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Should I Apply for Credit Cards Before I Move Overseas?

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Moving to another country is complicated and exciting — and it entails lots of questions. Where will you live? How will you make friends? What kind of electrical adapter should you buy? Keeping an eye on your credit is probably the last thing you’re worried about. However, maintaining at least one active U.S.-based credit account is key if there’s any chance you’ll move back to the States, and can solve some practical challenges you’ll encounter abroad. It’ll help you:

  • Get loans later. Your move abroad may have no end date, but that doesn’t mean it’ll last forever — and if you come back, you’ll want to be able to get loans and new credit. A U.S. credit card will keep your credit profile healthy back in the States.
  • Protect your identity. Inactive credit accounts are magnets for identity thieves. Using your U.S.-issued credit card responsibly will improve your credit score and may keep you from becoming a target.
  • Have flexibility. U.S. cards may make certain online purchases and reservations easier and are helpful if you’ll be paid at least partly in American dollars.

Keep in mind that in order to have U.S.-issued credit, you’ll probably need a U.S. bank account and a U.S. address. Some ex-pats find it easiest to open a joint account with a trusted friend or family member back at home, and use their address for bank mailings.

If you’re moving out of the country and don’t already have a U.S.-issued credit card, apply for one as soon as possible. Even if you already have credit, you may want a card that’s better suited for international travel. Look for a card with:

  • International acceptance. Not all cards are accepted outside of the United States. In addition, many countries use EMV chip technology, which is growing in popularity, but still relatively uncommon stateside. You won’t always have the option to swipe your card, so one with an EMV chip is your best bet.
  • No foreign transaction fees. Some — but not all — cards charge a small fee (usually around 3%) on foreign purchases. It may not be a lot each time you swipe, but it will add up over time, especially on your default card. Choose one that minimizes or eschews transaction fees, and has favorable rates on other services, like foreign bank withdrawals.
  • Miles and other perks. It’s more important to have a card you can use overseas than one that rewards you, but cardmember perks are a major bonus. Try to find a card with points you can redeem for airline miles to make trips home that much easier.

» MORE: 7 Ways your credit card could save you money on holiday travel

Whether you apply for a new credit card or use an old one, let your issuer know you’ll be using it abroad. That way, they won’t flag any foreign transactions as suspicious.

Once you’re settled into your new home, you may want a local credit card as well. But don’t dump all your U.S. cards. Keeping part of your credit life stateside will have major benefits both now and in the future.


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