This is your guide to all things traveling and money. Money can be one of the most stressful things about traveling. How will you exchange money? Will I need to tip the staff? Keep reading to find out the tips I’ve learned during my travels.
Traveling and Money – Exchange Rates
Before you even book your trip, check out which travel destinations have good exchange rates compared to where you live. Good exchange rates mean that you will get more for your money. For example, an item may show up as $5 in the local currency when you go to purchase it. Then you go home and check your credit card statement. To your surprise you were only charged $3!
Cash or Credit Cards
Research your travel destination. Many countries are cash based. Others do accept credit cards in most places. Figure this out before you get to your destination.
If your destination is cash based, decide if you will exchange money before or after you get to your destination. There is no right or wrong answer. This varies depending on where you go. I have exchanged currency at my home bank, then taken the cash with me. Other times I have withdrawn money from an ATM at the airport, or a bank located near where I was staying.
When I use my credit cards in foreign countries, I notify my bank before I travel and tell them my dates of travel. This will reduce the chance of my charges overseas being denied.This is one of the tips I mentioned in my post about things to do before you take an international trip. Check out that post here.
I do not use debit cards to pay for items when I travel. I only use them to access the ATM machines. This is a personal choice and I follow the same practice when I am home.
When I use a credit card to purchase items that I was going to purchase anyway, I get points that go towards future travel.It is also easier to file a claim and get your money back when you use a credit card. Credit cards come with security features most debit cards do not have. This is especially important when traveling to a foreign country.
Budgeting
As soon as I step onto foreign soil everything seems inexpensive. I don’t know what it is about buying things in other countries. Everything looks like a good deal.
When it comes to traveling and money, I suggest you give yourself a budget. Most people hear the word budget and cringe a little. Your budget does not have to be strict and can be tailored to your needs.
Plan for food, transportation, souvenirs, entertainment and emergency expenses.
Tipping
Research the tipping culture. Many counties to not expect you to tip. Tipping is common in the U.S. In some countries it can even be considered offensive to offer a tip. Don’t assume everyone tips.
Taxes
This goes for taxes as well. In South Korea for example the tax is included in the price. It seemed so simple really. This includes restaurants and every kind of store I can think of. The price you see is the price you pay.
Duty free shopping is a little different. Duty is another word for tax. There may be places that you may not pay tax as a tourist. When you purchase the item at the store you do pay tax. Then they will give you a special receipt. You take that receipt back to the airport and you get a refund for the taxes you paid. Sometimes you will have to spend a minimum to receive tax back.
Other shops in airports are duty free and you don’t pay tax. No special receipts are required. However, you can’t open all items you purchase at those stores immediately. Depending on the item (usually liquor) it is put in a special tamperproof bag, and you are not supposed to use the item until you have reached your final destination/home country.
If you’re interested in saving money when you travel, check out this post about motivating yourself to save for a big trip. Then check out this post about airline vacation packages.
Traveling and money go hand in hand. So, it’s great to know a few things before your trip. Do your research and don’t stress.
