My Top 5 Money Mistakes I've Made
I'd like to say that some of these mistakes were years ago when I first started to travel but sadly even today I make the odd mistake.
Money mistakes are some of the hardest to recover from as usually once you are travelling there isn't much possibility of making more or clawing it back. Read on about inattentive, daft and straight out stupid money mistakes I've made over the years. Hopefully this will help you not to make the same ones!
Using My Debit Card Badly
I'm well aware that there is typically about a 3% exchange rate added to any international credit card transaction you make. The reason I'm usually not overly concerned is that I get charged the same percentage on cash out anyway, so if I use cash, I've still paid that 3% on that money.
Knowing that I also get points on every dollar I spend on my Visa I consider that is an added bonus and kind of makes up for the 3% fee. A few years ago I decided to get one of the new “no foreign currency fee” debit cards available. I loved this card and figured that the lack of points would be outweighed by the lack of transaction fees so we went off the Iceland debit card firmly in hand.
Iceland is one of the most expensive places on the planet – and I say that as an Australian where the cost of living is very high. Fortunately about day 6 I logged on to check my card balance and noticed all these exchange fees. WTF?? I immediately got on to chat with the bank only to discover that yes the transactions are fee free, but the 3% exchange rate fee still applies.
I had a meltdown and sent them a screenshot of their webpage that stated no international transaction fees. She insisted that no there were no ATM transaction fees or international card use fees, but that the exchange rate percentage wasn't a fee. It was charged by Visa for the facility.
Even though my card was a Debit Card it was still a “Visa Debit Card”. I'd paid for every single thing we had done in Iceland with this card and had paid $200 in currency exchange fees to date.
I know that's not a massive amount of money but I was incensed that they had hidden that. They are a bank and of course wouldn't budge, but fortunately I still had the screen shot on my phone when I got home. When they wouldn't move on refunding me I went to the Ombudsman who is like a governing body in Australia.
I pled my case that somewhere on that page they should have stated that the 3% currency exchange rate would still be charged and they hadn't. About 3 months later, I mysteriously got the exact amount of the exchange rates deposited into my account and they have since adjusted the working on their landing page.
It was a valuable lesson to learn and I'm so grateful that it only cost me a small amount of money.
How I get Around This
Now I keep my savings in my bank account and when the exchange rate is decent I move it to my Wise multi currency card. Then when I use it overseas I use it in the currency for where I am (wherever possible) and know that what money I spend is the money I spend with no extra fees coming my way. They have something like 95 currencies you can convert your funds into so its great!
You can also open “bank accounts” in more than a few currencies which mean you can receive and pay into other accounts in that country for free. I just paid 1500 GBP to a UK based company for a trip I'm doing in South America next year and I just logged in, went to my UK account and paid them from it. No fee and it took me maybe 2 mins.
There is a small conversion fee for moving between currencies.
If you need to work out what a transaction will cost you use Visa's Exchange Rate calculator.
Paying For Flights In The Wrong Currency
OMG this one has gotten me twice. Each time to the tune of around $1000 AUD.
The challenge we face as Australian's is that our currency symbol is the same as the US currency symbol. I imagine New Zealanders face the same challenge. What that means is that you can be on a website and see the amount you are spending on your flight or accommodation or whatever you are purchasing, only to find out when it appears on your credit card that it was showing USD!
I had to get home from West Africa in a hurry about 5 years ago and booked a flight from Conakry in Guinea to Brisbane. It seemed pretty decent in price. It went Conakry to Dubai to Brisbane and was about $2100 with Emirates. That's a long way and Emirates is never the cheapest option but it was only one stop and took me about 24 hours to get home. I could have got it for as little as $1300 but that was with 4 stops and over 44 hours travel. I was happy to pay the extra for a more direct flight.
However, when I got home and checked my credit card it was just over $3000 AUD. I still had the booking and the screenshot from my booking (very dodgy internet and I needed to be sure I had a booking number in case the email never arrived) so I got in touch with the booking agent only to find out that the price was in USD. I could never find anywhere that it had specifically stated USD but they were a foreign booking agency and I had no legs to stand on legally.
I had it happen again with some accommodation last year. I always have my currency set to AUD however I got hacked last year and had to have the provider reset my account. I never considered that it would change all my settings and I booked some accommodation not realising the price was in USD.
After I'd paid for it the receipt did say USD but when I went back it never said that before I paid. They seem to have fixed that now, however it was more than a month of fighting it out with them before they reluctantly agreed to refund me the difference. Again – a screenshot saved me.
I had screenshot it to send to my husband for him to check (it was a booking for a work trip for him) and fortunately I still had that buried in my downloads. Nowhere on that page did it say USD before I paid so I got the difference refunded. It would have been over $800 too!
How I get around it now
After having done it twice I'm crazy about checking currency options on the page of anything I use. It is so easy to get caught especially if its a platform you use regularly. Sometimes they only have symbols like €, $ or £. If that is the case I change it to £ which is usually almost double AUD.
Assuming Travel Insurance Will Cover You
Years ago we spend 3 months in South America. It was an amazing trip however Brad got pick pocketed in Santiago in Chile. It was like 99% his fault. We knew it was a huge pickpocketing area but arrogantly he insisted that he would “feel something” if someone was trying to pickpocket him.
Despite my ongoing statement that what he was saying pretty much explained the term “pickpocket” he left the hotel with his wallet in the outside pocket of his day pack. I'm still smarting over this one! We had about $1200 USD between us as we had to go and pay for a hiking trip we were doing in a few days.
They only took cash (this was around 2001) and not wanting to visit an ATM and then walk 5 blocks to the agency we took the money out in stages over the week prior. I had mine stashed in a zip lock bag down the front of my jeans but Brad thought he knew better and (unbeknown to me) had his in his wallet. OMFG!
Anyway within 2 blocks of leaving the hotel I noticed that his backpack was open and – you guessed it – his wallet was gone. I was LIVID and in the end we had to go to the ATM on the street anyway to get the money to cover what he'd lost.
We also spent the next day cancelling all the cards that were in his wallet and we also realised they had taken a camera as well so we had to visit the police station and get a report for travel insurance.
I can't remember the exact amount but we had to pay a fee for a card to be delivered to a bank in Brazil and other fees to replace drivers licences and the like when we got home. It wasn't much but between the camera & cash it added up quick.
When we got home we lodged a claim with our insurance only to find out that we were only covered for “robberies” and pickpocketing isn't included in this. If they had punched Brad in the face, we would have been covered but seeing as they didn't we had no proof that anything had actually occurred.
In addition to this they insisted that we needed to prove that we even had the items we “claimed” were stolen. What a farce! While I kind of understand that people must lodge fake claims, the fact that we had to replace 3 or 4 cards, a drivers licence, a boat licence and other items should have been proof enough but no, according to our insurance we could have just been careless and lost them.
Despite this, I would never travel without Travel Insurance and I'm older and more insistent these days. Now I would get the police report even if only for travel insurance purposes and I would insist we were robbed. Just because we didn't get hurt doesn't mean it wasn't a robbery.
I now realise this was a less than ideal insurance provider and was their first salvo in a round of “why we won't pay you”. Now I would fight back HARD but then I thought it was declined and walked away. NEVER let a lack of experience change possible outcomes. If you don't know someone else will. With Facebook groups and online communities now you could easily get advice about what to do next.
UPDATE 2023 – I have an annual travel insurance policy that I've always kept and just added in an extra policy for somewhere out of the way via World Nomads. This annual policy is virtually useless now and I won't be renewing it. Why? It doesn't offer any COVID cover at all and most countries you can't get in without a specific COVID medical cover. It is probably half the cost of an annual policy through World Nomads, but as it doesn't work anymore I won't renew and will just get trip policies in future.
!! If you have an annual policy you also need to check how long it covers you for. Brad also has annual cover through his business as they used to travel quite a bit, but we recently noticed that it only covers you for trips of 60 days or less! This cannot be changed so again – that won't get renewed either.
Getting Caught Out With Rental Car Insurance
Fortunately this wasn't me, however it could very easily have been. A close friend came very unstuck with rental car insurance a few years ago. They had excess cover through their credit card insurance so assumed they were OK. However, when a drunk driver with no insurance smashed into them in Florida it became very clear that you need to read all the fine print on these type of insurances.
Thankfully he only had a broken arm and was the only person in the car at the time, but the car was pretty much a write off. The rental car agency was amazing and got him to hospital, got the car towed, replaced the groceries that he had just purchased, and a replacement car delivered to them within 48 hours. They also reinforced that only the excess in the rental agreement would be charged.
He was quite relieved when they said it would be charged at the end of the rental period which was about 10 days away. He made sure he had that amount available on his credit card and they continued on their holiday. He notified the bank insurance that a claim was on the way and they very nicely replied that they were happy for him to lodge it after his return from the US.
When he did lodge the claim, within a few hours he received a reply highlighting some small print on the policy. To ensure any excess was covered he would have had to take all and any EXTRAa insurance offered to them on the car at the rental counter. So effectively he would have had to pay the rental car fee to reduce the deductible (excess in Australia) to zero and then if there was any extra fees the bank insurance would have covered it. What a rort!
They clearly state they cover any rental car excess but when you go 7 pages down it states that you have to take the extra cover from the rental car company before they will pay any difference.
Why would you need to claim if you had already paid the rental car company for the same cover??
I use Rental Cover to reduce the excess on any hire car I get and its WAY cheaper than what I would pay at the counter. I got it for a 10 day hire recently and it was $97 AUD to reduce the excess to $0 and at the rental counter it was $35 per day. So $97 compared to $350.
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Spending money on custom clothes or shoes
Despite searching extensively Brad got very ripped off in Hoi Ann in Vietnam. Hoi Ann is known as the tailoring capital of the world, however it is very difficult to get what you want (exactly) and know what the quality will be before you pay the deposit.
Some of the tailors have these lovely clothes in the window and you would assume that these clothes reflect the quality of what you will get, however its not necessarily the case. Check out the story here, but take my advice and save your money. There were 4 of us on that trip and we met maybe 6 other people in Hoi Ann that had tailoring done. None of us got what we wanted. Those are stats not to be ignored.
Brad's coat wasn't cheap and was nothing like what he wanted and I got 2 pairs of boots made that were just rubbish. When I went back to get them they didn't even fit, the zip wasn't where it was supposed to be and the material was completely different to what I'd chosen. They know you are a tourist and they are never going to see you again so as a rule they just don't care.
I refused to take one of the pairs of boots as they had clearly stretched them and the stitching was coming apart even then, and the other ones I wouldn't pay what they asked. Brad refused to pay the balance of his coat for similar reasons and they pretty much threw us out on the street and then threw the coat after us. Talking to people later, its a common occurrence.
I think it cost us about $220 USD for the exercise and trust me when I say that goes a long way in Vietnam.
Flying Domestic and International On the Same Day
People often look at me strange when I say I try to avoid flying a domestic route that connects with an international one on the same day. I'm sure it feels like a weird overkill thing, but the couple of times I've done it has cost me thousands!
I flew from Fukuoka to Busan, and then Busan to Seoul a few hours later. I had allowed maybe 4 hours between flights and Japan and South Korea aren't miles apart so I wasn't concerned about flight delays really. I was flying from Fukuoka about 1pm and had a flight to Seoul at 6ish. The flight to Busan was delayed for 40 mins. No drama – that's why I allowed 4 hours between flights.
Then it was delayed again.
I tried to get my luggage back at this point because I could fly with another airline but because it was checked in I couldn't get it back. So I headed to the airline counter to try and change my Busan to Seoul flight. The language barrier meant that for whatever reason that wasn't possible either.
I wasn't too stressed, its not the first time I've slept in the airport, but I did try and call my accommodation and let them know that I would be late arriving. Their phone number didn't work. I figured they had just gone home for the afternoon as it was a Sunday. Again I wasn't too stressed because I'd booked a week's accommodation so to arrive 12 hours late wasn't the end of the world.
I finally got to Seoul the next morning and when I got to my hotel to check in my booking had cancelled at midnight because I didn't show. That enabled my room to be rebooked by someone else and I had no accommodation for the week. It ended up costing me double what I originally paid because everything was booked solid.
I always have a contingency for this and fortunately I had booked through booking.com who went into bat for me. I did end up getting my 5 nights back and they kept the first nights fee, even though I could show I had notified them by 2pm.
I could have lodged a travel insurance claim I guess but regardless, I never fly domestic with an international connection now. The only exception is if there are multiple flights servicing the same route in the time between my domestic and international flight. If I fly Gold Coast to Sydney at 9am and there are 10:30, 1pm and 1:45 flights as well I might do it knowing I've got the back up.
How I avoid this now.
I usually like to fly longer legs during the day anyway so I will often arrive in the city I'm leaving from the evening prior just to be sure. Yes this does mean a hotel cost but compared to loosing an international flight – so worth it!