Money, Money, Money


Money is at the root of many of the challenges we face as expats. First, there is the confusion of different currencies. For example, we are US citizens living in Spain but traveling regularly to England. Spain uses the euro while the UK uses the pound sterling and, of course, the US uses the dollar. All our income and assets reside in the USA, so we must constantly convert our dollars into pounds (£) and euros (€) and our thinking from one currency to another. Our smart phones have conversion apps, but who wants to pull them out while standing in the check-out line of the local grocery store? So we rely on rough approximations. A pound sterling is worth about $1.5, so we multiply by 1.5 when we are in England. Currently there is little difference between the dollar and the euro, so we consider that they are roughly the same. This is not a perfect system, but it works for us.

Retail foreign exchange
Retail foreign exchange

Another issue is how we actually acquire the foreign currency we need in Europe and the UK. Now that we are traveling regularly in England and the Eurozone, we carry small plastic ziplock bags filled with dollars, euros, and pounds. When we are en route we put away our money from the country we have left and replace it with the money from the country we are traveling to. When we leave a country we try to have a reasonable amount of its money in our ziplock bag so that we can squirrel it away until our return to that country. This will give us enough money to take care of immediate needs when we arrive, such as paying for a taxi or bus to our hotel. This also makes it possible to avoid using the currency exchange booths that you will find in nearly all airports and train stations. The exchange rate at these booths is generally terrible.

Since we live in the era of plastic, we can use our credit and debit cards to make purchases and to get money at local banks and ATMs in the countries we frequent. Alert your bank or credit card company about your travel plans to insure that the cards will work when you get to your destination. Nothing is worse than needing money on a Sunday and discovering that your debit or credit card is blocked. And make sure that your personal identification number (PIN) is in your memory as digits, not letters, so you can key it in at the foreign ATM machine.

Be warned: It may be impossible to find an ATM in a foreign airport or train station, and if you can find one, what sort of exchange rate will you get? We generally carry three or four cards with us in the hope that one or another will work when we need it. And remember, small towns may not have an ATM machine.

After putting our credit or debit card into the machine in a shop or restaurant, a note may come up on the machine asking if we want to charge the purchase in euros or dollars. The choice determines when the conversion is made. If we choose “dollars,” the conversion is made at that moment, in the country we are visiting; if we choose “euros,” the transaction is communicated to the US before being converted to dollars. In general, we feel that we get the best rate by having the conversion made in the US, so we choose “euros,” but there may be little or no difference between the two choices. Be sure there’s no additional service charge tacked on, especially at hotels, if you choose “dollars.”

In a restaurant, often the credit card machine is portable and brought to your table so you can keep your eye on your card at all times.

We have found that the best way to get foreign currency at a good price is to use our bank debit card. Credit cards have usurious fees for foreign cash advances. Many years ago we traveled with American Express Travelers Checks, but they are useless in most situations now. It is much better to have a small supply of the local currency and use debit cards to replenish our cash supply. BTW, the ubiquitous AMEX card is not widely accepted in Europe and the UK.

Another challenge is knowing the “expected way” of doing business in each of the countries we visit. In the USA we normally pay for purchases in cash, with a credit card, or by writing a check. However, in Spain payments are made in cash (“effectivo”), with a credit or debit card (“con targeta”), or by bank transfer. This is because in Spain there is almost no such thing as a check book. When we established our Spanish bank accounts we were given a booklet where all transactions are recorded. We run it through the ATM machine at the bank to update it. Merchants expect payment in cash or credit card. Larger items, such as monthly rent, utilities, phone, and computer WIFI are handled by direct bank transfer. The merchant gives you their bank transfer information and you go to your bank and set up the transfer, whether as a one-time charge or recurring.

Here are some examples of unexpected ways of doing business in foreign countries:

For US citizens—used to carrying checkbooks and writing checks to make payment—please realize that a check written in dollars will be useless in countries using other currencies even if they know what a check is.

We rent an apartment in Spain. The monthly rent is paid by automatic bank transfer to the landlord’s account. If anything needs fixing, the workman chosen by the landlord comes to the apartment and fixes the item and expects payment in cash from us. We, in turn, present the receipt we get from the workman to our realtor, who presents it to the landlord, who is supposed to pay us back, which often takes several months and often goes directly into our bank account.

Elyn signed up for a felting class and paid via a bank transfer at our bank.

Many government offices in Spain do not take cash or credit cards. You fill out forms, etc. and then have to go the nearest bank to transfer the money to the government account. You take the receipt for that transaction back to the government office as proof of payment.


The moral of the story is: don’t expect financial arrangements to work the same as they do in your home country, and be prepared as much as you can be. I consider the mental gymnastics of dealing with money as an expat as an exercise that keeps those “little grey cells” active. I go to the “mental gym” every day!

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