By Laura McMullen
When your child is traveling abroad without you, you won't be there to help navigate foreign streets or translate menus. But you can help money matters run smoothly without leaving home. Whether your child is going abroad to study or to seek adventure, here's how to make sure there's access to secure credit and cash at a reasonable cost.
How to prepare for a smooth trip
Choose a credit card with no foreign transaction fees. Most credit card issuers charge a foreign transaction fee of about 3% of the purchase price every time you swipe the card abroad. The equivalent of $300 spent on meals, for example, means $9 in foreign transaction fees.
You and your child have a few options for accessing a card that doesn't charge these fees. A college student could apply for a student credit card that doesn't have foreign transaction fees. Co-signing could help your student get approved for these cards (though it's important to understand that, as a co-signer, you're on the hook for payments if your child should ever stop making them).
Another option is applying for a no foreign transaction fee credit card and adding your child as an authorized user. Your child will get a credit card with his or her name on it and be able to spend up to the credit limit, and you'll be able to see what your child is spending. As the account owner, you'll be responsible for making payments.
Whichever credit card your child leaves with, make sure it has an EMV chip -- the rectangular chip that requires you to dip, not swipe, the card at a payment terminal. While this technology is newer for U.S. cardholders, in most parts of the world, it's the standard for credit and debit purchases. Foreign merchants may not be able to process transactions without an EMV card.
Pack an extra card, too. A backup credit card can save your child loads of stress if the go-to card is lost or stolen. A debit card is also a must, because it can access cash at ATMs. Be sure to find out which ATMs can be used overseas without additional fees.
Alert bank and card companies. Contact the bank and describe where your child will be traveling and when. Otherwise, the bank may suspect your child's foreign charges are fraudulent and suspend the card.
How to be smart and safe with money abroad
Keep a low profile. "It can be assumed that any major tourist zone -- be it Plaza del Sol in Madrid or Times Square in New York -- has someone looking to pick a pocket or snatch a bag of an unsuspecting tourist," says Dru Simmons, international risk manager at Ohio State University's Office of Financial Services.
Encourage your son or daughter to keep a low profile by practicing situational awareness -- not calling attention to yourself and avoiding displays of cash, expensive jewelry, electronics or other "indicators of wealth," Simmons says.
The U.S. State Department website has profiles of countries with information for visitors. The safety and security information details for each location provide a heads-up on what risks to expect when traveling and where. That page "often has information on prevalent scams, local hot spots for petty crime and guides to ATM usage," Simmons says.
Divvy up cash and credit cards. Simmons suggests travelers stash credit cards and larger amounts of cash in an internal pocket or money belt and keep less valuable items, such as spending cash and transit cards, in a more accessible wallet or purse. With this arrangement, travelers who are pickpocketed or mugged will lose or hand over something relatively worthless. It's a good idea to keep passport copies in a separate place.