Let me try to explain the logic of bringing relatively large amounts of cash. If my hotel is costing me 300EUR per night for say six nights, that's 1800EUR. I'm going to be using GBP as my base currency. Supposing I buy when the rate is favourable - typically at 1.45EUR per 1GBP - then my hotel bill has come to 1241GBP (rounded), now if I happened to travel and the rate dropped to 1.41EUR per pound and I had to pay for it on credit/debit card the bill would now be 1277GBP. By taking cash I've saved myself 36GBP. Whilst this is an insignificant amount, it pays for a couple of cocktails, a light lunch, taxi etcetera etcetera. For minimal risk - what's the chance of being a victim of crime coming out of an airport into a taxis straight to an hotel - you've saved some money. The more you spend the more you save!

"The more you spend the more you save!" - M-Kingdom, you already think American, congratulations!

My dear, I knew there must be some side-effects to my visits here!

On our next trip to France and the UK, planned for late fall, my wife and I will take 25 GBP, 50 Euros and about $100. No TCs. The GBP and Euros are remaindered from prior trips. We are comfortable arriving anywhere without the local currency.

Each of us carries an ATM card on different accounts, and at least one credit card each, again different. We have never had more than a momentary delay in getting the appropriate currency.

Before the Euro you needed 5 or 6 different currencies when touring. The ubiquitous ATM has made travelling simple.

I take $100 in new 20's, about $100 in Euros - or whatever the local currency is. If I don;t have the latter left over I buy in the outgoing ariport. I charge everything possible and use my ATM card to get cash every 4 or 5 days - and usually end up going home with the same $100 and some local currency (that I save for the next trip). No Trav Cheques - they're way too expensive and very hard to change.

Just read m_kingdom2's most recent post and it is assinine. The assumption is that the conversion is always going to be in his favor. Even George Soros wouldn't make that bet.

Whatever I have left from my previous trip, but usually around 50 Euros. And airport dinner/parking dollars. That's it. I get cash as I need it from an ATM machine and charge everything I can because I get a better exchange rate that way. Haven't used traveler's checks since I couldn't get them "cashed" years ago without an exhorbitant fee.

I think what this thread may be showing is people's normal style of dealing with money. I am a cash & ATM person at home and only use credit cards for major purchases. Same when I travel. I'm guessing others might be simply continuing something similar to their home practices abroad.

As a side note several people mentioned "we", my husband, etc. When you are two people together you have the automatic advantage of a backup way to get/carry cash. Because I often travel solo I need to be sure whatever I have will get take care of my own needs in any circumstance.

At home I always use a black MasterCard my sole credit card, I have no need for any others - I rarely use cash, only for tips, antique shops or small purchases.

m kingdom - you will happily pay €300 a night for a hotel, but are worried about losing £36 if the exchange drops?? I hate to think how much it must eat you up if the rate happens to rise whilst you're away and you lose a few quid that way.

BTW, I don't have a black Mastercard, just a common blue one, but I was recently the victim of credit card fraud following a trip to Malaysia. My card apparently was cloned and used for 2 large transactions some weeks later in Korea. However, my bank, Nat West, were alerted to these unusual transactions, phoned me to query them the same day and it didn't cost me a penny. Maybe you should change banks if you're so worried about fraud.

jsmith is right. m_kingdom2's strategy only locks in the exchange rate - it is not economically superior to using credit cards. There is just as much chance the exchange rate will move in one's favor as there is that it will move against. And actually, when you factor in the (small) float that m_kingdom2 is giving up by not having that cash invested, he/she is economically worse off (albeit by a fairly insignificant amount).

But the certainty of the exchange rate is often attractive to people.

m kingdom, my, you must be packing quite a wad (of money) in your pants!

My dear, In the UK the exchange rate for EUR last year averaged 1.41-1.42, this year is is not 1.44-1.45. It won't go up to 1.46-1.49 range so I buy in this year. As for saving 30 or so GBP, as I said it's a couple of cocktails, it's something so why not have that "something"?

As for fraud, I'm not in the least bit concerned, but I'd much rather have my holiday already paid for up front than face a bill on my return. I have the cash in my safe so it's already paid for up front. Furthermore, if I'm away for a couple of weeks, I could easily spend 6000EUR that's a differntial of around 100GBP so a bottle of Krug could be lost.

Sorry mk, I must have misinterpreted your phrase "using cards to pay for items leaves one open to fraud" Silly me.

Suze is correct. I don't use ATMs at home and the one time I did in Europe, did not work for me. I bring euros because alot of the places we stay or eat do not take credit cards and we don't stay in large cities so we waste little time looking for atms and banks. But Everyone's way is ok for them.

I use that in the same sense as saying "smoking gives you cancer" only 30 per cent of smokers develop cancer associated with their habit, so that phrase should read "smoking can lead to a significant increase in your chances of developing cancer".

My sentence should read "credit cards seriously increase your chance of being a victim of credit card fraud".

Quite true.

Similarly, carrying around significant amounts of cash increases your risk of losing significant amounts of cash.

On our last trip we took 300 Euros. Used ATM card to get additional cash. We charge the hotel and pay cash for everything else. Not uncommon to have at least one hotel (B&B, Guest House etc) that requires cash.

You choose your method, you take your chances. I have never lost or been robbed of cash while traveling. To me that seems less likely than running into an ATM malfunction or credit card scam.

MK2, please get your facts straight before you brag about your expenditures and financial wizardry so you retain at least a modicum of credibility.

On average in 2003 the pound bought 1.44615 Euros (range was 1.5456-1.3776) and in 2004 it is 1.48569 (range 1.5279-1.4096). ON AVERAGE THE EURO IS 2.7% LESS IN 2004 THAN 2003. The source for this is http://oanda.com/.

I don't know what interest is paid on riskfree deposits in the UK but I can get 2% FDIC insured in the US. How much did you earn on those funds in your safe?