Travel Travel Budgeting & Financial Planning 1

Question 1

What is the primary advantage of using a travel credit card with no foreign transaction fees?

Accepted Answer

Avoiding the 1–3% surcharge on every foreign purchase

Answer

Travel credit cards with no foreign transaction fees save travelers from the 1–3% surcharge that standard cards add to every international purchase.

Question 2

What is the '50/30/20 budgeting rule' adapted to travel?

Accepted Answer

50% pre-paid, 30% daily spending money, 20% emergency fund

Answer

A practical travel budget often allocates roughly 50% to pre-booked essentials, 30% for daily spending, and 20% as a contingency emergency fund.

Question 3

When is typically the cheapest time to book domestic US airline tickets?

Accepted Answer

6–8 weeks before departure

Answer

Research suggests domestic US flights are typically cheapest when booked approximately 6–8 weeks before departure, balancing availability and price competition.

Question 4

What does 'travel insurance trip cancellation coverage' typically reimburse?

Accepted Answer

Non-refundable pre-paid trip costs if you cancel for a covered reason

Answer

Trip cancellation insurance reimburses non-refundable pre-paid travel expenses when you must cancel for reasons specified in the policy such as illness or death.

Question 5

Dynamic currency conversion (DCC) at foreign ATMs or merchants should generally be:

Accepted Answer

Declined — it results in worse exchange rates

Answer

Dynamic currency conversion should almost always be declined as it applies a poor exchange rate set by the merchant, costing travelers more than using their card's standard rate.

Travel Practice Test

Travel Practice Test

Travel Travel Budgeting & Financial Planning 1