Are Traveler's Checks Obsolete? Here's What To Use Instead
Traveler's checks were once a really popular and useful tool when going abroad—but with the widespread use of credit cards and debit cards, they are no longer as common. A traveler's check is verified by a bank and is used when traveling internationally to exchange for local currency.
"You might pay American Express $100 for a travelers check, and that check is worth $100 based on the amount you've given Amex," says Alex Miller, founder and CEO of travel site UpgradedPoints. "You then go to another country to cash that check and are given $100 in equivalent local currency."
RgStudio/Getty Images
People used traveler's checks as a way to keep money safe from fraud and theft while traveling, as they could be replaced. "Each check has a unique number, so it can be traced easily," says Phil Dengler, co-owner of The Vacationer, a resource for travel and credit card guides. Also, you have to sign the traveler's check when you buy it and when you go to redeem it to prevent fraud—if the signatures match, you get your money.
While most major banks no longer offer them, you can buy traveler's checks through American Express, VISA, and AAA—however, you could have a tough time finding hotels, banks, and stores that still accept them while traveling. Here are some of the modern alternatives to traveler's checks that are available today that will make your life easier and keep your money safe.
What to Use Instead of Traveler's Checks
Traveler's checks can be useful to avoid foreign transaction fees or if you don't have a credit card—but you run the risk of going somewhere that traveler's checks are not widely accepted. There are ways around foreign transaction fees and safe alternatives to traveler's checks so you don't have to carry a bunch of cash with you.
Credit card
Credit cards are a great option for keeping your money safe while traveling. "While credit cards can be lost or stolen, they offer fraud protection absolving you of any unauthorized charges," says Dengler. He recommends getting a credit card that does not charge foreign transaction fees, and sticking to VISA or Mastercard (as opposed to Discover or Amex) as they are more widely accepted.
While it is less than ideal, if you lose your credit card or it gets stolen, "banks and credit card companies have global call centers which can quickly deactivate and replace your cards in short order," says Warren Jaferian, dean of the Office of International Education at Endicott College.
Debit card
Get a debit card that doesn't charge an ATM fee. ATMs are widely available and you can directly withdraw money in local currency—Miller recommends the Charles Schwab Bank card.
However, the safety of using a debit card internationally can be questionable, with experts advising extra caution when traveling to prevent fraud. Jaferian suggests using an ATM inside a bank to avoid skimmers or other devices that can be used to get your card number.
However, your PIN does provide an added layer of protection against fraud—"The modern institution of the Debit Card + PIN is just as, if not more secure, than the traveler's check," says business attorney Ryan Reiffert.
Bottom line: You don't really need them.
For the most part, traveler's checks seem to be a thing of the past. "Personally, I stopped buying travelers checks in the 1990s as secure alternatives became ubiquitous," says Warren.
While they provide safety and can help you avoid high transaction fees, it might be difficult to find places that accept them. If you're able to get a credit card or debit card with no fees, that's your best bet. "Traveler's checks are not as useful as they once were," says Dengler. "They are safer than carrying cash, however." Research your destination to see if traveler's checks are accepted there—if your bank or card charges high international fees, or you don't have a credit card, traveler's checks might still be a worthwhile option to consider.
