How much cash should you carry?
Cash is used for everyday expenses while traveling more often than most people expect, even in destinations with strong card infrastructure. A reasonable rule of thumb is to carry enough local currency to cover two to three days of expenses, including transport, tips, and small purchases, then top up as needed via ATM rather than carrying large sums at once.
The exact amount depends heavily on the destination. In cash-first countries like Japan, Germany, or much of Southeast Asia and Africa, you'll want a larger buffer, since many restaurants, markets, and local transport options simply don't accept cards. In highly cashless countries like Sweden or Norway, you can comfortably carry very little.
Where to exchange currency
The best rates almost always come from withdrawing local currency directly from a bank-branded ATM after arrival, rather than exchanging cash beforehand. Bank ATMs typically use the real interbank exchange rate plus a small, transparent fee, whereas currency exchange counters build a hidden margin into their rate that can amount to a 5-10% loss.
If you do need to exchange physical cash, look for licensed exchange bureaus in city centers rather than tourist hotspots, and always compare the buy/sell rate against the current market rate before exchanging.
Airport exchange vs ATM withdrawals
Airport currency exchange counters consistently offer the worst rates of any option, often 10-15% worse than a bank ATM, because they rely on a captive audience with limited alternatives. If you must get local currency immediately on arrival, withdraw only a small amount from an airport ATM to cover transport into the city, then use a proper bank ATM once you're settled for any larger withdrawal.
Avoid airport kiosks advertising "0% commission" or "no fees" — these almost always make up for it with a significantly worse exchange rate baked into the transaction.
Avoiding dynamic currency conversion traps
Many ATMs and card terminals abroad will ask "Would you like to be charged in your home currency or the local currency?" This is called dynamic currency conversion, and it almost always works against you. The conversion rate offered is set by the local merchant or ATM operator, not your bank, and is typically 3-7% worse than your card's standard exchange rate.
The rule is simple: always choose to be charged in the local currency, never your home currency. Your own bank or card provider will apply a better exchange rate automatically.