Foreign Currency Values
Just curious to learn how viajeros here handle foreign currency exchange.
Just wondering what some of your experiences have been.
Are the rates better at Banks? Or at the private currency exchange shops? Have you ever used the "Black Market?"
Have you learned a "formula" to calculate the value of your native currency? One not needing a calculator?
I have when in Mexico - a peso is worth 7.7 cents, meaning that 10 pesos is just short of 80 cents. 200 pesos, about $16.00 - close enough for me.
Or, maybe, you just don't worry about it?
And has anyone traveled to Columbia lately?
The Columbian peso, for example, seems to be a bit challenging. According to a currency exchange website, a US dollar will get you 2,000! Seems like one might need a huge shopping bag to carry $20 worth.
5 Answers
Are the rates better at Banks? Or at the private currency exchange shops? Have you ever used the "Black Market?"
In my experience in C. and S. America, banks and atms are typically pretty close to each other, exchange shops often a bit better (and you can sometimes haggle at a currency exchange), and the "black market" is typically just someone standing on the street, and can sometimes offer you better than the exchange shop. The worst you will get is by paying for something in a shop with your foreign currency and then receiving change in the native currency (not that you will be given less change than you are due, but that you will often receive the least favorable exchange rate). With atms you pay widely varying withdrawal surcharges, sometimes nominal and sometimes quite high.
ATM's all the way!
I also find it interesting to hear how other people do the calculations. My husband does it like you, in that he calculates that 1 Mexican peso is roughly equal to 8 cents US at the current exchange, and then he goes from there. I do it the opposite way...I calculate that there are approximately 12.5 pesos to $1US. If something costs 8 pesos, he figures it's around 65 cents US, whereas I figure it's around 2/3 of a dollar, which would be 66 cents US. This system works well, except for major purchases like kitchen appliances or furniture. At that point we get out the calculator and actually get it to the closest penny.
Regarding Colombia and other countries experiencing significant inflation, isn't it common for the problem to be "solved" by changing currency? Mexico had been stable at 3 pesos to the US dollar for several years - maybe someone knows how long. Then suddenly the whole bottom fell out and there were something like 300 or maybe 3000 to the dollar (it was long enough ago that I am sorry not to have a clearer memory). I do recall, however, that the Mexico gov't issued the "nuevo peso" which replaced the regular peso, and then after several years the "nuevo peso" just became known as the "peso" again.
Someone could provide you with a lot more historical information, I am sure, but I have a memory of reading about Peru, Argentina, and Venezuela doing something similar.
Hi Volpon
Be careful changing money on the street. You can be given counterfeit notes - I know from personal experience.
Hello, Ian-Francis
Good advice. Thanks.
There is no black market in Mexico, where I travel most. At one time, there was in Jamaica, but I avoided it. Never a good idea, as you say.
As mountaingirl points out, the ATM has made exchanging money very easy.
Some US banks have co-operative arrangements with foreign banks, like the one Bank of America has with Banco Santander in Mexico.
(Since Santander is headquartered in Spain, maybe in Spain, too. Anyone know?)
I use Santander's ATM's almost exclusively and receive the very best exchange rate (a 1% discount) and no fee.
And on a related topic, to my knowledge I have never been shortchanged while making purchases in stores or with street vendors. Honesty seems to be the rule.
However, I rarely carry US currency. When in Mexico, I only use pesos.
Another technology has made extended stays worry-free: I periodically check out my bank's website and monitor what's going on. In fact, I do all my bill-paying via web: I only write one check a month - to the local refuse company.
I remember that once upon a time handling money affairs was a hassle when in another country. But no more.
