Dollars or Pesos?

November 1, 2005 5:28 AM

My wife and I are planning a 25th anniversary trip near Yelapa, Mexico, and are in need of some advice on how to handle cash transactions...

This is our first time out of the U.S., so we are unsure how to handle cash in Mexico. We have been told by many people that the dollar spends just as well as the peso will. So, does that mean that merchants will provide prices in dollars, or will we be expected to make the conversion on the fly? I assume change would be made in pesos, yes?
Or should we just go ahead and exchange some dollars for pesos and be done with it? If we go that route, where is the best place to exchange?


Sorry if this sounds simplistic to the better-traveled me-fites but, as a lifelong landlocked midwesterner, these questions perplex me.

posted by Thorzdad to travel & transportation around Tepic, Mexico (12 answers total)

Just get some pesos. It's just easiest to work in the native currency. And merchants provided prices in dollars and pesos are understandably going to round up, so using pesos gets you the better deal. Besides, you're on vacation in a different country...relax and go with their food/money/schedule!

You can use your ATM card to withdraw pesos -- all you'll pay is the regular transaction fee that your bank charges for withdrawls from other ATMs. Buy some pesos to get you started either at your local bank/AMEX office/Mexican consulate or at the airport in Mexico.
posted by desuetude at 5:39 AM on November 1, 2005

Dollars will likely be more welcome than pesos, especially in tourist areas. While prices may not be posted in dollars in all places, everyone will be willing to tell you what the price is in dollars. If you have an eye to what the actual exchange rate on dollars to pesos is, you can sometimes save money by using actual pesos, and sometimes you'll lose it. Most heavily tourist places will provide change in dollars, some less touristy places will provide it in pesos.
posted by jacquilynne at 5:44 AM on November 1, 2005

Foreign countries have their own currency. Trying to exchange your green funny money for goods and services may work in places filled with tourists from your country, however, the exchange rate you get will be intentionally terrible to compensate the locals for the hassle involved. The message you're sending is "I can't be bothered to even deal with your quaint local customs, so please mark up everything as much as possible because I'm an ignorant tourist who'll be leaving soon so there's no prospect of repeat business from me."

Take your ATM card. In Mexico, withdraw cash from the ATM. If you end up with extra pesos, buy gifts before you leave.
posted by jellicle at 5:52 AM on November 1, 2005

Thanks for the quick response!
We won't be staying in a "tourist" area, so that may knock out the idea of using dollars. Similarly, I don't think there's an ATM anywhere near where we will be.
posted by Thorzdad at 5:58 AM on November 1, 2005

Foreign countries have their own currency.

That is rather simplistic advice, when there are actual places that prefer dollars to their local currency.
posted by smackfu at 6:08 AM on November 1, 2005

Do not exchange dollars for pesos in the airports since most of the time they have lower exchange rates than most banks do. Go to the banks in the area where you will be staying and see what their exchange rate is. Personally, I use Banamex.
posted by Number27 at 6:10 AM on November 1, 2005

There is no ATM in Yelapa - suggest you read the whole article.
posted by andrew cooke at 6:11 AM on November 1, 2005

I think, for Yelapa, you should probably take a couple days' worth of pesos and then traveller's checks (check with your hotel and see if, barring anywhere else, they will cash them - sometimes they don't keep enough cash on hand to do more than change about $20). You can take a stack of $1 bills in case you find yourself low on pesos, for tips and small purchases, but if there's nowhere nearby for you to change money, there's not going to be anywhere for them to change it either.

You can search for Banomex ATMs and see if there will be one anywhere within your reach. It really is the easiest way. I assume you'll be coming in through an airport, and you should be able to hit an ATM there, at least.
posted by Lyn Never at 6:15 AM on November 1, 2005

That is rather simplistic advice, when there are actual places that prefer dollars to their local currency.

Mexico ain't one of them- that rule is typically only true in countries where the native currency is near-worthless. The airport will have an ATM. You'll ALWAYS get a better exchange rate at an ATM than ANY exchange service.
posted by mkultra at 6:18 AM on November 1, 2005

It's always worth spending a bit of time familiarizing yourself with a new currency and noting bill colours/values as well as coin shapes/material/values. Thanks to the magic of the internet, here is what Mexican bills look like as well as what coins look like.

The Mexican peso should be quite easy for you to use as it converts to US dollars in--roughly--multiples of ten. One peso is worth approximately US$0.10 (and, conversely, US$1 is worth 10 pesos). It may sound cheesy, but practice converting back and forth (from dollars to pesos) before you go. If you're at, say, the grocery store, figure out the prices in pesos (my mom finds this quite helpful!).

I would agree with previous posters - your money will go further if you spend pesos rather than dollars. Additionally, by paying or tipping in pesos you will be saving someone else (who is less likely to be able to afford it) the hassle and expense of converting money.

Definetly withdraw pesos from an ATM at the airport (since Yelapa doesn't have an ATM). It can't hurt to bring some traveller's cheques, as well.
posted by lumiere at 8:43 AM on November 1, 2005

You'll ALWAYS get a better exchange rate at an ATM than ANY exchange service.

This is not strictly true. Some countries (like Venezuela) allow banks to put a fee on inbound international transactions. Many US Banks charge a fee for outbound international transactions (this is a recent change). These can add to as much as 10% to your transaction, but if you can walk into the bank with cash or a TC, you'll get the same rate with no fees.

In areas with a black/grey market for currency exchange (anywhere with a soft currency, really), the legitimate cambios will offer a rate higher than the banks, but lower than the hucksters on the street.

With Regard to Mexico, use pesos whenever possible. You'll be able to exchange dollars to pesos at a rate close to 11 pesos per dollar, if you go to a bank or cambio. If you buy with dollars at local merchants, they'll almost always convert 10 to 1, as the math is easier (and most gringos ricos with dinero verde don't care/notice).

Call your bank and ask about the ATM fees for international transactions and/or foreign-currency transaction. If they're free or cheap, then use Mexican ATMs to get pesos. While you've got them on the phone, ask if they can sell you pesos while you're still in the US (most banks will, some may need a day or two warning).
posted by toxic at 10:07 AM on November 1, 2005

Get pesos.

I don't think you'll have any trouble paying with dollars, but as toxic said, you'll get an exchange rate of 10 to 1 instead of almost 11 to 1. Any change you get will be in pesos, since nobody accepts American coins, not even banks.

I also recommend getting pesos at an airport ATM; those are most likely to have an English language option.
posted by Penks at 11:11 AM on November 1, 2005