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Exchanging Currency for a Trip to Mexico
By ForexTraders.com & Photos by Jesús de Avila

A Mexican vacation starts with planning

Just the thought of traveling through Mexico is exciting. Mexico is filled with incredible beach resorts, ancient cultural treasures and a population that is constantly redefining itself in terms of world importance. Mexico has one of the largest tourist industries in the world; tourism accounts for almost as much revenue as crude oil exports.

Mexico is experiencing some difficult economic times. Over 80% of its exports go to the United States and if the US is not buying, Mexico feels the pain. The Mexican Peso’s value has been affected by the economic downturn. The value of the Peso continues to fluctuate against all currencies, so it’s important to put a travel budget in place before you leave home.

Waiting until you reach Puerto Vallarta or Cozumel to exchange currency can be an expensive mistake. Mexican exchange merchants charge high transaction fees and may not use a real time exchange rate. That means your currency exchanges could cost you more than necessary. If you use your credit card to exchange money, you may pay more than one transaction fee, plus credit card companies add a surcharge to every trip purchase, so you don’t know how much you’re actually spending until you get your statement and by that time your budget is a disaster.

Find a professional currency broker before you leave home. A professional will help you develop a currency exchange strategy that fits your budget, so you avoid unnecessary transaction fees and surcharges. That means your currency is worth more in your host country’s currency. When you exchange money with a broker, it’s securely sent to you through an overnight service.

A currency broker will help you average your currency exchanges

A professional broker watches currency market 24/7 and will offer you a real time rate every time you exchange money. A broker can help you average your exchanges. Averaging is exchanging small amounts of money at different times while you’re planning the trip so you avoid sudden values surges in the Peso, which can destroy your travel budget. A broker does make a profit, but you save money because there are no hidden fees or surcharges. Those charges are standard for banks, credit cards, airport merchants and hotels.

Avoid airport exchange merchants and Hotel exchange rates

Airport exchange merchants pay high rent and they expect you to help them pay it. You’re considered a captive audience, so they add extra fees and may not use a real time exchange rate. Extra fees and inflated exchange rates increase their profits. Hotels know you like the convenience of exchanging money with them and they make you pay for that luxury. You may pay as much as 20% more when you use a hotel to exchange money; that’s a budget breaker by anyone’s standards.

Other travel tips

You can carry up to $10,000 cash through Mexican customs without declaring it. If you have more than that, you must declare it, or customs will confiscate it. Always cash in a money belt, leg pouch, or hidden pocket that’s secure and out of sight and use hotel safes when you reach your destination. Follow local security tips and use common sense. It is your best security tool when you use it.

ForexTraders.com provided this article to help you understand the importance of exchanging currencies to maximize your budget for a trip abroad. Visit Forex Traders to learn all about trading currencies and the forex market. Email to a friend

Andrew Carter
ForexTraders.com

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