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So you’ve picked your destination, booked your flights and packed your bags. Planning a trip is always equal parts exciting and stressful as you figure out the logistics. One thing many people fail to look into is how they’ll handle their money when they’re away. Whether you’re traveling abroad or one state over, you need to figure out the best way to make purchases during your trip. Here are some of the more common options, along with their pros and cons.

Cash

Arguably the easiest way to pay for things while traveling, cash also has drawbacks.

Pros — If you’re good at estimating how much you spend on travel, cash might not be such a bad idea. If you can make one trip to the ATM and be done, that’s probably the fastest and least obtrusive way to deal with money when traveling.

Cons — Taking out a wad of cash isn’t the best idea, for safety reasons. It’s probably better to make multiple trips and carry only as much as you need in case it gets lost or stolen. Remember, if you’ll need foreign currency, your bank may charge you a foreign transaction fee to take out cash. There may be additional fees associated with taking cash out at foreign ATMs as well. Check with your bank before taking money out and learn some credit and debit card tips for overseas travelers.

Credit Cards

Credit cards offer a fairly stress-free way to deal with your finances when traveling — but beware user fees.

Pros — Paying with a credit card means never having to worry if you have enough money for goods or services. Paying with your credit card also usually offers you a level of protection that cash doesn’t. Check with your provider to determine their policy on trip insurance or if they have any travel discounts. If your card is lost or stolen, you won’t be responsible for charges you didn’t make. If your card has a good rewards program, you’ll earn those rewards with every purchase you make. (Be sure to keep an eye on your credit score for any unexpected changes. They could be a sign of identity theft. You can check two of your scores free on Credit.com.)

Cons — Even if you plan to make credit cards your go-to payment method during your trip, it’s a good idea to have a little cash, for things like cab rides and tips. The other downside of credit cards: foreign transaction fees. Many credit card companies charge fees for every swipe in a foreign country, which can add up. Check with your bank for specifics. (Here’s how to avoid currency conversion fees.) You might also want to look into the best overall travel credit cards of 2017, as well as the best international travel credit cards, if you travel abroad frequently.

Prepaid Travel Cards

Prepaid travel cards may not be as popular as other payment methods, but they’re becoming widespread and may be worth looking into for your next trip.

Pros — Details vary based on the issuing bank, but in general, these cards all work the same way. You can purchase your prepaid travel card online or at your bank. Activate and register your card, then load it with whatever amount of money you want. You can add more later online in most cases, assuming your card is reloadable. Be sure to ask, as prepaid travel cards carry limits. Most prepaid travel cards come with additional perks. Check with the bank to see yours. They also typically carry the same protections as your regular credit card like zero-liability protection.

Cons — You need to track of how much you spend on your prepaid travel card since it comes preloaded with a set amount of money — a good thing for big spenders. Also, unlike a regular credit card, you need to reload your card with money when you run out. You’ll likely incur foreign transaction fees, and some companies charge higher fees for prepaid travel cards.

Traveler’s Checks

Traveler’s checks work in a similar way to cash, but offer more protections.

Pros — Unlike cash, identification and signature verification are required to cash traveler’s checks, and if they’re lost or stolen, the issuer will usually replace them without a problem.

Cons — You may pay a small transaction fee to pick up your traveler’s checks, but in most instances if you’re getting them from your normal bank, they will be free. As with cash, you must make an educated guess on how many you’ll need for your trip. Additionally, while travelers checks are accepted at the same rate of exchange as cash, not all places accept them. Do your research before you decide to use this method of payment. It likely won’t be the only one you’ll need on your trip.

Image: RossHelen

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