It is a topic often discussed amongst people who live overseas, or travel abroad frequently: credit cards and foreign transaction fees. I’m pretty conservative when it comes to the banks with whom I am willing to have a credit card, because I have seen so many people get screwed by bad credit card companies. For years, I have had two credit cards, one with USAA and one with Navy Federal. The I was seduced by the Pentagon Federal Credit Union (PenFed) Platinum Cash Rewards card with 5% cash back on gas purchases. It was great when we were living in the DC area and spending a fortune on gas. The card has fallen into disuse since we moved overseas because we purchase our gas rations through the Navy Exchange and it doesn’t trigger the cash back feature.
And then, I learned something new and exciting. A promotional email from PenFed for their Platinum Rewards credit card advertised 5 points per dollar for gas purchases, 3 points per dollar for grocery purchases (including the commissary) and 1 point per dollar for all other purchases. It doesn’t offer a cash rebate but a Visa gift card is fine with me. Best of all, it advertised no overseas transaction fees. This got me looking, and lo, it looks like none of the PenFed credit cards have foreign transaction fees! Hey-o, time to dust off the PenFed credit card and start using that instead of my USAA or Navy Federal cards, each of which charge a small 1% foreign transaction fee.
In addition to having no foreign transaction fees, that 3% cash back in grocery purchases will really add up. My family’s food budget exceeds $1000 per month, so that would mean at least $30 a month in rewards on groceries alone. The $360 in gift cards that I can earn in a year is nearly my entire Christmas budget.