When planning our move abroad, to live in Spain, we researched many travel credit cards and felt that the Chase Sapphire Preferred was the best fit for us and our planned lifestyle, with no foreign transaction fees!
A very popular question is about obtaining a credit card and which one to choose. We can’t advise you on which one to choose, but we can tell you what we chose and our reasons. You will just need to take that info and absorb it into your plethora of data and research and choose what works best for you.
First let me start by reminding you that I am a frugal one. I don’t like to pay full price, I don’t like finance charges, I don’t like fees and I certainly don’t like those hidden fees (in the small print). I have not paid a finance charge on a credit card in nearly 20 years!
Look out, you are going to get some extra bonus bits of advice from me to help answer some frequently asked questions and hopefully save you some money..
Tip #1 Don’t ever buy anything on a credit card you don’t have the cash in hand to pay for now.
You must know the dates of your billing cycle and pay your credit card IN FULL within a few days after your statement date. By doing this, you will have ZERO finance or interest fees. A finance charge is money you are just throwing away to the credit card company, so why are you doing that? If you can’t pay cash for it today, then you need to wait. (I know emergencies, but do you get it?)
Secondly you need to understand how we have functioned as a family over the past 16 years. We like to earn “points” on our credit cards for the freebies (Flights, hotels, cash, etc.). In order to do this, you must use the credit card. We live by the rule of tip #1 and we also use our Credit Card for any and every purchase we can. Again, we don’t make that purchase in the first place if we can’t pay in cash for it today. We buy all of our groceries, gas, clothing etc..with the credit card. We don’t make any extra purchases, just to get the points.
Tip #2 Keep track of everything you spend, so you know where to adjust your spending for the next month / future.
We know where our money is going and can view it each month on our statement or daily on-line. So you have to inspect to know what to expect! This is how we have lived for too many years to count. This is how we earned enough miles to get a family of 4 to/from Spain using airline points.
Next you need to keep track of any fees or hidden fees that may apply to your card. For over 15 years we used the Chase United Mileage Plus Card for everything. Once we decided to move to Spain, we took a very close look at the fine print of our terms. Wouldn’t you know it, there was a 3% foreign transaction fee. That means every single time we would use it out of the USA, an extra 3% would be “gifted” to Chase, just because. This fee had nothing to do with the exchange rate, but rather a fee for just have a transaction in a foreign place.
Well as you can imagine, this would add up for us in no time. Everything we purchase for a year and 3% going to Chase for the heck of it? Just think, if we spent only $10,000 in a year we would be giving Chase $300 from our pockets for no valid reason. That is not a deal by my book. We wanted a no foreign transaction fee credit card.
So I spent countless hours researching the web, travel blogger recommendations and credit card fine print. We finally settled on the Chase Sapphire Preferred as our card of choice and could not be happier. We felt this was the best credit card for traveling internationally.
Why did we choose Chase Sapphire Preferred?
- No foreign transaction fees!
- 2x points on travel and dining!
- They use the daily exchange rate
- 50,000 sign up bonus
- Transfer points to participating frequent travel programs with no transfer fees (flights, hotels, etc)
- 7% Annual Points Dividend on all new points earned on purchases throughout the year
- 24/7 Direct access to dedicated service advisors
- +More, the list goes on and on, but this was perfect for us and our life style
- Check their website for current terms offered
We applied for our Chase Sapphire while in the US and still employed. Obviously, this helped to streamline the process as we were employed and for many years. We didn’t care much about the interest rate, as you can see from Tip #1 – We don’t pay any finance fees or interest fees.
Now I am just going to ramble off a few tips that are common sense to me, but worth the reminder.
Tip #3 Apply for the credit card while you still have a job!
If you don’t have a job it may just take a bit longer to be approved or you may be denied. If you are denied, you then need to appeal and ask for a review. If they decide to approve at this point, it will likely be with a very high interest rate. Again, if you follow Tip #1 that is not a problem. If you don’t then you are asking for trouble and being in debt.
Don’t go into debt!
Tip #4 If you are going to be living overseas, do have a billing address in your home country.
You want the credit card to be from your country and pay it from your bank in your country. This way you are not losing money transferring funds around all over the world. Just keep it all in your home country (billing, payment) and purchase anywhere. We have a US bank account and we just pay the credit card in U.S. dollars from that account.
We have a Spanish bank account here denominated in Euros. In order to avoid monthly fees on the Euro account, we have to transfer in 700 Euros a month (around $1000 with current exchange). When we transfer from our US Bank to Spain…the US bank charges a transfer fee as well as a percentage markup on the conversion. For example if the exchange rate is $1.36 to 1 Euro then they will charge us $1.42 to each Euro. Plus a $35 transfer fee. (We avoid the transfer fee by having an investment account with them as well. Unfortunately, we have not found any way around the percentage markup on the conversion).
We prefer to make most of our purchases and charges directly on our international credit card because if the daily exchange rate is 1.36, then that is what Chase Sapphire charges, nothing more.
Tip #5 Ensure you have access to your account electronically and opt for electronic statements.
You do want to keep a close eye on your transactions. A minimum of once a month, but I check almost weekly. When you are traveling, you never know who may get hold of your credit card info and try to make a purchase. We had someone try to purchase 2 flights at over $2000 each and some other small items. We were alerted right away from Chase via email. I looked online and disputed immediately. They cancelled the card and issued us a new one right away.
Tip #6 When making your purchase in the “foreign country” and given a choice of currency USD or EUR for example, choose the foreign currency option.
I always choose EUR in Spain. This way Chase Sapphire is exchanging your currency (at the daily rate with no foreign transaction fee credit card) rather than the bank which provided the vendor the credit card machine. If you choose your home currency, the bank that issued the machine is tacking on that 3% (or more!) fee right there at the register.
Tip #7 Ensure you place a travel alert on your account and keep them informed of where you will be traveling internationally.
You don’t want those foreign fees when traveling internationally. Call prior to your trip, just to be sure you understand all of the fine print.
Tip #8 See what other travelers are doing and how they are using credit cards to their advantage!
Read what is really happening and being used to travel and not just a marketing pitch from the credit card company. Everyone picks their international credit card for a reason, for extra points, miles, no foreign transaction fees, low APR. and so on.
Tip #9 Do your research.
Don’t just take my word for it. Do your research and see what works best for you and your lifestyle.
Thanks to all of our readers that inspired this post and contacted us with questions. Now I have finally written about it and can point people to the post. Yipeee! Happy and Safe Travels for you. Read more info about the Chase Sapphire Preferred Card.
This is 100% our opinion and we are not being paid in any way for this. Being “out there” on the web, many people come across our blog. Of which, several contact us in one form or another with questions about our experience, what we have done, how did we do it, finances, etc.
(Chase if you are reading this, you can fill up our rewards account, if you like)