Value-Added Tax

Many European countries are expensive in part because of value-added tax, which is like a super-hefty sales tax and averages about 17 percent. If you are buying something expensive and leaving the country afterward, you can often get some of this tax refunded (many countries require a sizeable minimum purchase before you qualify for the refund). But, if you do make a major purchase, this can save big bucks, and can also make something that you couldn’t afford without the refund fit into your budget.

The procedures for doing this are usually complicated, and should be explained by a tourist office or at a more upscale store. Look for the blue-and-red or blue-and-silver signs that say “Tax Free for Tourists” - these places can give you a check for the amount of tax you have paid on the spot, and this can usually be cashed at the airport or sent in after you get home. If you wait until you get home, don’t count on getting your refund right away.

Wiring Money

In case of disaster, you might be able to have money “wired” from home in a matter of hours, if you’re in a big town or city. Wiring money is simple - someone hands over a wad of cash or a credit card in one office, the company takes a whopping fee, and you get the remainder paid to you in another company office. The fees for doing so are outrageous - as much as five to ten percent, for what amounts, in this modern age, to a phone call.

Western Union is the most famous company that offers this service. Their number in the US and Canada is ©1-800/325-6000. If Western Union can’t help you, try Moneygram at ©1-800/926-9400, which offers a similar service at similar fees. They might serve locations that Western Union can’t, and vice versa.

The State Department Citizens Center for Emergency Services may also be able to help Americans get money while abroad or help out in an emergency. Be advised, however, that this office provided me with the worst phone service of any organization I contacted in writing this book. The most incompetent of the tourist offices I spoke with was light years ahead of the State Department of the United States of America in terms of professionalism and service. How sad. Their number, for what it’s worth, is ©202/647-5225. Other nationalities should contact their embassies and hope for the best.

Cash

Money talks, in no uncertain terms, with no accent, in the local language, everywhere in the world. Always keep at least some of this wonderful stuff on hand. Generations of travelers have been frightened into thinking that carrying cash while traveling is something evil by years of American Express commercials. Nonsense. Carry some cash beyond your daily needs, but don’t carry too much. How much is too much? I guess the answer to that is another question: how much can you afford to lose? Changing anything much below a hundred dollars at a time, though, will force you to the bank or ATM machine endlessly, and make you spend a great deal more in commissions than you need to.

Also, a hundred-dollar bill, or the equivalent in local currency, stuck in a jacket lining or someplace else where you will not use it day-to-day can come in very handy, and not just in case of disaster. Public holidays, late arrivals, and/or incompatible ATMs can all cause inconvenience. Cash-in-hand is the universal inconvenience remover.

ATM cards

One of the most beautiful short train journeys in the world is the Flam railway in Norway, which winds off a main rail line down a canyon to the tiny town of Flam, which sits at the head of one of the most majestic fjords in Norway. After rattling past waterfalls, massive granite cliffs, and little postcard farms, the train let me off near the ferry landing in Flam. Near the dock was a little glassed-in hut with a foot of grass growing off its roof. Inside the hut was an ATM. Out of curiosity I walked in, stuck in my card, and walked out one minute later with a couple of hundred Norwegian crowns which would later be debited from my checking account back in Florida, at an exchange rate better than any I had seen in Norway. Needless to say, ATMs can be pretty darn convenient; in fact, they’re my primary means of obtaining money while in Europe. Some tips on ATMs:

- Check that your current card, or a new one you obtain for your trip, is connected to systems worldwide. Obviously this is essential. Connecting your card to the Cirrus or Plus system, or both, is a good start.

- Try to get a card from your bank that does not have a transaction fee. Almost all credit cards can also be used as a debit card but wil] charge a hefty fee or percentage when you use it as such.

Travelers’ Checks

In my opinion, travelers’ checks are damn near obsolete, a holdover from the time before electronic banking. Back then it was impossible for banks to efficiently communicate information about the validity of a person’s personal check across continents. Since nobody wanted to carry big wads of cash, travelers’ check companies could sell their guaranteed checks as a kind of universal currency. Well, we don’t use rotary phones and typewriters very much anymore, and that’s how I feel about travelers’ checks. It is far simpler and more convenient to walk up to an ATM and pull out a few hundred bucks in local currency than it is to find someone willing to cash a travelers’ check for a fee. Travelers’ checks also have the drawback that you pay a commission twice: once when you buy them, and then again when you cash them - though this may be avoidable (see below). In any case, ATMs are sprouting up everywhere, even in small towns.

The one good thing about travelers7 checks is that they can be replaced if lost or stolen, although this is not nearly as fast, simple, or easy as commonly believed. Generally, you will need the serial numbers of the checks that were lost/stolen, and the date and place of purchase. If you do get travelers’ checks, keep at least one list with you (separate from the checks, of course) and keep another list at home in an obvious spot. Study the refund procedures for your specific company very thoroughly before leaving, as they can sometimes be complicated. You can’t just pick up a phone, say “I lost my checks,” and expect replacements to be delivered to you in an hour. No way.

Changing Money

When changing money you will lose value in any one of four different ways:

- With a percentage of the total amount changed.

- With a flat fee.

- With a minimum fee.

- With the exchange rate itself.

Here’s an example:
Bank A is offering a rate of 1.6 Swiss francs per dollar, with a 3-franc minimum fee or a 1-percent commission.Bank B is offering a rate of 1.65 Swiss francs per dollar, with a 2-percent commission or a 1-franc minimum fee. Which is the better deal for changing USD 50?

Changing Money

When changing money you will lose value in any one of four different ways:

- With a percentage of the total amount changed.

- With a flat fee.

- With a minimum fee.

- With the exchange rate itself.

Here’s an example:
Bank A is offering a rate of 1.6 Swiss francs per dollar, with a 3-franc minimum fee or a 1-percent commission.Bank B is offering a rate of 1.65 Swiss francs per dollar, with a 2-percent commission or a 1-franc minimum fee. Which is the better deal for changing USD 50?

Money Matters

There are three perennial issues concerning money while traveling in Europe: how much do I need, in what form should 1 carry it, and how can I best exchange the different currencies still used in Europe? These three subjects, and particularly the last two, can cause no end of headaches and extra expense. For example, if the first place you trade money is in a hotel and you get into the habit of doing so, it will cost you big, big bucks by the end of your trip. “How much should I take?” was dealt with in Chapter 2, “Budgeting"; now it’s time to fight it out with the other two issues.