Money Tips for Mexico

Laura Elise, Demand Media 

usatoday.com

 

Mexican money. (Photo: mexican currency image by Joann Cooper from Fotolia.com )

Change matters in Mexico. Outside of large tourist resorts, travelers to Mexico might be surprised to discover large bills of local currency are commonly not accepted; they’re refused because vendors often do not have enough change. To buy a beer, catch a cab or walk away with local handicrafts, smaller is better when it comes to currency. To avoid awkward or disappointing money situations, take a bit of time before you travel to understand Mexican currency and how to use it safely and efficiently.

Know the Currency

In Mexico, the national currency is the Mexican peso (MXN), so your first money matter is to get familiar with these colorful bills. The most common bills come in denominations of 20, 50, 100, 200 and 500. They come in a range of hues, including purple, blue and yellow. The smaller bills will often be made of plastic, so feel free to take them swimming with you. Coins come in values of 1, 2, 5 and 10 pesos. Cents, or “centavos,” are worth very little. The same symbol ($) is used to designated prices, but this will always designate the price in pesos, never dollars, in Mexico.

Know the Exchange Rate

Before you start spending, you need to know what everything is worth in real terms. To do this, you need to know the exchange rate to your own national currency. In 2010, on average, $1 USD was equal to 12 to 13 pesos. Exchange rates fluctuate, so be sure to check online before you exchange money. You can exchange your local currency into pesos at airports or money exchange locations, but you will either be charged a fee or will pay an unfavorable exchange rate. You can also withdraw cash from foreign bank accounts from ATMs in Mexico, but you will likely be charged ATM fees, international withdraw fees and currency exchange fees. The cheapest way to get foreign currency is to withdraw it from your local bank before you travel. Most banks will do this for free, if you ask a week in advance and withdraw at least a significant amount of money; check with your bank for its specific policies.

Hidden Fees

If you insist on using American dollars in Mexico, you might get away with in it big tourist destinations, such as Cancun or Los Cabos, but be aware you will probably be charged at the standard rate of 10:1 (10 pesos to one US dollar). This will probably be a very unfavorable exchange rate for you. However, the biggest hidden fee will likely come from your bank or credit card company. Major credit cards, like MasterCard, charge one percent on all foreign transactions. Many banks also tack on fees. However, you are much better off using your credit card for large purchases in Mexico rather than using cash; the fees will be smaller in the long run.

Keep it Safe

Safety is a major concern for many tourists to Mexico. In large cities petty theft is a problem, especially on public transportation, and there are the occasional “express kidnappings,” when miscreants hold you overnight in order steal your full ATM withdraw limit for two days, once before and once after midnight. The best way to avoid these mishaps is to be aware of your surroundings and use common sense. Don’t carry large amounts of money. Don’t walk alone in dangerous areas; don’t flaunt your wealth. Carry only the money you plan to spend and keep it close to your body; keep the rest securely stored away. Try not to carry a credit card if you think you’ll be out alone late at night.

Tipping and Taxis

At restaurants, it is customary to tip 10 to 15 percent, with 15 percent being the standard in Mexico City and large tourist destinations. However, you do not need to tip taxi drivers. However, if you decide to hop in a street cab, it is nice to let the driver keep a few pesos of change. Before you get in a taxi, make sure the meter is running or that you have agreed on a final price. If the taxi is not metered, feel free to bargain down the price. A 10 peso tip is customary for delivery items, and you should tip grocery baggers and parking attendants a few pesos as well.