We have crappy credit because John got divorced once when he was young and he and his ex shared some debt that ended up in collections for over a year while the divorce went through. Then, after the divorce, John’s dad took my life savings up to that point (money I’d earned working in long-term care facilities as a certified nursing assistant as a teenager in high school) to pay off the bad debt. John’s dad must’ve had second thoughts after I wrote the check for $8000 (it was everything I had) and decided instead to call all our debtors and tell them we’d declared bankruptcy. Ever since that time, we’ve had bad credit. Credit-wise it’s like we declared bankruptcy without having had any of the benefits of declaring bankruptcy.
The silver lining to this cloud is that we learned from an early age not to use credit cards. Over the past five years, I’ve acquired several though, for use only for car rentals or emergencies when other forms of payment aren’t available. Anyone who wants to travel long-terms should realize that using credit cards and having ongoing loan payments can lead very quickly to NOT traveling. I have one Visa, one Mastercard, and a Discover card in my stash. Whenever we use these cards, I pay them off immediately in full.
Having a credit card or two can be a lifesaver when you’re traveling. They tend to be easier to use than a lot of debit cards in a pinch.
Debit Cards and Banks That Are Friendly to Travelers
My favorite bank that we’ve used over the years is Charles Schwab because the debit card can be used at ATM’s worldwide and the fees are refunded (or at least they always have been in the past). Recently though, in Mexico, I’ve had a lot of trouble getting money from an ATM using the Schwab card. In fact, this problem started in India on a trip abroad in 2016. When we got home, I started working on getting a bank account at HSBC so that we would have a back-up plan, just in case the Schwab card stopped working entirely.
The Schwab cards works well when I give it to merchants, so long as I call them in advance and tell them where I’ll be traveling. Otherwise, I end up being stonewalled out of my accounts en route between point A and point B.
HSBC is a bank based in Hong Kong, but they have branches all over the world. We see HSBC ATM’s at nearly every airport we go to because it’s one of the largest banking organizations in the world. HSBC has offices in more than 80 countries in Asia, Europe, the America’s, Africa, and the Middle East.
As long as I use my ATM card at an HSBC ATM, they don’t charge a fee, or at least that’s been my experience so far while living in Mexico. I signed up for an HSBC account that requires a minimum balance and ongoing deposits of at least $10 a month from a business account because it’s free as long as these requirements are met. If you don’t have extra funds to maintain the minimum balance, you may need to suck it up and just pay the monthly fee. That’s one of the big drawbacks of HSBC, in my opinion, but I like having the ATM cards available just in case our other debit cards don’t work.
Debit Cards for Traveling Kids
My daughter, now 17, goes out on her own to work in Mexico and so she needs access to funds that she can rely on. It’s been challenging to get her a debit card that will work at ATM’s reliably without charging a fee. I signed her up for a custodial account at Charles Schwab, she has an HSBC ATM card attached to our account and she has a credit card from a bank that we use for savings (the bank charges fees at ATM’s so there’s no use listing it here).
Americans, Europeans, and Canadians who travel perpetually need to develop a banking strategy that will allow them to withdraw money from an ATM without lots of fees (which can add up fast) and to make purchases directly from merchants without having their card declined. The best debit cards available to citizens of these countries (in my opinion) come from Charles Schwab and HSBC. Having a Visa and a Mastercard is also important if there’s any chance you plan to rent a car overseas. It’s essential to have more than one financial resource when you’re traveling abroad.
Be sure to get started on the process of acquiring bank accounts and debit cards at least one month to six weeks in advance of your travel date because it can take a while to get through all the red tape. Or call the banks to ensure that your cards will arrive before you plan to leave. It’s a hassle, but once you’ve done this part things will be much easier as you start your new life as a digital nomad!
John Talks About His Remote Work (video)