Decades ago traveler’s checks were the “king of the road”, but now are obsolete. \u00a0With the revolution of software and personal computing, financial transactions at home and abroad have moved largely to an electronic format.\u00a0 Today most people travel with just an ATM (debit) card and a credit card \u2013 perhaps with a spare credit card just in case your main card is lost or stolen or doesn’t work properly.\u00a0 In Europe and most other countries this makes a lot of sense where the currency and exchange rates are stable, and there are many places you can use your cards.\u00a0 The fees for ATM withdrawals can be significant, as both the foreign bank and usually your domestic bank will charge you for the transaction. \u00a0Some credit cards, like Capitol One, a few Chase cards and soon American Express don’t charge foreign transaction fees so use one of these if you travel a lot.<\/p>\n
But there are times, even in today’s computer age, \u00a0when cash is king.\u00a0 As a matter of habit (and a sense of personal security), I usually travel with some cash in a money belt when abroad just in case of emergencies.\u00a0 Rarely do I use this cash reserve but there are times when it can be very handy to have cash, as I just found out on my latest trip to South America.<\/p>\n
I recently visited Argentina, a country known for political and hence currency instability.\u00a0 At the time of my trip, the Argentine government had set the official conversion rate between the Argentine Peso and US$ at about 8:1.\u00a0 The official rate of inflation was said to be about 8% but people in Argentina know better.\u00a0 They know their peso is worth significantly less than the official exchange rate and that their real rate of inflation is somewhere around 40%. \u00a0As an example, restaurants print menus without prices on them; prices are penciled in and updated as often as on a weekly basis to reflect the higher costs of doing business.<\/p>\n
There is a hunger for hard stable foreign currency in Argentina and it’s very easy to get a better exchange rate from business people and folks on the street than you can from banks. \u00a0\u00a0The highest exchange rates will be given to you by shady characters in back alleys \u2013 beware of these individuals because there is a significant chance they will cheat or rob you.<\/p>\n
Besides the ease of spending cash, there are some real advantages to it in Argentina.\u00a0 ATM fees were high \u2013 around $US 7 from the Argentine bank for a withdrawal plus several buck fee from my American bank.\u00a0 Limits on withdrawals are small, usually 1000 Argentinian pesos a day (around 125 $US at the official rate), so you easily could spend 6-7% of the value your withdrawal just on bank fees.\u00a0 And often Argentine ATMs run out of cash, especially in small towns, so good luck finding one that works, whose directions you can understand (most did not have English as an option), and which has cash to dispense. \u00a0The disappearing “eaten” ATM card was something we witnessed firsthand this trip, fortunately not involving us, but people’s ATM cards were not returned from the machine at the conclusion of the transaction. \u00a0Many smaller businesses and restaurants in Argentina do not accept credit cards, limiting their usefulness.<\/p>\n
So educate yourself about the place you\u2019re traveling to and consider bringing along more cash than you otherwise might if it makes sense to do so.\u00a0 If you can get 25% or more local currency by using cash rather than a credit card or ATM card, you’ve greatly reduced the cost of your trip.<\/p>\n
Some important words of caution:<\/p>\n
1)\u00a0\u00a0\u00a0\u00a0\u00a0 Be very careful exchanging money with guys on the street.\u00a0 There’s a lot of counterfeit currency in most countries and you likely wouldn’t know if you are exchanging your US dollars for counterfeit currency until you’ve been in the country for some time and familiarized yourself with that country’s money. \u00a0Plus guys in the alley have friends will gladly relieve you of your cash and possessions.<\/p>\n
2)\u00a0\u00a0\u00a0\u00a0\u00a0 Best to be safe and see if your hotel or restaurant will accept US currency.\u00a0 We were generally able to exchange our US$ for about 10 \u2013 11:1 at these places, a 25-35% higher return rate than the official currency exchange, and we used cash to pay for services provided.\u00a0 For example, a restaurant tab of 400 Argentinian pesos could be paid with $US 40 cash.\u00a0 In these types of transactions we got no change back and didn’t have to worry about getting any counterfeit Argentine currency.<\/p>\n
3)\u00a0\u00a0\u00a0\u00a0\u00a0 Never carry a lot of cash in your wallet or purse.\u00a0 ALWAYS carry your cash under your clothes in a money belt or a \u201cleg wallet\u201d, like\u00a0these<\/a><\/strong>\u00a0or\u00a0these<\/strong><\/a>.<\/p>\n 4)\u00a0\u00a0\u00a0\u00a0\u00a0 Take mostly $20 dollar bills (not $50s or $100s) with you and make sure the bills you take are pristine (new looking).\u00a0 Folks overseas don\u2019t want torn, worn, or marked up currency.\u00a0 They like clean, fresh Yankee bills, Euros or British pounds.<\/p>\n 5)\u00a0\u00a0\u00a0\u00a0\u00a0 Don\u2019t exchange more money than you\u2019ll use.\u00a0 It can\u2019t converted back to $US when you leave and it\u2019s likely to be worthless if you were ever to return to Argentina.<\/p>\n Of course if you\u2019re not comfortable traveling with cash, I can understand that and if it makes you worry, don’t spoil your trip by using cash. \u00a0Use the ATM and credit cards you’re used to understanding there’s a cost in doing so.\u00a0 Everyone needs to work within their comfort\/tolerance levels. \u00a0But if you\u2019re on a tight budget, the cash option in some countries is a way to make your hard earned cash stretch farther.<\/p>\n","protected":false},"excerpt":{"rendered":" Decades ago traveler’s checks were the “king of the road”, but now are obsolete. \u00a0With the revolution of software and personal computing, financial transactions at home and abroad have moved largely to an electronic format.\u00a0 Today most people travel with … Continue reading