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Iceland trip preparation provides education on travel, money

Jeremy Simon | August 6, 2009 | Living with credit

I haven't even left for Iceland, and I've already learned a lot from my trip.

In a little more than a week, I'll escape the brutal summer in Austin, Texas, for a week roaming a country whose very name says cool. But if I expected my getaway to also offer a break from my daily focus on personal finance, I was sadly mistaken.

That's because even before I set foot on my flight from New York City to Iceland's Keflavk Airport, I've already discovered a thing or two I didn't consider about travel and money. Here's what I have learned so far:

Pick a credit card with no foreign transaction fees. Ahead of my trip, I applied for the Schwab Bank Invest First Visa Credit Card, which -- among its many perks -- doesn't charge foreign transaction fees for purchases made abroad. Only, I didn't leave a lot of time for the card to reach me. Here's hoping the 7 to 10 business day mailing time on that Schwab card means it arrives in time for my trip.
Don't bet on easy currency conversion. Since I'm sure there will likely be times early in my Iceland adventure (bus trip into town from the airport, cab ride to the hostel, etc.) when plastic won't be a payment option, I wanted to get some Icelandic krona before I leave the United States. Although I had assumed a currency conversion before I left would be an easy process, a lunchtime visit to the local Chase bank branch showed that isn't the case: The bank's employees were somewhat clueless about the process of converting my dollars to Icelandic currency, saying the country's currency was one they can't get. They instead encouraged me to try the local American Express office.
American Express is (temporarily) not an option. That recommendation by the Chase employees would have worked out -- if I wasn't leaving until September. According to a local AmEx travel services representative, American Express's conversion to a bank means a temporary inability for them to exchange funds. The service rep said I could probably get money at the airports in New York or Iceland if I need some cash early in my trip.
You may get hit with fees before you leave. In my case, those foreign transaction fees stemmed from switching my flight on Icelandair to a later departure time. I had foolishly assumed booking that leg of the trip would be the easy part, unaware that JetBlue had ended their early morning direct service from Austin to JFK Airport in New York. After paying the difference in airfare and the change fee with my credit card, I discovered my card statement also included a foreign transaction fee. That's because Icelandair had billed that portion of my payment through an overseas location. (The initial cost of the tickets didn't include any foreign transaction fees.) Not that I feel much better, but I'm apparently not the only traveler finding some difficulty with Icelandair and plastic.
Fee reversal is easy (in theory). My card issuer recommended getting the airline to refund the foreign transaction fee before I paid my card bills. Although Icelandair said it could give me a refund, their sales agent said it would be a few weeks before that happened. I couldn't wait on paying my credit card bill, which was due shortly, so I again talked to my credit card issuer which said it would remove the charge. Still, I'll need to supply them with supporting documentation that outlines the charge that led to that fee.
ATMs abroad will charge fees. Although some U.S. banks apparently have associated banks abroad, the local Chase bankers also said that they don't know of any ATM networks abroad that will help me take out money but avoid fees. That sounds like another good reason to use a credit card in Iceland whenever possible.

It's guaranteed that other things will go wrong on the trip, and I'll come back wiser than before I left. Still, in an effort to not make too many mistakes, what other advice on money and travel do you have to share?

See related: Even card purchases at home trigger 'international' fee, Using payment cards when traveling abroad, Credit card postcards from Europe: Volume I, Roundup: Emily's credit card travel preparations, Roundup: Emily is back from Europe

4 Comment(s)

Jane Sanderson said:

TIP: Buy a Norden Voyager card before you visit Iceland !

www.reykjavikcity.com / www.nordenvoyager.com

August 6, 2009 7:29 PM

Hafsteinn said:

In Iceland you don't have to worry to much about cash. Over here plastic is the norm and you can use it almost everywhere.

I would try to find what exchange rate your card company uses for Iceland. If you go to an Icelandic bank you will get 123,12 Kr for each $ . However it might be possible that your card has a better deal with the current economic situation and foreign exchange restrictions.

August 7, 2009 6:07 AM

Don Richmond said:

You do not need, or want to have, Icelandic kroner before you arrive in Iceland. There is a bank in the airport, open for all arriving/departing flights, and ATMs all over.

You can use plastic for everything in Iceland; the flybus from the airport, cabs, even a hot dod at a mini-mart.

Remember that Icelandic currency is not exchangeable outside of Iceland, so be sure to change it back before you leave Iceland.

August 7, 2009 9:35 AM

Jeremy Simon

said:

@Jane -- Thanks for the tip. Think I read in Iceland travel guides about a local savings card that offers discounts for museums, public pools, etc.

@Hafsteinn, @Don -- I appreciate all the info. Sounds like I'll be able to use plastic for nearly everything, so getting more than a little cash (if that) won't be necessary.

August 10, 2009 11:00 AM

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