RTW trip prep: Buy currency now or later?
February 26, 2016 6:57 PM Subscribe
My plan is to embark on a year-long round-the-world trip at the end of year (roughly Dec 2016), but I'm having difficulty in deciding how to fund the trip amidst fluctuations in the benchmark currencies. As an expat living in Korea, I'm wondering which currency I should exchange for.
The Korean won has suffered terribly this year and especially the last few months. The most recent rates peg the won over 1240/USD. Reports predict an even gloomier outlook for the second half of the year (when I plan to depart) with experts guessing the rate will jump to 1300/USD. In spite of this, I'm wondering if I should go ahead and purchase the won now.
A friend of mine suggested buying euro instead since the currency has also taken a heavy hit during these times. I do plan on spending a couple months traveling through Europe.
Finally, between my US and Korean credit cards, which would be better to use abroad for large purchases (e.g. flights and hotels)?
Thanks very much.
The Korean won has suffered terribly this year and especially the last few months. The most recent rates peg the won over 1240/USD. Reports predict an even gloomier outlook for the second half of the year (when I plan to depart) with experts guessing the rate will jump to 1300/USD. In spite of this, I'm wondering if I should go ahead and purchase the won now.
A friend of mine suggested buying euro instead since the currency has also taken a heavy hit during these times. I do plan on spending a couple months traveling through Europe.
Finally, between my US and Korean credit cards, which would be better to use abroad for large purchases (e.g. flights and hotels)?
Thanks very much.
If it were me, for safety and simplicity I would just use a credit card when possible and get cash at ATMs when necessary.
posted by Night_owl at 5:01 AM on February 27, 2016 [2 favorites]
posted by Night_owl at 5:01 AM on February 27, 2016 [2 favorites]
Before I set off on my multimonth long traveling, I just transferred everything to my US bank account from my Hong Kong one. My US credit and debit cards had fewer fees when it came to international purchases and ATM withdrawals. I used a Bank of America travel rewards one that didn't charge extra for international purchases. I think I accumulated enough points on that thing by the end of the trip to get a flight from Australia back to Hong Kong. The guy I was traveling with was also an American expat in Korea, and he found it more advantageous to use his US cards too.
You really don't want to exchange money now and have huge wads of cash that you'll need to exchange again to the local currency if you don't start your trip in Europe.
posted by astapasta24 at 6:04 AM on February 27, 2016 [1 favorite]
You really don't want to exchange money now and have huge wads of cash that you'll need to exchange again to the local currency if you don't start your trip in Europe.
posted by astapasta24 at 6:04 AM on February 27, 2016 [1 favorite]
Another thing to consider is how the cards you plan to carry handle fraudulent charges. I once had a debit card stolen in Europe and my U.S. credit union was great about reversing charges and FedExing me a new card ASAP. This is fairly standard in the U.S. but I'd still check to make sure as well as making sure your Korean credit card companies behave similarly if you decide to take them along.
posted by tiger tiger at 6:17 AM on February 27, 2016 [1 favorite]
posted by tiger tiger at 6:17 AM on February 27, 2016 [1 favorite]
I lived for a few years in Turkey, which saw a massive devaluation of its currency while I was there. After my first year of living there, I realized I had effectively lost a couple thousand dollars from savings because I hadn't been paying attention, and quickly switched my savings to EUR and USD denominated accounts (which was offered by most Turkish banks). If you have the opportunity to do that with a Korean bank, I would suggest it -- that way, you'll know exactly how much money you're travelling with, and won't find out in your 10th month of travel that you lost a month or two's travel funds due to exchange rates. If your Korean cards are Visa or Mastercard, using them should be no different than using a US card.
posted by Theiform at 6:41 AM on February 27, 2016
posted by Theiform at 6:41 AM on February 27, 2016
If you could predict exchange fluctuations you be rich and wouldn't be worrying about exchange fluctuations.
posted by humboldt32 at 7:45 AM on February 27, 2016 [1 favorite]
posted by humboldt32 at 7:45 AM on February 27, 2016 [1 favorite]
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You don't want to be carrying a lot of cash, so Euros aren't practical unless you already have a Euro-denominated account or can open one very easily.
As far as credit cards, you want to get one that doesn't charge an extra percentage on top of the currency exchange. I would recommend using one from wherever your money is now - no point in exchanging money twice. You should also consider how you'll be getting money out of ATMs: you want a method that minimizes fees.
posted by ssg at 10:30 PM on February 26, 2016