Managing your money in Japan can at first feel a tad overwhelming. With a little planning and awareness though, it doesn’t need to be.
Being prepared to tackle your budget and finances on a trip can make it a whole lot easier. With good money management, it might even mean a return trip to Japan is a lot closer than you think.
Sohow do you best prepare yourself, your wallet and your budget for a trip to theland of the rising sun? Read on to find out how best to keep your yen in check,and some insights around how much we spent on our recent trip to Japan.
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Howmuch do I need to spend on a trip to Japan?
This age old question is going to be determined by so many factors. None moreso than your own budget. Some folks are happy staying in capsule hotels. For others, nothing less than the Park Hyatt will suffice. No matter your budget, Japan has you covered.
Noting all of this, on our most recent trip we kept a detailed expense diary. Nerdy much? Of course, but we felt it the best way to share with our readers with unerring accuracy exactly how much we spent. We’ve included an infographic below with details of where our money went.
It might not be to your budget, but hopefully gives an indication of how much things cost. Finding cheap eats can be a sport in itself. Cheap eats exist in every convenience store. Those who prefer to dine in style will find many Michelin starred restaurants. And of course there is everything in between.
We’d describe our visit as a comfortable mid-budget trip. Our one night in Hakone was a splurge thanks to a rewards voucher we’d earned. This meant our visit here was actually free.
One of the key things we realised when speaking with other travellers, was the importance of keeping costs down when it comes to money management. There are some easy things you can do to keep the cost of accessing money minimal. Read on to find out how to best manage your money in Japan.
Read more of our articles about Japan
4 days in Tokyo itinerary
One day in Osaka
A day trip from Osaka to Nara
Managing your money in Japan: how should I pay for things?
Thereare a number of misnomers surrounding payment options in Japan. I see many ofthese shared on blogs and Facebook groups daily. On our very first trip toJapan in 2013, there were fewer payment options for visiting travellers.
In 2020 however, things are changing. The 2019 Rugby World Cup had MasterCard as a lead sponsor. The 2020 Tokyo Olympics sees the payment sponsorship torch handed over to Visa. There is a significant push by these companies to increase digital payments usage as a result.
Havingworked in banking for over 15 years, I can assure you, the ability to pay withcard is only increasing.
A credit card is a useful payment option
Manymerchants now accept Visa, Mastercard and American Express in stores. Lawson,7/11 and Family Mart all accept international cards. More restaurants than youexpect will accept cards. You can of course use cash in these stores, butthere’s really no need to.
Iutilise an ANZ Travel Adventures credit card when abroad. Aside from theability to earn a small amount of Velocity points, this card can also be usedto withdraw cash. Keep your account in credit (eg not below your credit limit)and you can withdraw from an ATM without incurring interest or cash advancefees.
Cardusage is only increasing around the world and Japan is no different.
Cash – you’ll still need it
Itdoesn’t matter which country we visit, we always have a small denomination oflocal currency. That said, working out how best to equip yourself with cash canbe fraught with challenges. Getting cash is one thing, but doing so whilstavoiding fees is something else altogether.
Ourtrusty ING Orange Everyday Debit card
When abroad, we utilise an ING Orange Everyday Debit card. It’s an Australian issued card that comes with no international transaction or ATM fees. That means whenever we take out cash at an ATM, we are refunded the ATM fee if there is one. And let’s face it, there always is. The exchange rate on the currency from an ATM is at the wholesale rate of the day. These rates are set by Visa, MasterCard or American Express depending on which card you are using.
Disclosure: As of February 2020, I have been employed by ING Australia.
Whetherwe need ¥5000 or ¥20000, this account is the simplest, easiest and cheapest wayof accessing our money in Japan or elsewhere.
Thereare some reasonable minimum hurdles required with this account. So best tovisit ING’s website and check the terms and conditions for yourself.
Please note: the commentary above applies to products based in Australia. These are products I use, but are not personal recommendations. For those based outside of Australia, most major markets including the UK, Canada, New Zealand the US all have similar products. Wherever you are located, I encourage you to conduct your own research on products of this nature.
Holein the wall currency exchanges
Likea good restaurant tucked around a side street, the best currency exchanges tendto be harder to find. If we’re visiting with some cash and want to exchange, weseek out the ones that tend to be a little more hidden. They aren’t payingexorbitant rents and tend to take a lower margin. In Japan, you can findexchanges that take as low as 1-4%. If the margin is higher, I’d encourage youto look elsewhere.
Avoidthe airport currency exchanges
I’llbe blunt. Airport exchanges offer the worst value. Period. Avoid using them atall costs unless completely desperate. It’s the biggest scam in travel.
Timeand time again, I see people handing over their hard earned cash to the globalforeign currency provider that resides in a lot of airports. These guys maytell you they don’t charge fees, which technically may be true. Their exchangerates however have this built in. I’ve seen exchange rates taking up to a 25%margin. That means you’re paying one in every $4 in a hidden commission.Yuck.
Youprobably shopped around for hotels and flights. Why would you give a currencyexchange a quarter of your hard earned spending money? In these instances, evena non-fee waiving Debit or credit card may prove better value.
If you must transfer at an airport, do the sums with a currency exchange app like xe.com. They provide a real time wholesale exchange rate so you know exactly what you’re getting yourself into. If you’re desperate to exchange, aim for a smaller amount to limit the damage.
ATMsin Japan
Youmay have read that getting cash out at an ATM can be difficult. On our firstvisit to Japan in 2013, it certainly was a little more challenging. On thattrip, 7/11 and Citibank ATMs were the most reliable options. There were a lotof ATMs that just didn’t like our international cards.
Withthe growth of digital payments and Japan’s tourism boom, ATMs acceptinginternational cards continues to grow.
Thereare ATMs that still accept only local cards. In the major cities and airports,there are plenty of ATMs accepting international cards. If you come across anATM that doesn’t accept your card, don’t despair. Move onto the next one, thenumbers continue to grow in your favour.
First time to Japan? Check out our guide to the top things to know before travelling to Japan.
Prepaidcards (Suica, Pasmo, Icoca)
Ifyou’ve done any level of reading, you’ll have heard that prepaid cards are wellutilised in Japan. These cards allow you to carry currency to be used in ahandful of stores and primarily the train and metro system.
Cardscan be purchased at the major train stations. We purchased our Icoca cards atShin Osaka station. Your first load will need to be ¥2000. ¥500 of this isrefundable when you return the card on departure (along with any unusedbalance).
Pasmoand Suica are available for purchase in Tokyo. Like the Icoca card, they can beused in different regions of Japan.
Wefound these cards to be our best bet to get around on public transport. Theonly catch being that we needed to top these up with cash. Not a big deal, but itdoes require some level of cold, hard yen on hand.
Whyelse would I need to use cash in Japan?
Wefound a number of restaurants and most entrance fees to temples would onlyaccept cash.
Thevending machines synonymous with Japan require coins to operate.
Arethere any other options to get Japanese Yen in Japan?
Yesthere is. You may encounter money exchange machines around the major cities inJapan. We also found one in Hakone.
Wenoticed many of these in metro stations. They allow you to deposit foreigncurrency (notes only) and provide Japanese Yen in return. I used it to exchangea small amount of Korean won, and the margin on this was 10%. This is reallyhandy for small amounts of currency you want to exchange. The margin is alittle too high for me to get excited about. If you’re in a bind, it likelyworks out better than exchanging at the airport.
Whatabout 7/11 and Lawson?
Conveniencestores offer up much more than drinks and snacks. Take note that at some ofthese stores, they will also exchange foreign currency as well. It’s not aservice I have used, but it’s another option.
What’sthe absolute best way to pay for things in Japan?
We like to keep our wallets thin, but cover all of our bases. We take a limited amount of cash, and try and utilise as little as possible. Wherever we can, we utilise our credit card. We don’t need to think too much about how much in cash we’ve got. We can check our spending instantly on our apps. We earn points on cards that helps us travel in comfort from time to time.
Whenwe need cash, our debit card comes to the rescue with no fees on internationalATMs or transactions.
IfI do want to stick to cash, do you have any other tips?
Maybeit’s being cash adverse for so many years, but I do find that the Japanesecoins are quite large and bulky. They take up room in my wallet and weigh downmy pocket. So think about a coin purse if your preference remains cash.
We hope this managing your money in Japan guide has helped debunk some myths about managing your money in Japan. Save those pennies for a nice ramen, another activity or maybe even a hotel upgrade!
Have you visited Japan? Have we missed any tips when it comes to managing your money here?
