The Ecphorizer

The Incredible Shrinking Dollar
David Koblick

Issue #13 (September 1982)

How to get the most for your dollar when buying francs, marks, lira, etc.

Tomato paste, indeed! I struggled for an hour trying to paste a sliced tomato back together with that stuff. Fruitlessly, if you'll pardon the expression. Boy, what a hype! Take my advice, steer clear of phoney products like that. Ditto for almond paste.

But seriously (honest), can begin to understand why money changing is Big Business in Europe.

there's a subject I do know something about: Pfennig-pinching in Europe. And I'm gonna share this knowledge with readers of THE ECPHORIZER.

[quoteright]By the time you read this, summer will be interfacing with fall. But that's the best time to travel to and in Europe. The crowds are gone, the kids are back in school, and tourists can pace themselves more leisurely.

The advice I give is chiefly for anyone (or two) traveling independently, not spoon-fed on a package, or guided, tour. How it's utilized will depend on how long you're going to spend abroad, how many countries you intend to visit, whether you're traveling solo or duo, and how much money you've budgeted for the trip.

So let's set up a hypothetical "for instance," and you can modify the advice to suit your own situation. Say you're traveling alone, you'll be in Europe about six weeks, you've already bought a Eurailpass, and after paying for your flight you have $2000 left for bed and board and walking-around money.

Some travelers plan on having money transferred to them in Europe by phone or cable. Don't do it - this method is complicated and timewasting, especially if you're not sure where you'll be when. You might find yourself hanging around somewhere for an extra unplanned week, waiting for a bank draft to arrive.

Do as most travelers do, and take almost all your money in US dollar traveler's checks. The rest of this paragraph cannot be repeated too emphatically: Keep the slip listing your check numbers someplace other than where you keep your checks, like in your suitcase. Should the checks be lost or stolen, they'll he replaced immediately -- IF you have the numbers, and if you can state about how many checks you'd already cashed. If you're not sure of that number, better to underestimate. If a few checks you'd claimed as stolen turn up later with your identifiable signature on them, you can square it up with the issuing agency after your return. Don't call them, they'll call you. But let's hope that this eventuality never arises.

Get mostly larger denominations. Say 5 hundreds, 20 fifties, and 10 twenties. That comes to $1700. Then another couple hundred in bills: 5 twenties, 5 tens, 8 fives, and 10 ones. Another $100 check, if you still have a hundred left.

Here's the logic behind this advice: These checks (unless you've gotten them free from triple-A or from the friendly savings-and-loan where you keep an account) have already cost you 1% of their face value (a genuine swindle - the issuer will be collecting interest on the cash you paid him, until the checks clear -- he should be paying you 1% for buying them). Every time you cash one you lose an additional one to five percent, either from an unfavorable exchange rate or service charges or both. Rate skimming can be minimized by cashing checks at banks or at offices of the agencies that issued them, like Cook's or American Express (ask for an international address list when you buy your checks). Sometimes banks are closed just when you need money, but Cook's and Amex are open after banking hours and on Saturdays. Exchange offices at major-city rail stations are open elsewhen, often around the clock, but their charges are usually exorbitant.

Never, never cash checks at your hotel, nor at a store unless they offer a good discount on purchases bought with checks rather than with cash. Which some stores do, notably in Paris.

Cook's and Amex will charge you the same fee and/or service charge that the banks do, even when it's their very own bloody checks they're cashing. They explain that it's the law, a law to protect the poor banks from unfair competition. If you see the logic in this, please explain it to me. This fee is often a flat rate per transaction, regardless of amount. When cashing larger checks, that's usually the best deal. Another fee is a small percentage of the amount changed. One Austrian bank I know charges 3/4 of 1%, but another bank down the street charges 1-1/4%. This system is less favorable than the per-transaction fee, especially when it's accompanied, as it often is, by an additional smaller fee called costs, charges, expenses, cartage or some other euphemism for "padding."

But the exchange system which really bleeds the traveler, particularly the innocent who buys all his checks in small denominations, is the one that charges you per check This can run up to a dollar each (often with a small transaction charge added), which is only 1% for a $100 check, but a whopping 5% for a twenty. And at the Frankfurt Hauptbahnhof you'll pay the minimum 3-mark fee, about $1.25 at this writing, to cash even a $10 check. On a happier note, if you cash VISA checks issued by Barclays Bank at any Barclays branch in London, they'll give you the straight dollars-to-sterling rate without charging a fee.  Be sure to point out to the teller that the checks are Barclays Bank issue.

All the foregoing isn't just an exercise in petty nickel-nursing. Your $2000 will be worth only $1960 under the best of circumstances. Under the worst it will have shrunk to $1880. So that's about eighty bucks more to spend, if you're cagy.

Estimate about how long you intend to stay in each country and about how much that stay will cost you (simple arithmetic -- like $2000 divided by 40 days in Europe = $50 per day), and when you arrive exchange some rounded-off amount a little less than your estimate. The last day or so, if you're almost tapped, exchange one of your $20 checks, or one or two of the smaller greenbacks. That way you won't find yourself crossing a border holding a stack of currency of the country you're leaving. And don't think, "Well, I'll just change my pounds into francs." It's already cost you 2 to 4 percent to get those pounds; you'll lose a like amount exchanging them for francs. Now one can begin to understand why money-changing is Big Business in Europe. Not only in Europe, it's Big Business everywhere in the world. And the money-changers flocked right back to the Temple as soon as Jesus was out of sight. The Banca Cattolica, with branches in every town in Italy, must be owned by the Holy See. I saw priests and nuns behind the wickets, and the teller who exchanged my dollar traveler's checks for lire was a nun. Look for one of their branches when you're in Italy -- their exchange rates are no better nor worse than those of other banks.

In spite of everything I've said, it should be emphasized that one ought not to make a practice of analyzing every transaction and exchange with misgiving. That would certainly detract from the enjoyment of being in Europe. Just stow all the above information in your occipital lobe (all Mensans have one), and try to follow the guidelines as nearly as feasible. Enjoy yourself, but shop around a little, and always count your change.

Damn! How come a guy with my perspicacity gets taken so easily? I just looked at the label of the poundcake I bought this morning. Only 14 ounces! Tomato-pasted and short-weighted both on the same day. I'm gonna write my senator. 

Koblick has moved to Steyr, Austria, where he supports himself with free-lance writing and translating.

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