With the British pound hitting a record low against the US dollar in September, it’s more important than ever to have options for spending your money abroad. Although multicurrency cards have been around for years, they could be a secret weapon for saving money in a currency crisis.
Users say they are an ideal tool when currencies fluctuate, allowing you to buy currency when it’s high. With many different options available, which card is best to fight back against a currency crisis?
What Are Multicurrency Cards?
Multicurrency cards are prepaid cards that allow you to load multiple currencies onto one card. These cards can be helpful if you frequently travel to different countries and want to hedge against currency fluctuations or deal in various currencies regularly. When you use your currency card, the funds will be automatically converted into the local currency at the current exchange rate.
Multicurrency cards can be used for both online and offline purchases. The card will automatically select the correct currency. If sufficient funds are not available, you can choose from other currencies you have loaded.
One of the main benefits of using a multicurrency card is avoiding paying foreign transaction fees. When you use your card to purchase a foreign currency, these fees are typically charged by your bank or credit card company. With a multicurrency card, there are no such fees.
Multicurrency cards are not the same as banks. Banks typically charge foreign transaction fees when you use your card to purchase a foreign currency. You should be aware money protection differs. Multicurrency cards allow you to load multiple currencies onto one card, while banks typically only offer one cash per account.
Another benefit of multicurrency cards is that they can help you hedge against currency fluctuations. For example, you load 100 US dollars onto your card. If the US dollar weakens against the British pound, you will still have the same 100 US dollars worth of purchasing power. Many users agree they are a good tool to save money: “We bought Turkish Lora when it was high with card and then used card in restaurants and shipping on holiday,” Says Cath Roberts, a Wise Customer.
It’s not just Wise users who are happy. Julia Regensburg, a Revolut user, said, “I opened a Revolut account for my semester abroad, and I’m really satisfied. Exchanging currencies is done in 2 seconds and saved me a lot of money already.”
How to Choose the Right Multicurrency Card for you
Before signing up for a multicurrency card, it’s essential to research to understand what is available. There are many multicurrency cards on the market, so how do you know which one is right for you?
The main things to look out for are:
- The fees associated with the card
- The currencies that are available on the card
- Where you can use the card
Most Popular Multicurrency Cards
Here is a quick overview of the three most popular multicurrency cards, based on a study by CMC Markets. All three offer free foreign transactions free and currency exchanges and no monthly fees. They all provide free ATM withdrawals up to £200 per month before charging any fees, and provide dedicated mobile apps, making it easy to track spending and top up your balance.
Revolut
Revolut provides access to 150 currencies, in more than 150 countries.
- It can hold up to 25 different currencies
- It can be used as a cryptocurrency app.
Wise
Previously known as TransferWise, Wise is open to more than 40 currencies and be used in 130 countries worldwide.
- It can hold up to 27 different currencies
- It can be used in over 130 countries
N26
N26 is a multicurrency card with access to more than 40 currencies, in 130 countries worldwide.
- It can hold up to 31 different currencies
- It can be used in over 130 countries
Is Your Money Safe?
Although multicurrency cards are not bank accounts, because they are issued by banks, they operate in some of the same ways. For example, the rules that govern a multicurrency account are set by the authorities of the country where the account was opened. If you open a multicurrency account in the UK, it will be regulated by the Financial Conduct Authority (FCA).
Some newer banks may not have as much protection as older banks, but they may offer more flexible features. For information on how your money is safeguarded, check the FAQs section of your chosen provider.
What Are The Alternatives?
In addition to multicurrency cards, a few other options are available for travel money. These include:
- Credit cards: some credit cards offer foreign transaction fee waivers or rewards points that can be used towards travel expenses.
- Debit cards: some debit cards offer foreign transaction fee waivers or rewards points that can be used towards travel expenses.
- Prepaid travel cards: prepaid travel cards can be a convenient and safe way to carry money when traveling. They can be used anywhere that accepts Visa or Mastercard and can be easily reloaded.
Although they offer competitive travel rates, the major drawback for these alternative methods is that the exchange rate is set at the time of purchase. If you traveled to Britain a lot and wanted to get some currency at a steal, you wouldn’t be able to, as the rate is set when you load the card.
If you frequently travel to different countries or want to hedge against currency fluctuations, a multicurrency card is an excellent option, especially in a currency crisis. Set up alerts within your app to buy currency at the optimum price and spend abroad, knowing you have the best price.
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This article was produced by MeMoreMoney and syndicated by Wealth of Geeks.
source https://wealthofgeeks.com/currency-crisis/
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