24 Nov

Managing Your Money: On The Road

Canadian Coins

So you’ve saved and saved and saved, put away your refund determined by a tax estimator, and now it’s finally time to hit the road. How are you going to manage that wad of cash while you’re away? The more thought and planning that you put into this before you leave, the easier it will all go while you’re on the road.





Managing The Bank Accounts

We used a two tiered bank account system:

  • Our primary savings account was with a brick and mortar bank in our home town. This account was the highest interest savings account we could find so that we could maximize the money our money was making for us while we were away.
  • Our daily use account was with an on-line bank that offered free ATM withdrawals in foreign countries. We kept at most $2000 at a time in this account and, as it depleted, we would transfer money to it from the primary savings account. We set this account up as a ‘bill payment’ on the primary account and would simply electronically pay the bill to fill up the account.

Debit Cards

Our main method of obtaining cash while we were away was ATM’s. We had barely any trouble finding bank machines everywhere we went. Every major city or town has at least one. If we were heading somewhere very small we would make sure we had taken enough out already. Even Laos, which by all accounts had a dearth of ATM’s, had more than enough to make access easy.

Depending on the local ATM fees (remember, our bank account didn’t charge any ATM fees but sometimes the local machine itself does), we would take out enough money to last a couple of days. Cash is king on the road so this meant we always had to have enough to cover transport, hotel, food, drink and entertainment.

Have a back up!!! We carried two ATM cards each for our daily bank account and an additional ATM card each for the savings account. We never kept all of these in the same place for obvious reasons.

The need for this became abundantly clear on the day that the ATM machine in Nha Trang, Vietnam munched on Jason’s’ card. We watched in horror as it repeatedly didn’t spit it out all the way and kept sucking it back in…and then it stopped trying and just kept it. Bummer.

Credit Cards

We used credit cards only for airline tickets and to secure reservations (if needed). The interest charged on credit cards is outrageous and so we paid the balance as soon as possible from our savings account. We used credit cards only for the convenience of them…it’s hard to pay for an online airline ticket with cash!

Ca$h Is King!

Cash ruled the world everywhere we went. Most places don’t take credit cards never mind debit cards and, even if they do, they likely charge more for the privilege (it costs them so they pass the cost on to you).

Never accept torn, ripped, dirty or wrinkled bills…if you do you are being used as a dumping ground for these bills. Merchants will often refuse bills that are torn, ripped, dirty or wrinkled too much so you shouldn’t accept them either.

Back Up To The Back Up

We carried $500US cash in our bags as the ultimate backup. We had heard that some visas and entry fees could only be paid in US cash (and found that to be true) so we brought this along for those occasions. We made sure that the bank issued us crisp, clean, unmarked, whole bills and kept them in that state as we travelled. Once in a while we found an ATM that dispensed US dollars (I have no idea why) and so we would top up this fund at that time, although the original $500 would have gotten us through.

Currency Exchange

Try to limit the cash you need to exchange at a border crossing – you will most definitely get ripped off. Not only is it a bad exchange rate but we found that sheisters tried (and succeeded) in confusing us by talking quickly, quoting exchange rates from one currency to American dollars and then into the second currency, and pushing to have the transaction take place quickly. More than once we walked away thinking ‘hey, wait a minute’…but it was done. We instituted a policy that we both had to understand and agree to the math before we made an exchange. If you want to get ahead of the game, click here to order your foreign currency before you get to your destination. That way you can avoid being ripped off!

Keep Track Of Every Dime

Always know the state of the budget. It’s fine to be over (and even better to be under!) but you should know where it’s going and have some idea whether you can make it up or not. The last thing you want is to run out of money before you run out of time!!

I set up a spreadsheet before we left that tracked all the money in about 6 categories (you can check it out here). We had a budget notebook with us all the time and would simply write down all the money we spent. Every couple of days I would update the spreadsheet – I had already set it all up to do the math so could keep track of it all very easily.


It’s your money…make it work for you!!

20 thoughts on “Managing Your Money: On The Road

  1. really really helpful especially for poor travellers like me hehe… love the last line too “It’s your money…make it work for you!!

    a lot of people dont realize that they could travel longer just by properly utilizing every cent they have

    thanks for sharing :-)

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  3. Hi Gillian. I was wondering how using the debit card/ ATM works with the exchange rate as I’m guessing you are not withdrawing US dollars from foreign ATM machines? Does the ATM tell you the exchange rate being applied? Is that determined by your bank or the bank where the ATM is? Can the exchange rate vary between different ATM machines?

    Great spreadsheet! It looked like Jordan was the most expensive country.
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    • Foreign ATMs normally spit out local currency and issue you a receipt in the same currency. Your only way of finding out the exact price paid in your home currency is through web banking. I have encountered one bank – in Romania – that also showed me a number in my home currency, but it did not exactly match the amount posted to my account.

      ATM exchange rates are handled through the visa or mastercard network, and are usually pretty competitive. The network charges a 1% commission, and your bank usually takes another 1% (though the second number varies by bank). Typical cash exchanges – not black market scams – charge 4%.

      With credit cards it’s much the same. However, in Ireland and the UK, there is one provider that charges in your home currency, and shows the exchange right on the receipt. This may exist elsewhere, but I haven’t seen it. However, if you see this, I’d recommend demanding to be charged in the local currency, as there’s a hidden surcharge for this service (my math showed a 4% commission, whereas the network normally exchanges for 2%).

    • We were always withdrawing local currency from the ATM’s and no, the machine did not tell us the exchange rate. We were charged the ‘buy rate’ that our bank charged for that currency exchange into Canadian dollars on that day – it didn’t depend on the machine at all.

      Jordan was expensive but it was also a heavy ‘do stuff’ country. With only 10 days in the country we were either paying to do an activity or paying to travel on every day…there were no down days to relax and do nothing and not spend any money. It’s actually not any more expensive than Turkey in reality.

  4. Gillian – seriously, one of the best how to manage money posts I have ever read. Thank you very much for the insight…my wife and I were just talking about what will be the best way for us to handle our finances on the road, and it was like you were eavesdropping…thanks again – awesome! (And yes, great spreadsheet too!!)

  5. Great post, we’re using a credit card (halifax clarity) which is paid off at the end of every month to fund our travels. The credit card offers 0 fees, so we only pay a charge from the ATM. Most debit cards in the UK charge at least £3 to withdraw money and then a fee for converting it.. so paying fiver per a transaction. This would have crippled us in Vietnam where most ATMs would only allow us to take out £60 each time!

  6. Very helpful post! We are using a pre-paid credit card specifically for travel, which is very handy because you can load up to six currencies and avoid those pesky currency conversion fees charged by banks for taking money out of the ATM and buying things in a different currency.

  7. Good post! In addition to the tips you’ve posted, we got a Capital One credit card because they don’t charge an international transaction fee. We use it anytime we can (which was decently often in Japan, Europe & South Africa, not so much in places like SE Asia and India) because our bank charges us 3% to take money out. Plus we’ve already earned a free plane ticket from Jordan to the UAE with the points. We make sure to pay it off each month (which can be easy to forget about when you are on the road).

    Also, if a place offers to convert a purchase into US currency, decline. Our credit card always gave us a better exchange rate than the one the merchant is offering, usually because it is through a 3rd party service.
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  8. Gillian – Awesome info!
    As I live in the same city as you (currently anyways!) I am excited to know that a banking institution exists that doesn’t charge fees for foreign withdrawls! Can you share what bank or credit union this is?

    • We used VanCity Credit Union (totally helpful!) and their on line affiliate Citizens Bank. However, Citizens Bank stopped their consumer account division about half way through out trip! We held out with them (past all the dire warning notices) for as long as possible – we figured they couldn’t just keep our money! In the end they were ready to withdraw our money and send a cheque to our mailing address, so we withdrew it all and just started using the VanCity account – which wasn’t bad, but not as good!

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