Money is always a topic that comes up when planning a trip.

Right from the start money is critical to the entire equation.  How much is the trip going to cost?  Flights, accommodation, insurance, tours and so on.

Once you have these all squared away comes down to the nitty-gritty, usually closer to the trip.  Do I need cash or will I used my credit card?  If I need cash, how much and in what currencies?

Many years ago, I crossed travellers cheques off my list of cash options – way to fiddly to use.  We had an instance in Tonga, where a traveller in our group had her bag stolen, with all her travellers cheques in it – she couldn’t get them reimbursed before we left, so was without cash the entire trip.  In some places trying to change travellers cheques will be next to impossible.  I don’t recommend them.

In most instances you will need at least some cash in the local currency of the place you are travelling.  But this entirely depends on the country and your plans.  For instance, pretty much everywhere in the USA will take a credit card.  I have spent weeks in the US and only used a handful of dollar notes for tips, using my credit card for everything.  Other  countries such as Japan, you will find credit cards aren’t readily accepted & cash is required.  The chances of getting robbed or mugged is very slim in Japan though, so this isn’t high risk to carry cash on you.  Some places such as parts of Asia have their own currencies, but also will readily accept US dollars and/or currency from the neighbouring countries.  Laos is such a place – Laos Kip, Thai Bhat and US dollars are all readily accepted and you can get back change in any of these currencies too.

If we are travelling somewhere, where a credit card is a good option, often we will just take out one credit card with us for the day, leaving the second card back in the safe of the place we are staying.   This means in the event of something unforeseen, one card is safely locked away.

I’ve recently looked into a preloaded travel card which a number of banks seem to now offer.  Maybe I’m missing something but I simply can’t see the benefit to this?  Why not just use your Visa card in the first place?  The only benefit to the card I can see, is to put money into the bank via more fees.  Bugger that!

So it looks like we are back to the same old story with using cash for smaller and credit cards for larger purchases.  However, as much as possible, I prefer to pay as much of the trip off in advance to spread the cost and have it mostly paid off before I go.

In terms of how much cash you will actually need to get before you go, that’s tricky.  I usually work out how many meals per day I need to purchase. I check a few menus of places we will likely dine, this gives a rough idea of the cost of eating.  Then I factor in a couple of drinks and a snack per day.  Then add in expected entrance fees, donations to museums or temples.  Transport can be a big expense – getting from/to the airport and then around and about.  Then add a bit more for incidentals you hadn’t thought of.

Once we have been to the bank to get the cash, we will then typically then split up the money between us.  At times I have been known to sew the majority of my cash into my pocket.  The only time it comes out of my pocket is when it goes into the safe in the hotel.  We aren’t talking thousands of dollars, but why take the chance of loosing it even a small amount or having it stolen.  Either is a complete pain the butt and a waste of valuable holiday time.

Its also important to think about a contingency – what happens if you need to urgently leave the country, say due to a natural disaster.  Do you have the funds to do this, either in cash or available credit card balance?  Worth keeping in mind.  Sure you may have travel insurance but it doesn’t hurt to have another escape route.

I’d be interested to know what others do in terms of holiday spending money?