Financial Savviness when Traveling - Enjoy your Holiday without Overspending or Feeling Financially Cheated

 

When traveling internationally, a bit of financial savviness can help you save some cash during your trip.  Here are a few easy financial tips to help you realize some savings during your next trip:

1)      Best Way to Get Foreign Currency – instead of purchasing foreign currency for your upcoming travel from your home bank before departure, or exchanging currency at a private currency exchange desk located at the airport arrival lounge, your hotel or city center, you may want to consider withdrawing directly from your bank account in the foreign currency through a local bank ATM in the country you're visiting.  You can find ATM located around the city, at the airport, train stations, in the super markets etc. The ATMs may charge you a small service fee which is probably lower than what you might pay at the currency exchange centers.  If possible, check a few local ATMs to find  one with the lowest service fee.

 

2)      Credit Card with NO Foreign transaction fee – when traveling overseas, you’re generally assured the best exchange rate when paying by credit card.  For best value, you should use a credit card that does Not charge foreign transaction fee as otherwise you may end up paying a fee for using your card overseas

 

3)      Opt to pay in the local currency by Credit Card – Often times, the merchants (i.e. shopkeepers, restaurants, tour operators etc.) in the foreign country you’re visiting may ask you if you’d like to pay the bill in your native currency (i.e. currency in which your credit card was issued) or pay in their local currency.  It is most prudent to pay in their local currency.  Why? Because the credit card company does the currency conversion at the official exchange rate (usually the interbank rate), which is much lower and fairer whereas the merchant processes the currency conversion through their DCC (Dynamic Currency Conversion) provider at a marked-up rate (5-7% higher). The merchant generally pockets the difference which means you end up losing out on a good exchange rate

 

4)      Apply for VAT Refund – in many countries, especially in European Union, you can apply for VAT (Value Added Tax) refund.  In EU, VAT is like the sales tax in the US but much higher.  In some countries, you can apply for VAT refund at the airport.  Your hotel or local shops should be able to guide you on the VAT refund process

 5)   Tipping & Extra items on table– try to find out the tipping rules prior to traveling so you’re aware of the local customs; in some countries tips are already included in the bill, so you may be over tipping by leaving more money on the table if you’re not aware that it’s already included.  Also, in some countries, the servers leave bread baskets and water bottles on the table, that you may think is complementary, but later they charge you for it. It’s best to ask them upfront if these items are chargeable or not, to avoid issues later. (P.S: check out my Food without Borders (Global Cuisines) blog to explore dishes from around the world that won’t break the bank!)

6)  Bargaining – want to brush up on your negotiation skills? Nothing like bargaining with local shopkeepers in various countries.  Not to mention that exhilarating feeling of having struck a good bargain… until you visit the next shop and find out that this vendor’s starting price is lower than the purchase price you negotiated with the previous vendor :(

 

7)      Local Transportation – I invariably use public transportation instead of private taxis.  For me, it’s the best way to interact with the locals and find my way around a city/country.  Plus it’s comparatively safer and more cost effective.  I may opt for first class if required

 

8)    A Souvenir to Remember – if I were to choose between buying five little trinkets or a single, solid souvenir, I'd almost always opt for the latter.  I’d rather spend a bit extra if required, on something that's been created locally and is culturally relevant, visually appealing and durable

 9) Buying Bottled water – bottled water costs add up rather quickly.  This expense can be minimized or eliminated depending upon your travel destination.  In some countries you can bring your water bottle and fill water from a water fountain at a hotel or public fountains around the city.  Sometimes hotels also provide complimentary water bottles.  Most of the time, I've managed with filling water from a fountain or with a complimentary bottle from the hotel

 

10) Buying SIM cards in foreign countries – if you plan to make a lot of phone calls and use the internet extensively on your mobile phone during travel, then you may want to consider whether it makes financial sense to buy a local SIM card in the country you're visiting or use your mobile phone plan.  Please stay tuned for my separate blog, coming soon, on this topic: Local SIM or your Mobile Service plan

Good luck managing your travel finances on your next trip! Got any travel-savvy money tips? I’d love to hear them!  Please share in the Comments section below.

Until next time, folks.  Stay sharp, stay curious 🎯🌍✨