Euro - Dollar Exchange Rate Update - Dollar Costs in Europe rise 30% in Two years!

CASH ADVANCES ON CREDIT CARDS: IMPORTANT: For many reasons outlined below you get the best exchange rates using credit/debit cards. However credit cards should be primarily used for purchases, such as hotels, restaurants, and shops. Cash advances from credit cards have high transaction fees.

When I make statements about the way credit card companies and banks charge their various fees, I am speaking generally. My credit card has somewhat high cash advance fees of 3.5% plus they begin charging interest on the money immediately.

As far as money goes, I think the best way to go, if possible, is with a credit or debit card with the Visa or Mastercard logo. I also discuss attempting to use ATM cards, traveller's checks, and cash.

Credit cards are great if you don't have the money before your vacation. You get all purchases at the best exchange rate and pay only a slightly usurious fee plus interest to get at cash. Debit cards are best at getting cash and paying for things you already have the money for.

With either, you may only pay a small exchange fee (check with your issuer) and get the best exchange rate, as Mastercard/Visa certainly has better exchange rates than you can personally get from money changers there. The big credit card transaction companies hold back the actual exchange time of the transaction and build up pools of transactions before executing them. They wait for the best exchange rate, and then push them all through. Hopefully some of this benefit is passed on to you.

Also, with credit cards and debit cards you don't have to carry a lot of cash or TRAVELLER'S CHECKS

TRAVELLER'S CHECKS: The problem with traveller's checks is that if you lose them, for immediate practical purposes, it's like losing cash. While it may be possible to get replacements, at the least it will still suck to lose them in the first place. Europeans are famous for not working on the weekends. If you carry traveller's checks, treat them like cash and be sure you know the telephone numbers and locations of people who can get you replacements.

ATM CARDS before 2000: I used to say, "These work somewhat erratically in Europe. The last time I checked, in 1998, coverage was still spotty. Having a well recognized American network name like Cirrus or Star means little in Europe. VISA and MASTERCARD are much more common than your local bank." There is a concern that your PIN number must be exactly four digits or it may not work.

ATM CARDS NOW: As of 2001, the ING Bank ATM's, ABN-AMRO Geldautomaat ATMs and the Postbank Giromaat's almost all handle both VISA and MASTERCARD. They also feature an expanded selection of ATM networks like Star and Cirrus, though coverage for these is not complete.

DEBIT CARDS: To get cash, go to an ATM machine that matches your VISA or MASTERCARD (Maestro) card. Most ATM's do both.

As you probably know, a debit card can be used to access funds in a checking account, but works like a credit card carrying the VISA or Mastercard title. The additional bonus is that if you do run out of money and need more from a friend or relative at home, all they have to do is deposit the money in your US account, and the money becomes available at most ATM's virtually immediately.

CREDIT CARDS: The best way to go, especially if you can pay off the debt for purchases before the card starts to charge you interest. You get the best deal this way.

Here we tend to think of VISA and Mastercard as synonymous, but from my experience in Europe, some ATMs take VISA and others Mastercard, in about equal amounts. Best to carry both if you are plastic-oriented, then know where to get cash. You can always get cash at airports and most train stations.

As for cash, traveler's checks, etc, you will lose up to 3-5% in the exchange process compared to using plastic. My best suggestion is that when you are in the US airport, if you have time, go change $50 into guilders, so you have some local currency for a $30 cab ride from the airport into Amsterdam, or to buy train tickets for the trip if your luggage is manageable.

Then when you are in Holland go as far away from the touristy areas and change your money. Often the hotel will offer this service, at a higher rate. The money changing place in the train station may offer OK rates, but I personally don't like to flash money around at Amsterdam Central Station -- you will see what I mean when you go there. Lots of heroin junkies and people trying to sell coke.