Prague Travel Blog & Tips by King Wenceslas
News, travel tips and advices for accommodation in Prague and other Czech towns.

The importance of a travel budget

Preparing for that first trip to another country is not easy, especially if you make all the arrangements yourself. Most people start with booking flights, reserving rooms and studying restaurant choices. Every traveler has a travel budget, so the trick is to develop a travel strategy that is within budget, so you don’t spend the next three years paying for the trip. When you start to organize your travel budget, the first step is to do a little research on the currency exchange market. If you’re traveling to Prague in the Czech Republic for example, and you have British Pounds you want to exchange for Korunas, get on the Internet and see how much one Pound is worth in Korunas and base your budget on Korunas, not Pounds.

In order to do that you’ll need a currency exchange strategy that will give the maximum number of Korunas for every Pound you exchange. There are all kinds of currency exchange merchants waiting to exchange money for you, but unless you have done your homework, you may end up giving them a hefty chunk of your travel budget in transaction fees, surcharges and inflated exchange rates. There’s only one way to develop an effective travel budget and that’s through a professional currency exchange broker. If you use a broker while you’re planning the trip, your budget will be more realistic and easier to use.

Why should I use a broker instead of a bank?

Travelers usually think of banks first when they want to exchange money and that’s their first budget mistake. Banks exchange currency for a nice profit; they add a transaction fee to every exchange, plus they usually don’t use a real time rate. Part of their profit is in the exchange rate. Credit card companies even cost you more money. If you use a credit card, your budget can be worthless. Credit card companies add a surcharge to every travel purchase, charge excessive fees, and they use an inflated exchange rate. If you must use a card on the trip, use your ATM card; the fees are less, they don’t charge a surcharge and the exchange rate is usually better.

Forget about airport merchants and hotels

If you want to stay on budget, close your eyes when you walk pass an airport exchange merchant. They pay high rent for the exposure, and they want you to help pay part of that rent. Hotels know you love the convenience of exchanging money with them and they make you pay for that luxury. Hotel transaction fees can run as much as 10%, plus they use an inflated rate. When you use a professional broker while you’re planning the trip you can average your exchanges, so you know exactly what each exchange costs. You’ll know how many Korunas you have to spend in Prague. A broker does make money on your exchanges, but saves you money in fees. There are no purchase surcharges and you exchange money using a real time exchange rate.

Other travel tips

Some countries limit the amount of cash you can carry through customs, so check with your broker and stay within the limit. Always carry cash in a leg pouch, hidden pocket or money belt that’s secure and out of sight and use hotel safes when you reach your destination. Follow local security tips and remember common sense is your best security defense when you use it.

With so many factors influencing a currency’s value it’s important to save as much money as you can before a trip overseas. ForexTraders.com provided this article to help you maximize your budget and to learn more about currency and forex trading, make sure to visit the site.