Vacation season is almost upon us and, for many Americans who haven’t traveled abroad in several years, their vacations have been years in planning. However, even the best laid plans can quickly come unraveled if you don’t take some extra measures to ensure that your finances are protected before you leave on your trip. Your vacation planning checklist needs to include these essential steps of how to protect your finances while traveling on vacation:

Stick to a budget:  Everyone plans their vacations around a budget, but sticking to one is a lot more challenging. If you find yourself overseas and overspending, you could wind up having to dip into your savings back home, and that could be more costly than you think. First, just accessing your bank accounts from abroad generates fees. High ATM fees (where ATMs are available) and exchange fees can add up if you have to go to the well to often. Then, after returning home, you have to confront the reality that you’ve depleted your checking or savings more than you planned. To prevent this possibility, build a cushion on the cost side by getting the best possible travel deals and cutting back on a few luxuries (that 2.5 start motel can be just as charming as a 4 star hotel).

Know your credit card protections: When you use your credit card to cover your travel costs, you’ll have some built in protections such as fraud protection, auto rental collision coverage, trip cancellation insurance (not all cards have this so check with yours), lost luggage insurance, and purchase protection. Review your credit cards protections so you know what you’ll have when you travel. It’s always a good idea to call your credit card company to let them know where you will be traveling to make sure your protections apply.

Automate your bill pay: Make sure all of your utilities, credit card and loan accounts are set up for automatic bill pay. While it may also be possible to pay them online while you’re traveling you can’t always count on a good Internet connection.

Take a postal vacation: The surest way to attract identity thieves is to let your mailbox overflow. Most post offices offer temporary mail holds. If not, arrange for a neighbor to pick up your mail. Of course, if you have converted most of your financial accounts to online bill pay, you shouldn’t be receiving much in the way of bills, but its best to be safe and hold all mail.

Use credit cards while traveling: You should always carry some cash, but most of your purchases should be made with a credit card.  In addition to the protections, it provides you with a more accurate spending trail for budgeting. Try to use a credit card with the most favorable exchange fees (some cards waive the fees altogether). You need to be aware that, with most cards, you won’t see the exchange fees except when you receive your statement. Also, be sure to let your credit card company know where you will be traveling so they don’t freeze the card if they suspect it has been stolen.  Also, check with your card company to see how quickly they will replace a lost or stolen credit card.

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