Whenever you start traveling abroad, one of the first questions you should ask yourself is what does my banking situation look like. For me, I had been using a small, regional bank for my entire life. However, as I looked at going abroad indefinitely, this wasn’t going to cut it. Foreign Transaction Fees, ATM withdrawal charges, and a lack of a solid website interface meant I needed to look elsewhere. (I did keep the original bank, however.)
This all being said, I think there is going to be some intrinsic value to keeping a smaller bank, just in case. Let’s go ahead and talk about the pros and cons of large, multinational banks, then we will get into some specific accounts (both savings and checking accounts), and finally, we will be covering some credit cards
Table of Contents
Comparing Types of Banks for Traveling
Pros of Large Banks for Travelers
- International presence.
For example, Wells Fargo has branches in South Korea, the UAE, Argentina, and Ireland.
Whenever you are traveling for business or as a digital nomad, access to a physical bank could be a huge advantage to you.
This opens the possibility for better currency exchange rates, no ATM charges, and access to currency if you account is locked.
- Phone Apps & Web Interface
Okay, so is the biggest reason I have a bank account at a large, international bank.
It’s not that small banks do not offer apps for their customers, but large banks have access to millions of dollars to create a high quality app.
Just by having my phone, I can check account transactions, dispute charges, and deposit mobile checks.
The only potential downside to an app is the lack of internet service. But, most places have internet anymore. I even had cell phone service at the top of the highest point in Colorado!
- Different types of accounts
I grew up in a small town.
When you grow up in a small town, you become use to only having one option for everything. One place to purchase gas. One place to eat…
But when you bank at a large, international bank, there may be six different checking account options, two different savings, and credit cards!
Having the ability to choose between different banks can help travelers as each traveler has different needs.
Cons of Large Banks
- Contacting a real person
Whenever you are traveling, it may be necessary to talk to a real person so they can understand your individual situation.
However, this may not be possible at a large bank.
In my experience, I talk to a robot first, then I was placed on hold, and I talked to a person after about 30 minutes!
If the situation would’ve been bad, I could’ve been in trouble!
- Large Banks are not flexible with individual accounts.
Look, it’s nothing personal. However, big banks serve millions of customers every day. Because of this, strict rules were created to maintain profitability. (And to follow the Federal Reserve’s guidelines.)
If you think they are strict now, wait until you buy a house. They have SO many more rules too.
- Larger Banks have higher fees
A larger bank’s primary purpose (especially public ones) is to maximize the wealth of the shareholders.
So, one way in which large banks make money is via fees. This could be avoided via account minimums or meeting a number of transactions per month.
This is extremely important for international travelers. The best banks for international traveling will offer no international transfer fees. (Or even better: NO ATM FEES!)
One more type of fee: Closing account fees! Be careful when you close your bank account!
Pros of Community Banking
- Community Service
Sometimes, there is nothing better than small, hometown service. Especially when you are traveling internationally, you might feel relieved to talk to someone you know ASAP. Plus, this customer service is often quicker, as the bank does not serve as many people.
- They can bend the rules (a bit)
Small banks also have less restrictions and rules than the large banks. (Or they may have a gray area) This doesn’t mean they are going to give you $100, but they might be able to unlock your account faster.
Additionally, they may decide to wave certain fees, like the occasional ATM transaction.
- They support your local community
Alright, this is my favorite aspect of community banks. Community banks only have a few locations, so they want to see the local town grow and succeed.
This takes many forms, from community-style BBQs to small business loans.
My former, community bank offered a back-to-school BBQ tailgate every year.
I don’t think I have ever seen JPM give back to the community in anyway except dividends or through their organized charities.
Cons of Community Banks
- Community Banks are limited
Because of their small size, community-style banks are limited in numerous ways, and this can be disheartening when you need a bank while overseas.
The first major problem is the lack of a (good) phone application.
Like mentioned above, banks spend millions to develop a good app. And small banks don’t have that option.
For me, it is a requirement that the bank has a good app. After all, the bank is probably not open at 3 AM while you are in rural Turkey.
Additionally, these banks are limited in their accounts they offer. I had to switch banks, as my bank did not offer a single debit card that did not charge an international transfer fee. When you live overseas, this is HUGE.
- You may never want to talk to someone from your hometown
Just me? If you’re from a small town and moved away, you would get it.
- Out-of-network ATMs
This could be seen as a continuation of fees, but it belongs in a different category.
International travelers, when out of network, are going to be charged an ATM and an international transfer fee from the bank when you decide to withdraw money. They just lack the networks that large banks have.
Now that we have covered some the pros and cons of smaller vs larger banks, I wanted to provide some specific banking options for digital nomads.
Unfortunately, this section is going to be targeted towards large, multinational banks. (Including the credit card options)
However, please feel free to reach out to your local bank or credit union for their offers, too!
Please note: In this section, I have included a referral link to some products.
Best Savings Accounts for Travelers
- Goldman Sachs Marcus Account
- Capital One Savings Account
However, we are not going to rely on these accounts. Their savings rates will fluctuate with the fed-funds rate, and that rate is wildly unpredictable. As a downside, these accounts are not actually earning anything in interest (really), and most times, these accounts are actually losing money due to inflation.
This is why I only recommend the
- Chase Savings Account*
I am not going to sugar coat it, I am not a huge fan of Chase accounts. However, if you treat a Chase Savings account like an emergency fund, it is good for one reason, Chase Savings Accounts have instant cash transfers to other accounts. The funds are available immediately.
*Only if you have enough money to avoid paying the monthly service fee. Otherwise, look at the Goldman Sachs Marcus or Capital One Savings accounts.
Best Checking Accounts for Travelers
There is only one checking account that I recommend for travelers or digital nomads.
I can say for certain I received my ATM fees back. However, just a warning, they do come back in a lump sum at the end of each month.
Best Credit Card Combinations for Travelers
Now, I grew up in a single-parent household, so there is always apprehension from me on recommending credit cards.
So much so, I pretty much subscribed to the zero-debt policy until I realized I don’t spend more money than I earn, and I was actually losing out on at least 1.5% cash back on every purchase.
If you are in any debt (outside of owning a car or home), I don’t recommend any credit cards for now.
But if you do have some willingness to tolerate credit cards, here is just a few combinations I recommend. (Starting from my favorite to least favorite.)
Please note: I don’t chase subs, unless it’s a $600-$1,000 equivalent.
Capital One Credit Card Duo
I get a lot of flack for thinking that the best credit card options for most travelers is not the Chase Sapphire Trifecta, but rather the Capital One Credit Card Duo.
This duo is going to be the
- 3x Points on Grocery Stores
- 3x Points on Dining
- 3x Points on Entertainment
- 2x Points on Everything Else
*Annual Cost = $95
- Everything Else: 2x Points
Points are worth = About $.0185
Annual Spend Required to Recoup Card Cost: (Spend Amount* x 2 [Used Venture for simplicity sake] ) *.0185 = $95
As long as I spend at least $2,567.56, I am able to recoup the fee of the Venture. To be honest, I spend more than that on groceries in a year. You can go ahead and use this formula for the rest of the cards below. It just gets confusing to repeat it.
(Projected Spend Amount Per Category x Bonus for that Category * $ Amount that each point is worth) = Amount of Money You Made – Annual Fee
Chase Trifecta Review
It’s hard for me to recommend the Chase Trifecta, as it clearly lacks in my second-largest spend, groceries.
However, for those that like eating out, spending a bunch of money on hotels, and are willing to derive their value from the shopping portals (which are not that bad, actually), the Chase Trifecta might be a good choice.
The Chase Trifecta (for most people) is going to be made up out of
- Chase Sapphire Preferred/Reserve
- Chase Freedom Unlimited
- Chase Freedom Flex
Chase Sapphire Preferred
- 3x Points on Dining
- 3x Points on Online Groceries
- 2x Points on Travel (Personally, my subway benefits are included on this. Although $2 does not add up, it’s nice that this category is very broad.)
- 5x Points on travel booked through the Chase Travel Portal
- 1x Points on everything else
- 1.5% (Transferable as 1.5 x to Chase Sapphire Points) on every purchase.
Chase Freedom Flex
- 5% Back on a Rotating Category (Transferable as 5x points to Chase Sapphire Points)
- 1% Cash Back on Everything Else
*Please be careful, as both the Freedom Flex and Freedom Unlimited have 3% Foreign Transaction Fees.
Citi Premier Trifecta
I am not going to lie, I am increasingly becoming tempted to start building up Citi Points. Their trifecta is one of the most powerful, but the only issue is their lack of domestic transfer partners. At the time of this, their only U.S. domestic partner is JetBlue. However, if I start getting to the point of planning my one-year around the world adventure, I think it would be beneficial to invest in this ecosystem for about a year or so.
So, here is the Citi Trifecta
Citi Premier Card
- 3x Points on Restaurants
- 3x Points on Supermarkets
- 3x Points at Gas Stations
- 3x Points on Air Travel and Hotels
Citi Custom Cash
- 5x Points on Top Eligible Spend Category, up to the first $500
Eligible Spend Categories include restaurants, gas stations, grocery stores, select travel, select transit, select streaming services, drugstores, home improvement stores, fitness clubs, and live entertainment.
Citi Double Cash
- 2x Points on Everything
American Express Cards
For most people, I actually do not recommend American Express Credit Cards.
I believe that the annual fees are too high. (Outside of the Amex Gold.)
Unless you are a frequent traveler and meet very specific criteria (use this gym, etc) the bonuses are not worth the return you get on other cards AND the lack of a fee.
Whenever you pick a bank as a digital nomad, don’t worry about the interest rates on savings accounts, but rather focus on the features that the bank can offer you.
I recently decided this for myself, and I appreciate the online flexibility and a large, international presence.
Whenever you pick a bank, don’t worry about interest rates. Sure, 1.5% for a savings account looks nice, but this won’t be able to fund anything. The most important feature when choosing a bank is bank size. I recently went through this process myself, and I like large, multi-national banks.
That’s about all I have, so please feel to reach out to me with any questions!