5 Money Lessons From Clark Howard’s Trip to Europe

If you’re thinking about planning a trip abroad, how and where you pay will play a major role in determining how much you pay. 

Money expert Clark Howard recently returned from a trip to Europe with some fresh money advice for those looking to take a trip abroad.

5 Steps To Save On Your Travel to Europe

There’s no better time than now to snag some fall travel deals. But before you book, here are Clark’s tips for a European trip:

1. Take Advantage of the ‘New York Bargain’

The “New York Bargain” is when you fly abroad from the Big Apple. To save even more, compare fares out of John F. Kennedy International Airport (JFK) as well as out of nearby Newark International Airport (EWR) in New Jersey.

“It’s not unusual for airfares to Europe to be as little as one-third the cost to one-half the cost out of New York what they are most anywhere else in the United States,” Clark says.

How To Save on Flights To Europe: 

• Buy a domestic ticket to New York.  
• Purchase an international fare from New York

“That will not always save you huge money, but usually it will,” Clark says.

Want to save on airfare? Read our Google Flights guide.

2. Consider Alternative Car Rental Coverage

Renting a car abroad can be expensive. The car rental companies in Europe make their money by selling you their “pseudo-insurance trash,” as Clark calls it.

One way around this is to use the car rental coverage that comes with a premium travel card.

“You can buy a policy from some of the premium travel cards,” he says. As an example, American Express has flat-rate car rental insurance that you can add as primary or secondary coverage. “Cost ranges from $12.25-$24.95 per rental depending on coverage option selected and state of residence,” it says on the AMEX website.

How To Save: If you have a premium credit card with car rental coverage, use it.

“It’s much cheaper to buy through American Express than having to be at the rental counter and deciding you need all that insurance junk from them,” he adds.

You should note that some car rental companies will not honor the insurance coverage that comes with a credit card.

3. Watch How You Pay

Clark says that when you purchase something overseas, it’s easy to get ripped off if you pay for it the wrong way.

Whether you are using Apple Pay, G Pay, Samsung Pay, or a credit card, you will likely be given an option on the screen to pay in local currency or convert it back to your local currency.

“So, people think, ‘Oh, wow. They’re going to charge me in U.S. dollars.’ They click there. Guess what you’re paying when you click there? You’re paying typically as much as 17.5% extra for the purchase when you click U.S. dollars instead of local currency.”

How To Save on Currency Conversion Fees

“Very important: Anytime you’re buying something [while traveling abroad] using your credit card, probably two-thirds of the time, it will do that same thing where it says ‘local currency or dollars.’ Always remember, you’re paying in local currency,” Clark says.

4. Watch Out for ATM Currency Exchange Fees

When you go to an ATM in Europe, you’ll need to tap the right buttons to avoid super-high junk fees for currency conversions.

“At the ATM, it will ask whether you want your money converted into dollars or do you want it in the local currency, no matter if it’s Polish money, Czech money, Euro, British pounds, whatever. If you click U.S. dollars, suddenly again, you’re paying a transaction junk fee of up to 17.5%.”

 Can you imagine that? It says on the screen, ‘Do you want to accept paying this fee or not.’ You say, ‘No!’ And then you select the local currency and you get the banker’s buying rate on the money.”

How To Save on ATM Currency Exchange Fees

Opt to receive your money in local currency.

5. And ATM Junk Fees

If you have to use an ATM that’s not owned by your bank or credit union, Clark wants you to be prepared to pay a junk fee that may be bigger than the typical $3 charge you’ll find at some out-of-network ATMs here in the States.

“That junk fee will range over a wide span. But usually, bank ATMs don’t charge that junk fee,” he adds. “Beware at independent ATMs, there may be a giant junk fee just for withdrawing the money.”

How To Save on ATM Junk Fees

How To Save: Bank with an organization that will eat ATM fees for you. The Charles Schwab check card reimburses ATM fees abroad and here in the United States. USAA also will reimburse you up to $10 per billing cycle when you use a non-network ATM. 

Prefer to pay with a credit card? Read our guide on the best credit cards with no foreign transaction fees.

Final Thoughts

Europe is a hot destination right now as Americans try to squeeze in a trip or two before the travel season ends. Always compare when looking for fares. You might even be able to score a premium seat for less.

When traveling abroad, Clark wants you to save on transaction fees, flights and car rentals to get the best bang for your buck.

Want more travel tips? Read about Clark’s #1 Travel Rule.