The Benefits of Bringing Cash When Traveling Internationally
educating-myself | Read Time: 3 minutes
By JC Fernandez-Seoane | Published: February 2023
Preparing for an international trip – whether for business or pleasure – can be an exciting time, but comes with many “to-do” list items before you’re ready to depart.
As digital adoption has continued to take hold in recent years, one often overlooked “to-do” is the need for money in your destination’s local currency. While many transactions can be accomplished these days with a credit card or smart phone, having cash handy is still an important part of any trip.
Here are tips on why you should get cash in your destination’s currency before you depart.
Why Bring Cash When You Travel Abroad?
Credit cards can be great tools, particularly for accruing rewards that may be useful during your travels or if you have a large expense you’re planning once you’re abroad. However, although credit cards are generally widely accepted in most countries, some vendors might not accept them, particularly if you are not staying in large cities.
Relying solely on credit and/or debit cards also leaves open the possibility of the card’s chip malfunctioning, your purchases being blocked if you didn’t give your bank a heads up before your travel, or foreign transaction fees depending upon the card’s terms and conditions.
You’ll need funds for things like transportation, food, excursions, tips and more, which you may find yourself unable to pay for using a card depending on the size of the business or vendor. In some countries, the vendors will gladly accept U.S. dollars, but the convenience to pay in U.S. dollars can come at a price if vendors apply an unfavorable foreign exchange rate to the transaction.
And while you can get cash at foreign ATMs, local banks will likely charge a fee and may limit the amount that can be withdrawn. These are just a few reasons why having cash in your destination’s currency is always a good option.
Why Buy Foreign Currency Banknotes Before You Leave the U.S.?
Purchasing foreign currency before you depart can provide convenience, savings, and perhaps most importantly, peace of mind.
It is important to have cash available when you land in your destination, especially during the first days of your trip, where you will likely incur expenses for taxis, train tickets, food, souvenirs and more.
Foreign exchange businesses at airports and locally at your destination often charge exorbitant fees, leaving many to fall into a “tourist trap” and end up paying more than they needed.
Why Buy Foreign Currency Banknotes at Your Local Bank?
Purchasing foreign currency banknotes at your local bank can provide a few benefits, perhaps most importantly, price. Getting your currency from your local bank is often the cheapest way of obtaining foreign currency banknotes, while the worst options for pricing are often airport vendors, hotels or exchange “kiosks” or counters in the country of destination.
In addition to a better price, obtaining your foreign currency before you depart provides you with added security, as you’ll be able to reduce the risk of being scammed by vendors, particularly in countries with weak currencies where there is an underground market for U.S. dollars. You’ll also have the added convenience of receiving your desired currency directly to your home, often times as early as the next business day.
Planning and preparing for an international trip can be fun, especially when you take the proper steps to ensure you’re fully ready to relax once you’ve arrived. Before you take your next international trip, make an appointment with your local bank to see what options they provide for purchasing foreign currency so you can hit the ground running.
About the Author – JC Fernandez-Seoane
JC Fernandez-Seoane is WSFS Director of Foreign Exchange. His main goal at WSFS is to design and deliver foreign exchange risk management solutions to the Bank’s Clients. JC has always worked for international banks in the foreign exchange and financial derivatives markets, first in Europe (London, Paris and Madrid), and later in New York City.
JC received a master’s degree in international economics from Sciences-Po in Paris, an Executive MBA from London Business School in the UK, and a master’s degree in Extension Studies from Harvard University.
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