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Money Conversion When You're on the Road
Don't Get Caught Short!

"This page has taken the mystery out of
converting cash when I travel - it sounds so easy!"

Money conversion isn't as hard as it looks, so don't let it prevent you from carrying cash when you travel.

Cash is still the simplest (though definitely not the safest) way of carrying your money on the road, and no matter what, you'll need some.

You can use cash anywhere, for the tiniest of transactions, and no one will ever turn it down - unless of course it looks like a counterfeit bill, or if your transaction requires a credit card, like a car rental deposit.

You should carry two kinds of cash:

  1. Local currency: small bills and coins, enough to see you through a day or so at your destination, or at least to take plublic transportation into town. Order this from a bank before leaving if you can.
  2. US dollars or Euros: larger bills for exchanging (if you must - but I wouldn't recommend it), and smaller bills for everyday use (this I would definitely recommend!). In many countries, having foreign currency is almost better than local currency - ones and fives for dollars, fives for Euros.

If I'd followed my own advice I might have fared better stranded by a snowstorm in Frankfurt Airport one night. My one credit card was demagnetized - and I had no cash. The airline, Lufthansa, had given us a princely $10 voucher - for McDonald's! McDonald's was closed, my pockets were empty - and I spent the night walking up and down the hallways trying not to fall asleep and miss my 6 a.m. flight... Next time, I'll remember my own rules and make sure I have a bit of cash in my pockets.

Easy steps to money conversion

If you're not used to traveling in countries with different currencies from your own, money conversion may seem a bit overwhelming at first.

It shouldn't be. Here are a few tips that might make it easier to understand.

Money Conversion Tips

  • Currency is a country's money. If you're from the US, it's the US dollar. If you're from the UK, it's the UK pound, and the Euro across Europe.
  • Currency or money conversion is the exchange from one currency into another - say from dollars or Euros into pounds sterling, pula or pesos, or vice versa.
  • One unit of your country's currency may be worth several units of another country's currency. For example, one dollar at the time of writing was worth 1.2 Swiss Francs, 33 Thai Baht, 40 Indian Rupees, or 115 Japanese Yen. Try to figure out how much of the foreign currency is equivalent to one dollar or Euro before you go.
  • To find out what something costs in another country, find out the rate of exchange - these are usually posted in banks or foreign exchange offices. They tell you how much a dollar or euro is worth in their own currency.
  • There's even an easier way: online currency converters, like the XE Currency Converter online has most foreign currencies. Just type in the two currencies and the amount you are converting, and click.

Estimating Costs in Foreign Currencies

  • Before you leave home, make a list of five basic staples and their cost at home - things like a loaf of bread, a bottle of Johnsons baby shampoo, a tube of Crest toothpaste, a box of tampons, a liter of gasoline - you choose. As you travel, check these basic prices. They'll give you an indication of how cheap or expensive other things are.
  • Convert one or ten dollars (or Euros) into a foreign currency. Just remember that one conversion - and use it to calculate the others.

Currency or money conversion is simple - just make a single conversion, and use that as your guide.

Safety measures for your cash

If you plan to carry cash, you'd better take a few simple precautions before you go:

  • Learn the basic appearance of the country's bills, especially the colors for each denomination. Unlike the United States, most countries use different colors for different bills.
  • Don't carry more than you can afford to lose - period.
  • Take less with you - and arrange for a money transfer overseas if you run out.
  • Don't be a target. Don't let anyone know how much you're carrying.
  • Keep your cash stash hidden in a travel money belt or leg or neck wallet.
  • Carry enough cash for your immediate use - make sure the rest is in credit cards or travelers checks.
  • Make sure your US dollars or Euros are brand new. I've had bills refused abroad because they were more than a few years old.
  • Don't exchange your money without shopping around. Money conversion rates vary, as do commissions. In cities, you'll often find change offices grouped closely together. That means competition - and possibly better rates. Stay away from change offices located in large hotels - they tend to cost more.
  • Group your transactions - each transaction costs.
  • Calculate approximately how much you expect to receive, then check against what you get. If it varies wildly, there's something wrong.
  • Always count your money carefully before you leave the change office - even if someone is waiting in line behind you. While most traders may be honest, it is easy to slip a 1 instead of a 100 into your stack of cash.
  • Accept only entire bills. Those with missing corners should be returned.
  • Make sure you spend all your foreign currency in the country before you leave. You might not be able to exchange it again, and even if you do (you can often exchange bills, never coins), you'll probably lose money on it.
  • Save your receipts until you leave the country. Some require them.

Money conversion on the black market

In many countries you'll be assaulted by moneysellers the moment you arrive.

They're pushing money conversion at lower rates, faster, speedier, more economical - don't be fooled.

In most countries, the black market is illegal. You may get a better rate, but it's not worth being thrown out of the country or worse, into jail for a few cents or dollars.

The black market is not illegal everywhere. In some countries in South America, black market rates are far better than bank rates and quasi-legal. In other countries, especially countries in conflict, the black market may be the only way to exchange money. In yet other countries, like Myanmar or Uganda (at the border), the black market is a perfectly acceptable transaction.

Before deciding, check your guidebook or the latest posts on travel forums for information. The last thing you want is to end up in jail just to save a few cents.