Economy Analytics

Save money when traveling abroad by thinking like an economist

Jay L. Zagorsky, Boston University

Leer en español.

A record number of tourists and business travelers visited a country other than their own in the last years, and this year is already on pace to exceed that tally.

One thing you definitely need when traveling abroad besides a passport is local currency, such as euros in Europe, yen in Japan or rubles in Russia. In the past, travelers would typically withdraw what they need from an ATM in the country they’re visiting or simply use a credit card, letting their bank calculate the cost in their home currency at roughly the market rate. There was usually also a foreign transaction fee.

Increasingly, however, retailers, restaurants and ATMs are offering travelers the option to pay or withdraw money in terms immediately converted into their home currency. Companies offering the service call it “dynamic currency conversion.” For example, an American tourist visiting Paris is able to use her credit card to pay for a fancy meal at a French bistro in U.S. dollars, instead of euros.

This may seem innocuous – or even convenient – but agreeing to use your home currency in a foreign land can significantly inflate the cost of every purchase. Thinking a bit more like an economist can help you avoid this mistake, and save a lot of money.

Surge in tourists

A century ago, international travel was only for the rich. These days, almost anyone from an industrialized country can see a bit of the world on a budget.

While people commonly complain about “high” airfares, the real cost of flying has never been less expensive – it’s half what it was in the early ‘80s – or safer.

And that’s one reason why a record 1.24 billion people visited another country in 2016. Naturally, financial firms have sought to capitalize on all this wandering by inventing ever more ways to separate travelers from their hard-earned money.

Buying things abroad

Tourists rely on credit, debit or ATM cards to pay for hotels, restaurant meals and local trinkets.

A complex international computer network checks if a card is valid for the transaction and transfers the money. Traditionally, to help pay for this, banks and credit card companies have charged customers a foreign transaction fee.

However, banks are now offering more cards with no foreign transaction fees. At the same time, “free ATMs” are popping up around the world that don’t charge local transaction fees (though your own bank may still do so).

So how do banks cover the costs of these transactions if they are increasingly letting consumers use the system for free? One way is offering the option to pay in a user’s home currency. Even some bankers warn against consumers doing this because the exchange rate used is much worse than the one your bank would offer.

For example, say you’re a Spaniard visiting New York City and shopping for some clothes at a department store. After scouring the store for the right sweater for your mother, you go to the cashier to pay the US$50 bill (tax included). After you swipe your Spanish credit card (which boasts no foreign transaction fee), the cashier asks if you’d like to pay in euros instead of dollars.

If you stick with dollars, your bank would convert the price into euros at about the market rate, €43 at the moment. If you choose to pay in euros, however, the currency conversion includes a fee for the privilege, which may be as much as 10 percentage points. So you might end up paying about €47 instead.

The same thing happens with ATMs. Last year, I was in London’s Heathrow Airport and needed some British pounds. In the old days, an ATM would simply offer a few denomination options, issue me money and my bank at home would eventually calculate the cost in U.S. dollars. Instead, the airport ATM asked me if I wanted to lock in the exchange rate and know exactly how many dollars would be debited from my bank account.

I wanted £100 and tried two different ATMs. The currency rate offered in dollars ranged from almost 4 percent to 10 percent more than what my bank charged (or about $134 to $142). I rejected both offers, did the transaction in the local currency and ended up with a total charge of just $129 from my bank.

I have observed numerous international travelers as they made this choice, such as an Italian family arguing about it at the next ATM, and most chose the dynamic conversion into their own currencies.

So why do travelers pay more by accepting a worse exchange rate when they could simply say no?

An ATM at Heathrow Airport offered to debit my bank account in U.S. dollars rather than the British pounds I was withdrawing. The rate it charged would have been $1.42 per pound, or 14 cents above the market rate that day.
Jay Zagorsky, CC BY-SA

Three functions of money

Economists consider any item as money if it performs three different functions: unit of account, store of value and medium of exchange. Two out of three explain why so many international travelers act the way they do.

The first function of money is a unit of account, which is how people post and keep track of prices. This is why banks and credit card companies get people to agree to pay in the currency where they live, instead of using local money.

When people travel to a country with a different currency, they often mentally keep track of their spending using their home currency, converting all prices in their heads as they shop and eat. If an ATM or credit card terminal asks if you want to pay for something in the currency you use as your unit of account, your brain says yes.

Money also acts as a store of value. Items used as money provide the ability to make purchases now and also in the future. At the end of a trip, travelers not planning on returning to a country tend to spend leftover money in airports buying things they don’t really want. They don’t want to hold onto foreign bills since they are not a store of value. For the same reason, they prefer to be charged in their home currency when getting money from an ATM.

Money is also a medium of exchange, which is anything readily acceptable as payment to buy or sell goods and services. This is why people have to convert money when they travel abroad. In New York City, a dollar bill is a medium of exchange for food, drink or a ride on the subway. However, those dollars are not a medium of exchange in, say, China, where waving a wad of greenbacks would mostly get you stares. And that’s why travelers must convert money from one currency to another.

Currency calculation

How to save money abroad

When faced with an ATM or credit card machine that asks if you want to convert to your home currency, I recommend you decline, especially if you went to the pain and effort to ensure you have a card or bank with no extra foreign exchange fees. Even if you don’t have one, and your debt card charges a fee, in most cases it still makes sense to use the local currency.

An exception to this rule, of course, is if your bank or credit card charges a very high fixed foreign exchange fee and you need only a little bit of money. If this is your case, then saying yes might save you money even if you get a poor exchange rate.

The main thing: Think it through. Resist your natural inclination to say yes just because it makes you feel comfortable. Don’t be fooled when asked if you want to complete a transaction using your home currency. Using the local currency can save you money, making your next trip abroad less costly.

This is an updated version of an article originally published on July 27, 2017.

Jay L. Zagorsky, Adjunct associate professor, Boston University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

The Conversation


World’s most powerful passports

Germans can travel to 127 countries without ever showing a visa. This makes international travel cheaper and easier than it is for citizens of many other countries, like those from Afghanistan, who can enter just 5 countries without a visa.

US citizens can visit 116 countries without having a visa before, other 50 they need a visa immediately on arrival. So it’s a powerful passport. But even that could change over the next years under the current administration. If US foreign policy relations sour with other countries, like Mexico and Germany, visa-free agreements could freeze or break, which would damage the passport power for US citizens.

IN 2019 there are 197 countries worldwide.

Here are some of the 10 highest-ranking countries traveling visa-free.

1. Luxembourg, Singapore, Finland, Denmark, Italy and Germany-  Can travel to 127 Countries visa-free

Germany Singapore passport

2. Spain, Netherland, Belgium, Austria 125 countries visa-free

3. Portugal, Malta, Czech Republic – 124 countries visa-free

4.  Switzerland, Norway, Hungary – 123 countries visa-free

5. South Korea, Lithuania, Slovenia, Latvia, Cyprus- 122 countries

6. Poland, Slovakia – 121 countries

7. Ireland, United Kingdom – 120 countries

8. Malaysia – 119 countries

9. Romania- 118 countries

10.  Croatia, Liechtenstein, Hong Kong- 117 countries

For further and detailed information for all countries and a more complex ranking considering the categories visa-free / visa on arrival / visa required you should Check here the Passport Index

In this ranking considering all categories the United Arab Emirates are ranked No. 1 (visa free countries: 116; visa on arrival 57, visa required 25).

Hardest times for getting a visa have citizens from Afghanistan (168 countries require a pre-visit visa application and approval, visa-free only 5 countries).

Biggest and Greatest Zoos to Visit in the World

Do you love animals, traveling and visiting amazing zoos? Well, we have compiled a list of the biggest and greatest zoos in the world for you to visit!

Forget the idea that zoos are synonymous of  small caged animals and poorly maintenance. The world is full of places where the animals are super well treated and only get from the good to the best. And the coolest of all is that, depending on the country you are, you can see local animals that are super rare for the rest of the world, such as pandas in China, koalas and kangaroos in Australia, and others.

Some of them have extra attractions, such as Sydney Zoo, where the landscape is almost as cool as the animal life, or San Diego Zoo, where you can spend the night “camping” or Singapore Zoo, where you can do a night safari.

1) Toronto Zoo

With an area of 710 acres, the Toronto Zoo is the largest in Canada and boasts over 16,000 exciting animals to see. The zoo itself is divided into geographic regions (i.e. Africa, Eurasia, Canada, the Americas, Indo-Malaya and Tundra) to make it easier to understand the origin of the animals.

2) Bronx Zoo.

Located in the Bronx, New York, this zoo is the largest and oldest metropolitan zoo in the USA. It features over 6,000 animals with some exciting exhibition such as the World of Reptiles and the World of Birds where you can see a whopping 650 species. The animals are currently living in environments that recreate the habitat from which they were removed, whether it be a tropical forest or an African savanna. The Zoo also serves as a center for the rehabilitation and conservation of several species. On Wednesdays and on weekends the entrees are cheaper.

3) Beijing Zoo.

This zoo dates back to 1906, when it first started to house rare species. The Beijing Zoo is the oldest Zoo in China. Here, you can enjoy seeing over 14,500 different animals and over 500 species of marine creatures. In addition to tourist attraction, it also serves as a research center for some rare species. The place still has typical Chinese gardens with plants, streams and lotus flowers. The most notable feature of this spectacular zoo is definitely the Giant Pandas which are a hit with everyone! The Zoo is open from 7:30 to 17:30.



4) Berlin Zoological Garden.

As the oldest and most popular zoo in Germany, the Berlin Zoological Garden doesn’t cease to impress. Visitors come from all over Germany (and Europe) to spot the zoo’s 17,000 animals (which is the world’s biggest collection of species). Like the Beijing Zoo, the Berlin Zoological Garden is most famous for its Giant Pandas which are kept in pristine conditions.

5) Henry Doorly Zoo.

The Henry Doorly Zoo is located in Omaha, Nebraska and is the largest zoo in the world! It wins the number one spot as its combination of size (130 acres) and the number of species together make it the biggest. Also, it has an amazing cat complex which is the biggest of such complexes in North America, as well as a vast indoor swamp, the biggest glazed geodesic dome on Earth and the world’s largest indoor desert! It is for all these reasons that the Henry Doorly Zoo is certainly worth a visit if you happen to be in Omaha, Nebraska!

6) Taronga Zoo.

Only the way and the view are already worth the ride. Located on the other side of Sydney Bay, the Taronga Zoo is a few minutes by ferry from the city center. There are more than 4,000 animals, including native species of Australia, such as koalas and kangaroos. The zoo also guests 19 chimpanzees. The cable car ride inside the zoo is a must do. Do not forget to take your camera!

7) National Zoological Gardens of South Africa.

As expected, the African wild animals are the majority in this charming Zoo in Pretoria, South Africa. There are more than 9.000 animals, more than 700 species, and many of them were born on the spot. Leopards, rhinos, lions, elephants, giraffes, among others, can be seen there. But the Zoo also has a large number of animals from other regions of the planet, including pandas and marmosets.

Check out their website below for opening time and prices:

Toronto Zoo ; Bronx Zoo ; Beijing Zoo ; Berlin Zoological Garden ; Henry Doorly Zoo ; Taronga Zoo ; National Zoological Gardens of South Africa

View from airplane

Tips for a stress-free flight

Traveling can be demanding, and airplane journeys are some of the most stressful parts of vacations. With planning ahead, you can turn it into an enjoyable occasion. Some easy steps can take away many of the stress of air journey.

What to do at least one day ahead:

1) Pack your luggage. Ensure that all of your packings are completed at night before. You should store all of your luggage in a single place, so you can simply grab it when the taxi arrives or to reach the car/ bus.

2) Have all of your travel paperwork and documents organized and stored in a single central spot, best is in your cabin bag.

3) Make a checklist of all of the stuff you need. Secure your home by checking the electricity, water sources, windows, and doors- keep them closed. Do that latest an hour earlier than you leave your home.
Like this, you can reduce the little nagging stress during your journey that we all know.
You can also hire a housesitter, to stay in your home during your vacation.
Alternatively, ask a neighbor or family member to check on your home frequently.
Water the plants.

4) Organize your pet care. Make any pet hotel reservations before your journey to make sure you’ve gotten a reserved and cheaper spot at a place you trust.

5) Check the airline’s website the day before, especially for online check-in if provided. Don’t forget to check how early before the actual flight, you must arrive. So you don’t risk missing your flight. It frequently happens to people underestimating border control time and luggage check-in.
Also, if you leave your car at the airport, ask if there are any parking restrictions, you need to be conscious of. Ever since 9/11 in the USA, when there is an increased threat level, there might be expanded car safety checks before you can park at the airport, which might take some time.

6) Make sure that cabin bags are really cabin bags. Check online all the allowed proportions. You can check also on this website: It can be tricky, many companies earn a lot on baggage fees. In any other case, you might get stopped on the gate and have your bag taken away to be stowed with the standard baggage. It’ll delay and stress you. And it’ll delay everybody else. The fees at the airport for buying additional luggage are way higher than if you buy them before online.

7) In case you are solely taking cabin luggage, the online check-in is the most comfortable way of traveling. Many aircraft companies allow you to check-in online 24 hours before your flight.
This means that you can get and print your boarding passes at home or save them on your mobile phone.
When you get to the airport, you go straight to the gate and your boarding area without standing in line for checking-in.

8) If you have to change planes, it may be a problem, particularly within the bigger airports. Best is to check before the map of the airport, memorize the gate and calculate the time you have to get there.
You can also ask the flight attendant during the flight, but best is to be prepared, so you will have less stress.

Airport schedule

Actual travel day:

1) Depart your home in time, best a lot of time ahead. Around big cities and urban areas, traffic can be the most stressful danger of missing your flight.
Leave one hour earlier than recommended at the online check-in so you can anticipate busy traffic or accidents happening. Whether it is an hour to get to the airport, you should need to leave an additional hour earlier, just in case, there are highway issues.

2) In case you are checking in luggage, be ready to wait in line. If it’s a busy time of the day at the airport and you’re traveling with a popular airline, there might be a very long line. Don’t be afraid, no matter how long the line is. As long as you arrived on time, you don’t have to worry. Either the airplane company or the airport has to take responsibility for delayed flights. So even if it might look impossible to make it on time, you can try to relax. Departure, in most cases, is guaranteed.

3) When boarding the airplane, take your seat as soon as possible and stow your baggage rapidly. Many people block the aisle for a very long time and cause themselves and other passengers unnecessary stress. So simply get your seat and sit down. You will have plenty of time to stand up as soon as the airplane is in the air.

4) When the airplane lands, patiently wait for your opportunity to leave your seat. Whether or not you push or simply wait, you will not get off the plane any faster. Making an attempt to hurry is going to cause you and others stress. In the end, you all have to wait either again at the passport control or at the baggage pick up.
If you travel only with a cabin bag, that’s it. The stress is almost over.

5) In case you have baggage to pick up, there’s yet one more step. No disappointments, if you expect your bag to be the last one. So you will be pleasantly overwhelmed when it comes out early.

By following these easy steps, you’ll discover that your stress level on your air travels will likely be less. It seems like these are all self-explaining pre-cautions, but if you don’t prepare and follow most of the described recommendations, they might blow up to be a disaster.
Eliminate small stress factors, so they can’t grow into bigger ones and destroy the vacation at the very beginning. And do not balloon right into a full-blown disaster. Planning indeed improves the joy of your journey.

Woman sitting at a porch by the sea

How to travel for free- Housesitting made simple

Save money traveling and become a reliable housesitter.

Housesitting is an excellent way to travel anyplace on earth – people travel all over the world, and they live almost all of the world. So this is a win-win situation for homeowners and housesitters.

Benefits of becoming a housesitter:

It’s providing free travel accommodations, what else one needs. You only pay a membership fee after you decide to go pro. Before you can check and discover if this is the right way for you to travel.
To become an official housesitter provides the homeowners and the housesitters with safety.
There are housesitting directories where you can choose the places you are willing to live in.
As a homeowner, you can register your house or appartement and say for how long you will be absent and what’s in your home that needs a sitter like pets or plants.

As a housesitter, you choose your travel destination by the criteria that fits your vacation requirements:

  • city trip
  • beach holiday
  • mountains, rivers, lakes
  • select the duration of your stay between a couple of days, weeks or even several months
Woman chilling in front of a house
Woman in front of a house

Register at a housesitting platform- Become a House Carer

You need the right platform to start your Housesitting career. Read the blog, the experiences of other housesitters and homeowners. Best is as always to just do it. has been securely matching Housesitters with Homeowners since October 2000. You can Subscribe for free at Then if you are impressed by the travel opportunities, you can subscribe for more features. It definitely pays off.

Experienced Housesitters can offer special services:

  • Garden work (mowing and trimming)
  • Watering plants
  • Walking, feeding, and caring for pets
  • Picking up newspapers, answering the phone
  • Managing bills and even payments if both sides agree
  • visiting grandma

Typical sitters are:

  • Retirees
  • couples who enjoy traveling
  • travel bloggers that want to live abroad on a budget
  • world travelers who try to save on expenses
  • students trying to make ends meet
  • people sorting out their life goals, to fill time between two jobs
  • someone whose house is going through renovation
  • A person that just moved to a new place and can’t find an affordable home in the beginning. When you are new in the community, usually it takes time to learn about local rents

In recompense for their services, a housesitter will receive free rent and (usually) an additional fee. Housesitters are generally responsible for their own well being, health insurance, and food, of course.

For Homeowners

For house owners, it’s a fantastic opportunity to gain safety for your house, provide care to your pets, and save money in many aspects.
Also, it spares your relatives and friends precious time and efforts or saves costly pet care charges, and it also reduces pet stress.

  • Prevent break-ins. Statistically, the likelihood of break-ins is much higher in empty homes. Burglars often observe homes for some time before breaking in.
  • Housesitters can recognize fires, roof leaks, and different potential emergencies, especially if you are absent for several months.
  • Housesitting can spare much stress to your family, neighbors, friends, and pets.

As a homeowner, you may put up a free advert in a housesitter listing. Many websites may have an auto e-mail service that notifies you every time a brand new housesitter registers in your neighborhood.

Before a housesitting deal gets started, the matching will clarify the owner’s needs and the housesitters requests like:

– duration of the housesitting
– hat happens in case of delayed return of the owner
– obligations to do
– number of guests allowed
– Expectations for cleaning, pet, plants, and garden
– Regulations in case of illness or emergency. The owner should provide a local contact

Also, there are several insurances that one can buy before- for homeowners and housesitters. In case something of value should break, or an emergency occurs.

Be far away from home with a peaceful mind!

Housesitters wanted!

Apply to become a housesitter, check out reports from experienced housesitters and save money.
Thousands of house owners are looking for reliable housesitters to stay in their properties.
Discover limitless opportunities by registering as a homeowner or housesitter with

housecarers menu


The cash you save, you can spend during your stay and sometimes you can earn some extra money for offering additional services.

Entry right here for further information and free registration:



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