The Best Way to Withdraw Cash While Overseas

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Have you ever come home from a trip abroad and been shocked to see fees on your bank statement?  It’s not a fun way to end your vacation!

Most US banks add currency conversion fees of 1% to 3% for using ATMs abroad.  And sometimes, there’s an ATM fee of ~$3 to $5 in addition to the foreign exchange fee.  These fees can put a dent in your plans for Big Travel with Small Money!

The good news is some checking accounts do NOT charge currency conversion fees.  And they’ll even give you a rebate for any ATM charges anywhere in the world!

I’ve made a list of the best checking accounts to use overseas.  And I’ll compare these accounts to help you decide which option is best for you!

What’s a Hard Pull and Why Does It Matter?

One thing to consider when opening any account, like a checking, savings, or credit card, is whether the bank does a “hard pull” on your credit report.

Banks access or “pull” your credit report whenever you apply for credit or open certain accounts.  These pulls are either “hard” or “soft.”

Hard pulls (or inquiries) happen when you’re applying for credit, like when a bank checks your credit report when you apply for loans, credit cards, or mortgages.  And sometimes when you open a bank account.  Hard pulls can impact your credit score.

There’s a soft pull when you check your credit report, receive pre-approved credit card offers, or go through an employee background check.

Soft pulls do NOT affect your credit score.

So you have to be aware of these pulls when applying for credit cards and opening bank accounts!

3 Best Checking Accounts to Use Overseas

1.   Charles Schwab Checking Account

Link:   Charles Schwab Checking Account

Link:   My Review of the Charles Schwab Checking Account

One of the best free checking accounts to use overseas is the Charles Schwab Checking Account.  That’s because you’ll get free, unlimited use of ANY ATM worldwide.  And NO foreign transaction fees on purchases!

Your daily transaction limit is $15,000 and you can withdraw $1,000 a day at ATMs.

You’ll also get:

• No-fee overdraft protection
• No minimum balance requirements
• Free checks
• Free mobile check deposit
• Free bill pay
• Chip-and-PIN technology

There are a couple of things to keep in mind, though.

You will receive a hard pull on your credit report when you open this account, which can cause your credit score to temporarily dip.  I spoke with 3 representatives at Charles Schwab to confirm this.

You also must open a Charles Schwab investment account.  But, it’s free and you don’t have to use it.

Also note they’ll apply the fee rebates to your account once per month, when your statement closes.

I’ve used my Charles Schwab debit card to withdraw cash at ATMs in Mumbai and Hong Kong.  And I’m always happy to see the reimbursement for ATM fees on my bank statement!

2.   Fidelity Cash Management Account

Link:   Fidelity Cash Management Account

Like the Schwab checking account, you’ll get free use of ANY ATM worldwide with the Fidelity Cash Management Account.

But you WILL be charged a 1% foreign transaction fee on purchases!

Your daily transaction limit is slightly lower too: $10,000 in purchases and $500 in ATM withdrawals.

You’ll also get:

• Free overdraft protection
• No minimum balance requirements
• Free checks
• Free mobile check deposit
• Free bill pay
• Chip-and-PIN technology

This account may be a better choice for some because it does NOT require a hard pull on your credit report.  That’s good for folks who may soon be applying for mortgages, for example.  And who are trying to limit the number of hard inquiries on their credit file.  

This would be a great option if you have or are considering the Fidelity 2% Cash Back Visa card.  Because you can deposit your cash-back rewards into this account!

3.   Summit Checking by Aspiration Bank

Link:   Summit Checking Account

When traveling outside the US, the Summit Checking Account is a newer option for folks who want to withdraw cash without fees.  Like both the Schwab and Fidelity accounts, you’ll get free use of any ATM anywhere in the world.

BUT, anytime a transaction is made in non-US currency, there’s a 0.2% fee.  If the transaction is done in another country, there’s an additional 0.9% fee.  So most of your foreign travel charges are going to have a rate of 1.1% – but remember, you’ll be reimbursed for any ATM fees!

The non-US currency 0.2% charge (while negligible) might be important to some folks who make overseas charges while they’re in the US.

Your daily purchase limit is only $2,000.  And the daily ATM withdrawal limit is $500.

And they don’t offer overdraft protection.  So your purchase or withdrawal will be declined if it exceeds your account balance.

Because Aspiration Bank is still new, they don’t yet have bill pay and mobile deposit options.

Two good things about this account are they have higher checking account interest rates than most other banks (0.25% on balances up to ~$2,500 and 1% on balances above $2,500).  And opening an account does NOT require a hard credit inquiry.

Interestingly, they suggest you pay whatever you’d like for their service.  So essentially this IS a free account if you decide not to pay for it.

The concept is intriguing, but the other 2 options are better.  Because they have bill pay, mobile deposits, and overdraft protection.  

Other Checking Account Options

I looked into what fees these banks charge, too.  So you wouldn’t have to!

Ally Bank

Ally Bank reimburses up to $10 in ATM fees each statement period and charges 1% in foreign transaction fees.

Bank of America

Bank of America charges an ATM fee of $5 plus 3% of the amount withdrawn and has 3% in foreign transaction fees.

Bank of Internet USA

Bank of Internet USA charges a 2% foreign transaction fee and doesn’t reimburse for any ATM fees.

Chase Bank

Chase Bank will charge you $5 plus 3% of the withdrawal amount in ATM fees and a 3% foreign transaction fee.

Citibank

Citibank charges $2.50 plus 3% of the amount withdrawn from an ATM overseas along with 3% in foreign transaction fees.

PNC Bank

This isn’t a good option because they charge 3% in foreign transaction fees and $5 when you withdraw cash at a foreign ATM.

Simple

There’s a 1% foreign transaction fee to use your Simple card overseas.  And they don’t reimburse fees charged by out-of-network ATMs.

TD Bank

TD bank does NOT charge foreign transaction fees but you’ll be charged $3 for using an out-of-network ATM.

USAA

USAA charges a 1% foreign transaction fee and you won’t be reimbursed for ATM fees incurred while outside the US.

US Bank

US Bank charges 3% in foreign transaction fees and $2.50 plus 3% of the amount withdrawn from an ATM overseas.

Wells Fargo

Wells Fargo charges a $5 ATM fee and 3% in foreign transaction fees when using your debit card abroad.

Bottom Line

The Charles Schwab Checking account and Fidelity Cash Management account are terrific options for folks who want to withdraw cash abroad without paying extra.  Because it’s no fun paying fees while you’re on vacation!

The main difference is Fidelity has a 1% foreign transaction fee and Charles Schwab doesn’t.  You’ll also get higher daily spending and ATM withdrawal limits with the Charles Schwab account.

But you WILL get a hard pull on your credit report when applying for the Charles Schwab account.  And you won’t when opening the Fidelity account.

The Summit Checking Account is an interesting option.  But it’s too new to have all of the account perks I like, such as bill pay and mobile deposit.

Do you have any of these accounts?  Share your experience in the comments!