There will be no money in the ideal world. Everywhere we pay with plastic cards, either by phone or smartwatch. And one currency will apply – the one in which we get a salary. But now every travel begins with the question: what about the money?
There are several possibilities. We can:
– buy in our homeland the currency of the country to which we are travelling
– buy dollars/euros and exchange them on site
– bring your card with you and take cash out of the ATM on the spot
– take a card with you and pay for everything with ‘plastic’
Each of these options has its advantages and disadvantages. Until something better was invented, we have to rely on this list. It is important that we are aware of the pros and cons of particular solutions.
We buy the currency at home
We came to Dubai on the evening flight of Wizzair to the DWC airport, far away from the city centre. The only bus was running every hour. We had to run. Tickets can only be purchased for cash. Buying currency at the airport – every globetrotter will tell you that – it’s one of the most stupid ideas. The spread, or “gap” between the buy and sell rate, is as open as the mouth of a hippopotamus. Finding an ATM is a nice entertainment if you have time. And we did not have any. That’s why we bought dirhams before we flew to Dubai. Of course, we paid the spread, but we had time to look for the best rate and check prices at several exchange offices.
The obvious downside of buying a currency in our country and transporting it abroad is the risk of losing your wallet. Travelling the world we must have several currencies with us. And the best thing is to have a magic mirror so that we know how much money we will need in different countries. Of necessity, therefore, we must take more money, which does not have a positive effect on the state of our account. And in consequence, after returning, we have a handful of strange currencies with which we do not really know what to do. Usually, it’s not enough to cash it again the exchange office (and if it’s coins, then they may not accept them). A few years of such travels and we have a pouch of money from strange places, but it does not please us at all.
We buy dollars / euros and exchange them on the spot
This is probably the most popular solution if we travel a lot. Africa, Asia or America – no one despises European or American money. And we, having in perspective travel through ten countries, do not have to wonder how much we will need Thai baht, where to buy Omani rial, Gambian dalasi or Chilean pesos. And the unused dollars during the trip can always be useful during the next trip, even if we travel completely elsewhere.
Good news is over. And now it’s time for worse.
When it comes to wallet loss, it can be just as painful as travelling with any other currency. There is also a problem with the exchange of money. We must devote some time to it. You will need to find a currency exchange with a good rate. And that means that all the places that are close to tourists are dropped: the airport, hotel, taxi drivers. Maybe you will have to go around the city and look for a currency exchange office. Or ask the locals. Compare the odds in several places. And then do not be fooled. Count banknotes with foreign-sounding names and – sometimes – printed in different alphabets. The spread will not be omitted. And it’s double, because once we pay for buying dollars, then we will sell these dollars (with our loss) and buy (at a higher price) the national currency.
We take money from an ATM
At first glance, this solution has one major advantage, compared to the previous two: we do not carry a stuffed wallet. The possible thief will fail because the card can be blocked in a minute. ATMs are also almost everywhere in the world (although in Luxembourg – the capital of the global financiers – we searched for them for an hour). But usually, the matter is simple. In every bank outlet, mall or on the main street, we will recognize the characteristic shape of ATM, or what it will be called. We insert the card, we enter a four-digit PIN. We give the amount that pleases us. And the machine spits out the banknotes.
Now let’s look at the vices.
A standing ATM on an unlit street in a foreign country is probably the last place in the world where I would like to flash my money. Scam cards, peeking at PINs or simply swallowing cards is too often the practice of ATMs in places besieged by foreign travellers. But even if everything is OK, withdrawing money from an ATM almost never is for free. We will pay a commission for payment (unless we are lucky enough to have a bank account that does not cut out on withdrawals from foreign ATMs). Regardless of the bank, the ATM operator will draw a commission from us. For example, in Thailand, it is several pounds each time you take money. In tourist resorts, or at shops, monuments, at gas stations – it is common practice. In addition, we will pay the spread, as in any exchange office. Because although the whole operation will last a few seconds, it looks simply the same as in the case of buying currency in any other place. We transfer money from our account to the local currency at the buy rate.
We pay with the card
Or maybe it’s best to simply pay for purchases by card?
It is true. This solution is the simplest, but it does not mean that it is the cheapest. There are countries, for example in West Africa, where charges for using the card are criminal, up to 30 percent of the price. But even in Europe, there are traps waiting for us. Most often in the shop the seller, seeing a foreign card, will ask us an innocent question: do you prefer to pay in pounds, or in our currency (euro / SEK / zloty/forints)? In the first glance, we want to answer: of course in pounds! It’s clear! We see how much we will spend on the account, and no penny more. But nobody tells us that the commission for such a facility is hidden in the price. Do an experiment: paying abroad, write down the price of the merchandise offered to you in GBP, but pay in the currency of the country where you are. And then look how much you lost from your account. I have checked it many times and ALWAYS paying in the local currency was a better idea.
There is also something like “conversion currency” for a specific card operator. VISA uses USD, and Master Card – Euro. It does not matter if we’re on holiday in Thailand. By paying with the VISA card, the bank will first collect the pounds, buy dollars for it, and exchange the dollars for bahts. In the case of Master Card it’s the same, only instead of dollars, the bank will buy the euro, and for the euro – bahts. As you can guess, we will pay the commission for these two transactions (well, who should do it?). The situation is simplified when we pay Master Card in the euro area countries and in the USA – by VISA card. Then the commission is only one.
Unless we have a British card. There are more options here. For example, I have a Lloyds Bankcard, which I try not to use abroad – I often leave it at home. Because for each transaction in a currency other than pounds, the bank charges a commission.
There are also places in the world where they have not heard about payment terminals. In such corners of the earth, cash reigns.
Interesting, although in the long run, the most practical solution is the currency cards offered by some banks. We can “recharge” them before leaving and pay abroad as if we were local. Only… Because there is always some ‘only’. In this case, the range of currencies is quite modest, such cards cost a few pounds, and besides, the foreign currency is not teleported to it from our account at no charge. Anyway, we will pay some spread, even if it is a small amount.
How do we do it?
There are no ideal solutions. We travel a lot to different countries and have learned not to upset ourselves with the constant conversion of money. But above all, we try to pay as much as possible online, preferably before departure. Hotels are booked and paid by Booking.com. We pay airline tickets or rent a car by bank transfer. We try to have some local cash with us (if a currency is not available in exchange offices, we are looking for friends who were in this country and we buy from them what they left after leaving), and we travel most often around the world with “backup” of dollars. Why not with euro or pounds? Because when in an “emergency” situation we run out of a few cents for a taxi or a souvenir at the bazaar, the locals do not play in subtlety. One dollar, one euro, or one pound is the same for them. And not for us. By the nature of things – it is better to pay extra dollars than pounds. And when travelling, as in life, the principle of diversification is useful. We never keep “all the eggs in one basket”. Separately, cards, cash, documents elsewhere. Thanks to that we avoided the tragedy several times. Although once we lost vigilance (as well as documents and cash) we could return home because the cards were saved.