Essential financial products that will make your dream vacation easier

When it comes to money, it isn’t enough just to have it. Being able to access it, manage it smartly, and spend it wisely are equally important.

26th Apr 2019
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Many things contribute to creating the ideal vacation. Planning, being with our loved ones, treating ourselves to memorable experiences, comfort and safety - and of course money, which is critical to financing the whole experience.

When it comes to money, it isn’t enough just to have it. Being able to access it, manage it smartly, and spend it wisely are equally important. In strange places, in foreign countries, you are looking to relax and have a good time.


But at the same time, you also want to be financially secure. In case you run into trouble such as theft, robbery, health problems, delayed flights or cancellations, you need a helping hand. This is where some travel-friendly financial products come in to make life easy for you.


Let’s look at them.


Travel insurance


It may take a few lakh rupees to travel to your favourite holiday spot in the world, and just a few thousand rupees to secure it against calamitous situations. Travel insurance can be bought not just for foreign travel but for domestic excursions as well.


A typical travel policy covers loss of passport and baggage, personal accident cover, trip cancellation and interruption, missed flight connection, political and natural catastrophes, and accidental death - and, most importantly, health insurance.


Remember that you may mandatorily require health coverage while travelling to some countries such as the United States or the Schengen nations.


Travel insurance policies have health insurance bundled in them. Health risks are especially important to cover because of the oppressively high costs of healthcare in countries such as the United States.


Travel credit card


A travel credit card is one of your best friends on any trip. A well-bundled card allows you to transact online and at your preferred shopping destinations, and it also provides a host of other services, benefits, rewards, deals and discounts that can make your trip memorable. One of the most common benefits of travel cards are access to lounges at domestic and international airports.


Travel cards also provide travel insurance and accident coverage. Some travel cards offer you airmiles that you can exchange for air tickets. Premium travel cards may also provide lifestyle and consumption-related benefits.


These allow you to access discounted hotel rooms, fine-dining experiences, priority access to events, accelerated reward points on shopping with preferred merchants, discounted movie tickets, and even concierge services that make life easy for you.


Forex card


A forex card works like a debit card loaded with the currency of the country you’re going to. With it, you can make online and POS transactions. Unlike a credit or debt card, a forex card can protect you against exchange rate fluctuations. This is because when you load the card with a balance, you make a lump-sum purchase of the currency at a single price point.


Also, while transacting with a forex card, you’re spending in that country’s local currency and therefore don’t need to pay transaction fees along with applicable taxes – which you do when you use a credit or debit card.


A forex card is also a useful alternative to carrying cash, which, while necessary, can be risky. Ideally, you should divide your currency holdings between a mix of cash, forex card, and debit or credit card to derive the best out of each instrument. Forex cards also come in multi-currency variants where you can hold currencies of various countries in different wallets. Lastly, some forex cards may provide bundled benefits such as travel insurance.  


Debit and credit card


What better than to be able to spend from a reliable instrument you are familiar with? Not only can you make online and POS transactions with your cards, you can also withdraw cash from local ATMs. (Do this only with a debit card. Avoid cash withdrawals with credit cards due to the steep charges.)


For most spending needs, a regular card will do the trick. But before you leave, get in touch with your bank to ensure that your card is open for transactions in the country you’re going to.

Intimating the bank about your travel plans would ascertain that you can transact abroad with the card, and the bank would also not block your card thinking your transactions to be suspicious.


You may be charged a conversion fee on your foreign-denominated transactions. Most cards these days provide benefits, rewards and deals of some kind so it would be best to be in touch with your bank to ascertain these benefits. It will help you cut costs and get some freebies during your trip.


Careful financial planning is key to a good vacation. It’s important to have fun, but if you plan ahead, you can also tackle unforeseen problems and never run out of money in a strange land.





(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.) 

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