not result in any preferential editorial treatment.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Our Owners

Credit.com is owned by Progrexion Holdings Inc. which is the owner and administrator of a number of business related to credit and credit repair, including CreditRepair.com, and eFolks. In addition, Progrexion also provides services to Lexington Law Firm as a third party provider. Despite being owned by Progrexion, it is not the role of the Credit.com editorial team to advocate the use of the company’s other services. In articles, reporters may mention credit repair as an option, for example, but we’ll also be sure to note the various alternatives to that service. Furthermore, you may see ads for credit repair services on Credit.com, but the editorial team isn’t responsible for the creation or implementation of those ads, anymore than reporters for the New York Times or Washington Post are responsible for the ads on their sites.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team