At some point in your life you may find yourself making a purchase in a foreign country with a credit or debit card. When this moment arises you might get asked a specific question that you have likely not heard before. “Would you like to pay with US dollars instead of the local currency?”. It doesn’t happen every time you make a purchase but I decided to do a little digging to see why this was even an option. I’m glad I did because knowing this has actually saved me quite a bit of money along my travels.
Would You Like To Pay With Local Currency Or USD?
You probably won’t really give it much thought when it first happens but when you start to notice a pattern you may start to questions things.
I briefly remember a super talkative Norwegian girl that I met at one of my hostels in New Zealand who told me that “whenever you are in Norway make sure that you always choose to pay in Norwegian kroners cause it’s cheaper” or something. I didn’t think much of it until I came across an instance (weeks later) when I was trying to book a flight from Sydney to Melbourne and I was given the option to pay in USD or AUD at check out.
When I was booking my flight I couldn’t quite recall who told me to pay in local currency but I remember it being some sort of random traveler advice from another country in my not-so-distant past so I opted to pay in Australian dollars instead of USD. It turned out to be a great decision.
When I checked my bank account to see what sort of exchange rate I got through my bank, I was delighted to find that the Norwegian girl’s advice in the back of my mind somewhere had managed to save me $6.61 instantly at check out.
Paying For My Hostel
This also happened to me while l I was checking into a hostel and the young woman at the counter asked me if I would like to pay in Aussie dollars or in US dollars. Since I was now a bit more aware of what was really happening I decided to pay the local Aussie dollar and keep my receipt to see how it would reflect with my bank statement. Sure enough, the hostel was trying to get a few more bucks out of me by offering the illusion of a cheaper rate by showing you both numbers right next to each other.
I can only conclude that they offer these services to holders of currencies that are valued higher than the local currency so it looks like some sort of deal when you see a cheaper price right next to the local price that you are about to pay.
The Savings Can Add Up
The total USD savings of $15.07 (which is about $17 AUD) from just these 2 transactions is enough to eat a nice meal, pay for half a night’s accommodation or a few beers and when you’re traveling on a tight budget, those can be some rather nice luxuries that can either make or break your experience somewhere.
In conclusion: When paying with plastic and the above question presents itself, always use the local currency because you will almost always get a better exchange rate through your own bank or credit card than you will through the business who is receiving your credit/debit transaction.
Also, if you fee that this post or other posts by me add value to your trips, reduce stress, save you money when you travel (like $15.07) or just help you to travel more with less, then please subscribe, add, follow and like me on as many social channels as you see fit. I am also be super appreciative of anyone who shares my articles too. Thanks.
Have you ever been asked this question when paying for something abroad? Well, now you know that your bank will give you a better exchange than their bank so it’s always best to pay with the local currency and not in your own.
