By Trent Hamm
One of the biggest challenges of traveling today is traveling safely. The simple act of travel puts your finances at risk, whether from direct theft, identity theft, pickpocketing or other nefarious strategies. You need to be smart, and you need to be careful.
I have traveled throughout the U.S. and to a number of foreign nations on both personal and professional trips. Along the way, I've come to rely on a handful of strategies to keep money safe. Here are five things to do whenever you travel far from home.
1. Inform Your Banks, Credit Card Issuers Before You Go
When you go far away from home, it's always a good idea to inform your bank and your credit card companies.
Why? Your bank may notice that your card is being used for transactions internationally and shut down your card without notice or with minimal notice, leaving you without a card in another part of the country or in a foreign nation. That can be a big problem.
A simple phone call to your banks and credit card companies before you travel can go a long way toward preventing a headache if your cards get canceled due to an unexpected charge from an unusual location.
2. Carry a Minimal Wallet
There's no reason for you to be strolling about in unfamiliar territory with all your credit cards and all your money in your wallet. It's just a bad idea. A simple pickpocket or thief can put you in a seriously compromised position.
A solution to this problem is to only carry one credit card when out and about. Leave a second card -- from another issuer -- in a safe place back at the hotel, ideally in a safe if one is available. If you're not driving, leave your drivers license in a secure place, too. That way, if one item gets stolen, you have backups.
3. Separate Your Money
Another strategy is to separate your cash and not keep all of it in the same place. While traveling, I leave some of my cash in a few different places in my room, vehicle and hotel safe. That way, if I were to get pickpocketed or be the victim of some other kind of theft, I'm not in an immediate disastrous situation. I also often keep a small amount of cash wadded up in the toe of my shoe (like a single $50 bill) in case I need it in an absolute pinch. Sadly, it has come in handy.
4. Use a Money Belt
Still, none of these strategies actually keep your pockets safe from prospective thieves. The solution to that is to use a money belt. A money belt is a pouch that wraps around your torso underneath your shirt, keeping your key belongings in a safe place that's difficult for anyone to get to. A thief can't touch a well-placed money belt.
I use the Eagle Creek money belt. If I'm going to need a credit card, I'll excuse myself to a restroom before a purchase, remove the card from the money belt, use the card, then return to the restroom to restore it. I also keep most of my cash in there, extracting any shortly before a purchase might occur.
5. Use a Credit Card for Purchases, Not a Debit Card
A credit card offers many financial advantages for purchases over a debit card in any situation, but that's never quite so true as when traveling.
For starters, a credit card is not linked to your savings or checking account, so a fraudster couldn't gain any direct access to your personal banking accounts. Credit cards also offer consumer protections against fraud that often do not extend to debit cards, even ones with a Visa or a MasterCard logo on them. This includes things like fraudulent charge protection, which can really help if your bank can't contact you when you're traveling.
When you return home, don't forget to pay off the balance in full. That way, you won't pay interest and you can accrue credit rewards if you have a rewards program.
Trent Hamm is the founder of the personal finance website TheSimpleDollar.com, which provides consumers with resources and tools to make informed financial decisions.
By Trent Hamm