FIGHT BACK : TRAVELERS CHECKS STILL A VIABLE OPTION.

Byline: David Horowitz 

Are travelers checks obsolete? That's the buzz among some travel experts. Why stand in line, pay a fee and sign your name 30 or 40 times just to buy travelers checks when all you really need is a bank or ATM card? After all, plastic money is accepted just about everywhere these days, and you're never far from an ATM.

But before we simply write off a $53 billion industry, let's look at some comparisons between travelers checks and credit or ATM cards.

Acceptability: Travelers checks still have the edge here. There are now more than half-a-million ATM machines worldwide that accept either VISA or MasterCards, but they are not universally reliable. Cards are catching up, but they're not there yet.

Security: This has always been a major reason for carrying travelers checks. Lose your travelers checks, and the company will replace them, often the same day. Lose your credit or charge card, and you will probably get another one, but it may take days. In the meantime, you are responsible for up to $50 in fraudulent charges made on your card. And once you've withdrawn currency from an ATM, that's theft-vulnerable cash.

Cost: Travelers checks cost about a dollar for every $100 worth of checks if purchased over the counter. But you can get them free from auto clubs, credit unions, credit card companies and sometimes your own bank. Charging purchases on a credit card is usually free, but getting cash from an ATM will cost you a transaction fee.

Foreign exchange rates: This is where plastic has a clear advantage. Banks get the best exchange rates and pass those savings on to their cardholders. Travelers checks are exchanged at whatever rate the hotel, retailer or bank wishes to charge.

Overspending: Buying travelers checks in advance imposes a certain limitation in vacation spending - providing you stick to spending the money you have in checks. An ATM or debit card limits you to what you have in your checking account. Charging on credit cards can run you deeply into debt - and quick.

American travelers are also beginning to carry ``smart cards'' that can be used for all kinds of purchases, even phone calls and parking meters. VISA is now introducing what it calls TravelMoney. This is a prepaid card that automatically tracks your remaining balance. It works like an ATM card and cannot be used by anyone without a special identification number. There is no surcharge for the card. At this point, it's hard to tell what these new cash alternatives will have on the American travel business.

The advice travel agents have been giving out for years still sounds good to me: Split up your money. I carry no more than $200 in cash and no more than two bank cards. Major expenses like air fares, hotel bills and expensive meals go on a card, both for convenience and to get a better exchange rate.

But I also carry spending money in travelers checks, especially if I'm traveling overseas. I probably wouldn't if I had to pay a fee for the checks, but both my auto club and credit union provide them free to their members. Travelers checks may be old-fashioned, but I still like having them with me.