Foreign Currency – How To Manage Strange Colored Money

All About Foreign Currency

There’s no doubt that dealing with foreign currency is one of the more confusing and intimidating aspects of travel.

We really shouldn’t complain . . . in today’s world, we have it easy. 

The Euro Makes European Traveling Much Easier

Can you imagine traveling through Europe before 1999 when every individual European country had its own currency?

As you moved from Ireland to England to France to Germany to Italy to Greece to Spain you’d cross the border, stop at a foreign exchange office, and swap out one currency for another.

Back then there were no cell phones to quickly check the official conversion rate. Aside from some posted prices outside the money exchange office, you were at the mercy of the vendor you popped into.

Hopefully you were a math wizard. Otherwise all you could do was trust that your currency exchange was to your benefit and not your detriment.

You also needed a bit of skill or luck to determine which countries to visit and in which order to make the most out of the many currency conversions.

Travelers’ Cheques . . . A Part of Our Recent Past

Before the year 2000 travelers’ cheques were king.

I’m not even sure where you’d get a travelers’ cheque today.

Today Your Phone is Your Foreign Currency BFF

Technology has made traveling much easier. The cellphone in your pocket makes foreign currency issues much simpler to calculate.

I used to get foreign currency from my bank before I left on a trip. I no longer do this. My bank charges far fewer fees when I withdraw cash directly from an ATM at the airport when I land. 

Foreign Currency Helpful Tip

Don’t use those cute and convenient foreign currency exchange booths you see in the airport. They charge a hefty commission. You’re better off at an ATM. 

Be Informed and Prepared

Be an informed traveler.

It’s really irresponsible for anyone to land in a foreign country without knowing the local currency and its conversion rate against the US dollar.

When I walk off an airplane and step outside of security I know exactly how much money my friends and I need. I confidently approach the nearest ATM and make a withdrawal. Once I have the money I tuck it into my wallet and drop it under my shirt.

Once we’re in a safe location I’ll divvy up the cash. I do this in full view of my traveling pals so everyone knows everything’s on the up-and-up.

What If I Feel Safer Paying With My Credit Card?

It’s fine to pay for most purchases with credit cards, but having some cash is helpful.

Carrying local currency gives you the peace of mind that you have money for taxis, bus fare, tips and small snacks or drinks. 

For the anti-cashers, not every small business in the world appreciates our very American way of charging everything. It’s a good idea to have local currency on hand for smaller purchases like trinkets, gelato, coffee, food vendors, soda, postcards, etc.

There are some businesses, especially across Europe, who won’t let you charge purchases less than three euros.

Deciding How Much Foreign Currency You Need

Make sure you have a ballpark figure of how much cash you want to take out before you approach the scary, foreign ATM.

Nothing says, “Hi, I’m a gullible foreign traveler, rob me,” like someone staring blankly at a cash machine. 

If you’ve done proper research, you should have a pretty good idea of how much cash you’ll need. Your phone makes the currency conversion easy.

If you need $300 USD in Euros, open a web browser on your phone and type in 300 USD in Euros. You’ll have your answer before you finish typing Euros.

There are fancy apps that will do the conversion for you, but using a Google web browser is quicker and easier, although it doesn’t hurt to have an app downloaded in case you’re out of cell range.

Just for fun and practice, open a web browser right now and type in 250 USD to Cambodian Riel.

Look at you, you’re a Riel millionaire!

Getting Foreign Currency

When you arrive at the airport and exit security, head confidently to the bank of ATMs, pick your machine and bravely withdraw the local currency.

I usually try to find an HSBC ATM as I’m most familiar with its screen format. In the grand scheme of things I’m not sure it matters which ATM you use.

I hate paying fees as much as the next person, but in today’s digital world I’m not going to nit-pick over a $2 vs $5 ATM fee. ATM and foreign transaction fees are a part of the cost of traveling and I’m not sure the extra $3 is worth the worry, especially if you’re splitting the fees with others. 

STOP and LOOK for the ENGLISH Button

Most ATMs I’ve used around the world have an English button or a Great Britain flag.

I still keep my phone out and handy, ready to translate any unfamiliar words.

When traveling with others I always volunteer to get cash out for my entire group and then we split the foreign transaction fees.

On average my bank charges me about $10 to use an ATM in a foreign country, which includes any foreign conversion fees. I don’t mind volunteering to pay these fees and then splitting it up within the group.

The Shocking Truth About USD

When traveling I always carry a couple hundred US dollars in smaller bills for emergencies.

At home in the United States, no vendor would, for any reason, accept any foreign currency for any purchases . . . I dare you to try and pay for gas with pesos. Ha!

However, you’d be shocked where you can use US dollars and Euros across the world. (The Euro is the main currency used throughout the European Union.)

I’ve had hotels in both Egypt and Peru demand we pay our final bill in US dollars, and anywhere a cruise ship docks I’ve seen vendors accept both dollars and euros. Most tourist spots in Mexico accept US dollars and I was at an underground market in China that preferred our green cash. 

Still, Pay With Local Currency

That being said, I don’t recommend you run around the world trying to pay for things with US dollars. You’d be at the mercy of the vendor who would for sure give you a terrible conversion rate and then give your change back in who-knows-what currency.

However, if you find yourself in a cash bind, US dollars are magic across the world. As long as oil is priced in USD, your cash is gold. 

As you travel, quietly observe cash transactions. You’ll be surprised at what you see. 

Credit Cards

Visa and Mastercard are the most useful cards outside of the United States. Most purchases over $10 USD I put on my credit card.

I have a MasterCard that charges no foreign exchange fees that I’ve used all over the world with no trouble or drama.

I also carry a Visa, an American Express, and a Discover Card, although I’ll rarely use any of these cards outside the United States. 

Pay in the Local Currency

When using a credit card, it’s always better to pay in the local currency.

When you swipe your credit card in a foreign country the machine will ask if you want to pay in US dollars or the local currency. Always choose the local currency and let your bank give you its current exchange rate.

Fraud

I know credit/debit card fraud happens, but I’ve never had it happen to me outside of the United States.

I’ve also never been overcharged or incorrectly charged while traveling internationally.

That being said, trust your gut. If you get a bad feeling about a vendor but you still want to buy whatever they’re selling, pay with cash and walk away.

Prepaid Debit Cards

Prepaid debit cards are perfect for international travel. You can keep a smaller amount of money on the prepaid debit card and if it’s lost or stolen it’s not the end of the world . . . or the end of your trip. Plus they’re easy to top off as funds run low. 

Kidnapping for Cash

I’ve never been a victim of any crime while traveling, but I do know there are a handful of places in the world where “kidnapping for cash” occurs.

A victim is kidnapped and driven from ATM to ATM and forced to withdraw all of their money from their bank. Once the ATM stops paying out, the kidnapped victim is released.

I hope this never happens to you, but it might be a good practice to carry a small amount of cash and a prepaid credit card with a minimal balance on it when traveling through areas known for petty crime.

While this situation is unlikely, a little preparation would keep your bank account from being wiped out.

Credit Card Companies

Credit card companies USED to require you to call or visit their website and provide a list of all the countries you were planning to visit before you left for your trip.

I LOVED doing this, especially if I had an exotic two-week Mediterranean or Caribbean cruise with a big list of countries. 

None of my current credit card companies require this fun country list update anymore.

Instead, my credit card companies send me a text message when I make a charge in a foreign country, asking me to contact them if I’m NOT in a foreign county.

This process isn’t as much fun. But as an added bonus, the text message usually tells me how much my most recent charge was in US dollars.

Check Your Foreign Travel Credit Card Requirements

Before you travel double check and see if your credit card company requires a list of countries you’re planning to visit.

If travel is going to be your “new thing” you might consider opening a debit card or credit card account specifically for travel, that way if something does go wrong on your trip your travel expenses are separate from your living expenses.

Foreign Currency is Fun!

Foreign currency doesn’t have to be scary or intimidating, simply do your research before you leave on your trip.

When in doubt pull your phone out and do a quick currency conversion check to make sure you aren’t overpaying for anything. You might also find out you’re getting a great deal on something and you should buy TWO!

Once you’ve worked through the learning curve, using local currency should be empowering and fun.

Plus it’s awesome to find leftover pesos, euros and loonies in your wallet.

I dare you to try to use them at the gas station, you’ll love the look the cashier gives you.

Thanks So Much for Stopping By!

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If you’re wondering what prompted me to share my travel knowledge, check out the About Me section.

I’d love to hear about your travel experiences, good and bad. We’ll all be better travelers if we learn from one another. 

The Art of Travel (TAOT) ~ Written by Kylie, a huge thanks to Alex for the awesome photos.