Charles Schwab ATM Card?
Charles Schwab has a high yield banking account that you can use basically as a checking account. They don't charge ATM fees and reimburse the fees that other ATMs charge and when I contacted them they said they don't charge a currency conversion fee either. I don't know what their exchange rate is though. Has anyone had any experience using a Charles Schwab ATM card abroad? What was the good, bad, neutral?
Simone
U-District, WA 5/25/08
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This was a topic a couple of weeks ago. Try searching on Charles Schwab in the search box on the upper right of this page and you should get those posts.
Thanks Nancy, I had tried that search last week and came up with no results, but they showed up this time. Good discussion on all things ATM related.
Simone - you may have already found my posting on another thread but I'll put it here as well.
I opened a Schwab high yield account last fall for both myself and my daughter who is studying in France for the year. We visited her this past March and had a chance to use our Schwab card. There were no ATM fees and no currency conversion fee. As far as I could tell - based on xe.com historical figures for the dates I was there - the exchange rate they quoted me was pretty well the rate quoted on xe.com. I am very happy with the Schwab card both here and abroad. They have also reimbursed all ATM fees that other (US) banks have charged me for withdrawing from their ATMs. There were no ATM fees charged by the European banks we used.
Just to satisfy my curiosity, I called Schwab. I have a brokerage account with them (which you need in order to get the High Yield Checking Account). They reimburse you for all ATM fees charged by banks in Europe. However, they do not reimburse you for conversion fees charged by vendors. I'll still use my Capital One for purchases, hotel charges, etc. But I think I'll open the Scwab account to get $$$ from ATMs there. Thanks everyone.
"However, they do not reimburse you for conversion fees charged by vendors."
Vendors do not charge you conversion fees - your bank charges a fee to convert the amount that the vendors charge you - i.e. 10 Euros - into the dollar amount that is withdrawn from your US account. This conversion fee is also referred to as a foreign transaction fee and is sometimes listed as a separate charge on your statement. The going rate seems to be anywhere from 1-3%. Some banks will charge you this fee to withdraw money from an ATM as well as their ATM withdrawl flat fee.
For example: last summer I withdrew 250 Euros from an Italian Bank using my Bank of America card. BofA charged me $332 which was the exchange rate for Euros on that day (1.33). They then charged me $3.33 as a foreign conversion fee. They also charged me $5.00 as an ATM withdrawl fee.
This is different from any discussion of Dynamic Conversion which is where the vendor offers to charge you in your own currency - i.e. USD - apparantly at a very high rate.
In order to have this checking account do you have to USE the brokerage account?
No, you don't even have to fund the brokerage account. Normally, you have to have at least $1000 in the brokerage account, but if you open the (required) brokerage account with the checking account that minimum is waived, and there is no minimum on the checking account, either.