Should I Buy Travelers Checks

[Travel Guru]

People on vacation often buy travelers checks/ travelers cheques, and for good reason. Travelers checks are a very safe means of carrying cash on your journey, and they offer the ability to recover any stolen funds.

If you lose your travelers cheques while on vacation, here is what American Express recommends you doing: Call an American Express Travelers Cheque Customer Service Center as soon as possible and have the serial numbers of the Cheques in question on hand. Refunds must first be pre-authorized by an American Express Travelers Cheques Service Center. As another option, you may download a Refund Claim Form, complete it and fax it to 1.800.417.0060.
Note: Your refund, once approved, will be sent in the form of a company check to your home. Please allow 7-10 business days for the check to arrive.

Traveler's cheques are available in several currencies such as U.S. dollars, Canadian dollars, pounds sterling, Japanese yen, and euro; denominations usually being 20, 50, or 100 of whatever currency, and are usually sold in pads of five or ten checks, e.g., 5 x €20 for €100. The purchaser of a supply of travelers cheques effectively gives an interest-free loan to the issuer, which is why it is common for banks to sell them "commission free" to their customers. The commission, where it is charged, is usually 1% of the total face value sold. Traveler's checks do not expire so unused cheques can be kept by the purchaser to spend at any time in the future.

Upon obtaining custody of a purchased supply of traveler's cheques, the purchaser should immediately write his or her signature once upon each cheque, usually on the cheque's upper portion. The purchaser will also have received a receipt and some other documentation that should be kept in a safe place other than where he or she carries the cheques.

When wanting to cash a travelers check while making a purchase, the purchaser should, in the presence of the payee, date and countersign the cheque in the indicated space, usually on the cheque's lower portion (if at a restaurant, it may be helpful to ask the waiter to watch and wait for this to be done). Applicable change for a purchase transaction should be given in local currency as if the cheques were banknotes.

Not long ago, a reader asked: "Is anybody still using traveler's checks?" Good question. Today's conventional wisdom is that ATMs have made it unnecessary to carry large amounts of cash or cash substitutes. Automated Teller Machines also give a better conversion rate than banks and exchange counters do (or so the argument goes). And with an ATM card, you don't have to pay a fee of 1% or more for the safety of not carrying cash.

Travelers checks allow you to travel overseas and carry as much money as you need to cover expenses on your trip. You’ll have peace of mind knowing that should they go missing or get stolen, you can receive replacement checks, so you won’t lose any money, or any time enjoying your trip.