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Cash:

Cash is the most versatile method there is. Virtually everywhere takes cash. The one exception is that some car rentals may not rent you a car or ask for a very large deposit if you don't have a credit card.

In some countries you may be able to get by entirely with American money or other local generally accepted currency. However, this will often be at a huge expense as the exchange rate offered by merchants and hotels is usually not very good. (Can be as much as 15% or even more). Be sure to bring only paper money in good condition. Banks cannot easily or cheaply exchange worn-out foreign currency for replacement as they can with their country's own currency. Worn paper currency may be devalued if it is accepted at all.

This biggest disadvantage to cash is the risk. If you lose it you can't get it back, and if someone finds out you have a large wad of cash you become a potential mark.

Money exchange is a very complicated business. All money exchanges work on the basis of selling a foreign currency at one rate and buying at another, with the difference being the spread. Newspapers usually will quote the average of the two as the daily rate. Where there is more competition, the rates are likely to be better.

Currency exchanges are not all created equal. Where the best rates are available varies tremendously from one country to another and from one currency to another. In some cases it may be better to exchange your money before you leave, in others it may be better to do it in your destination. Rarely is the most convenient location (such as at airports, or major hotels) the best rate available. In some cases it can be significantly higher.

As you loose some money on every currency exchange it is important never to exchange too much money. It is usually a good idea to make sure you spend most of the cash you have. Therefore, if you have a large chunk of cash left over at the end of your trip and you were planning on paying for your hotel or car rental with credit card, pay for some of it with cash to get rid of the currency.

If you are exchanging very large amounts of money it may be possible to do a certified cheque currency exchange. This is sometimes offered at a cheaper rate at currency exchange. You bring in a certified cheque to a currency exchange and they give you a certified cheque made out to you in the new currency.

Most major currencies are subject to counterfeit these days. It is a very good idea to study the bills of the currency of the foreign country to become familiar with how it is supposed to look and feel. Almost all currencies employ anti-counterfeit technologies. This can be colour shifting ink, watermarks, special threads, iridescent inks, raised printing, holograms and other features. Become familiar with them so that you can quickly check them when you get a new bill whether it is as change or from a money exchange. If you are unsure, don't be afraid to say you would rather get a different bill, or just say you would rather get 2 smaller bills for change (As an example if you get a ten in change that you don't like the look of, ask for two fives instead). If you end up with a counterfeit you wont get compensated, and you may end up having to explain it to the police.

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