You have several options when it comes to money during your trip. Every destination wants you to spend your money there, but they all have different norms and infrastructure for accessing and using it. Be sure to research your specific destination, but here are a few reminders and guidelines.
Here are a few general rules and options around exchanging and using cash in foreign countries:
- Monitor exchange rates (try www.xe.com). The rates you see on such currency conversion sites are the mid-range rate between buy and sell rates. But you’ll pay the buy rate for currency, which is often 3-7 % higher than the rates posted on those sites. (Note that exchange rates on our site reflect the buy rate, which gives a more accurate figure for what you’ll actually pay for your tour.)
- You can order foreign currency through your bank at home in advance of your trip. You’ll get the exchange rate of the day the bank buys that currency for you, rather than the rate at the exact time of your trip. (This can be a good thing or a bad thing, depending on which way the exchange rate fluctuates.)
- Exchanging money at kiosks in major tourist centers (and especially at airports) will usually give you a terrible exchange rate.
- Cash is the easiest target for pickpockets and is the only payment form that can’t be stopped or recovered. Carry it in a money belt or under-shirt pouch.
If there's easy access to ATMs at your destination, that can be a good option to consider. You’ll usually pay a usage fee (much like using an ATM from another bank within the U.S.), but they're typically not more than about $5. The exchange rate is typically reasonable.
Major credit cards are accepted throughout much of the world today, which can make shopping and eating in restaurants easier. But you shouldn't count on using a credit card all the time:
- Not all countries accept all major credit cards.
- You're less likely to find credit card machines in the rural areas that bike tours typically explore.
- You never know when a shopkeeper's credit card machine might be out of service (just like at home).
So don't rely solely on credit cards for your spending, but they can be a good back-up plan. And don't forget to call the customer service number on the back of your card before leaving home to authorize it for use in another country. You don't want to find out the credit card company has frozen your card because they think it's been stolen! (Washing dishes to pay for your dinner is a great travel story, but is never much fun while you're doing it.)
Travelers checks were once the go-to solution for international travelers, but as they've declined in popularity, they've become more difficult to cash in at many destinations. But they still offer the security that cash never will.