Best way to carry cash when traveling

Airport exchange rates

Taking cash on international trips is the worst option. It’s more expensive and dangerous than debit cards and credit cards.

1. Cash is expensive. Those exchange rate kiosks (Travelex) located at expensive, prime airport locations can cost you 10% in bad exchange rates and fees (25% at the location in the picture). While their spread (the difference between the buying and selling rate) can drop below 2% at downtown locations in cities like Moscow, it will never get you the rate of debit cards. Visa and Master Card spread is 0.4% for the Euro.

2. Cash can get lost/stolen. Travel can be stressful and there is a chance your cash can get lost or stolen. Carrying several debit cards in separate locations eliminates that risk.

3. No insurance or cash back. Carrying a credit card instead can get you a minimum of $500 cash back as well as free travel insurance.

Altogether, for international trips , it's better to take debit cards (read more) and credit cards.

There are, however, 3 advantages of taking cash for an international trip:

  1. Cheaper with cash. Just like in the US gas is cheaper when paying with cash, some small stores abroad offer a cash discount. However, the best is to get cash at a local ATM.

  2. Countries with US sanctions. I have traveled to over 180 countries and in a few of them I was unable to use an ATM, mostly due to US sanctions. Cuba is an example. This is an exception though. There is an ATM even in Antarctica.

  3. Hyper inflationary countries (e.g. Venezuela, Zimbabwe). Cash, denominated in dollars or euros, works best in those countries.

What is the best way to carry cash when traveling? Not carrying much.

I always carry $50 or €50 in cash and then get more cash at an ATM at the airport.

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