# First time to Mexico--Cash or Credit Card? Need Advice (2013)



## off2maui

We will be traveling for the first time to Mexico for a stay at Casa Dorada in Cabo San Lucas. Friends recommended we take a lot of US cash because the ATM fees they paid in the Marina area were outrageous. Gave an example of an $80 fee on a $500 withdrawal. We normally use our credit card that has no foreign exchange fees added to purchases when traveling out of the country.  We also have a debit card that we can use at an ATM. Is a credit card easily usable in Cabo?

Hate the thought of traveling with a lot of cash.

In addition, are US dollars accepted widely in Cabo?

Seeking advice on how to pay at restaurants, shopping etc., and what amount of US$ to exchange at the airport for Pesos.

Thanks for your help!


----------



## siesta

no need to travel with alot of cash. US dollars are accepted everywhere, however you get better value paying with pesos. So using your credit card may not be a great value becaus even though you have no currency conversion fee, you will get a value of around 10 pesos per dollar the way they charge.

Your absolute best bet, is to open a capital one free checking account, 0% currency conversion fee, and they refund you the ATM fee up to $25 a month, and pull out pesos at a bank ATM. Most bank atms charge around $2-3 so thats at least 8 times pulling out cash for free, which is way more then youd need.

The story you hear of someone getting charged $80 in fees on $500 is absolutely absurd.  Unless they used sketchy private atms sitting in a dark corner that charges $10 per transaction, or pulled out money in increments of $20 each time, they are grossly exagerating. Bcause pulling out $500 with a typical atm card that has 3% or 5% fee would be $25 tops, and lets even say it was a $20 atm fee (which is absurd) thats $45, and again thats ridiculous. 

So basically your friends have no clue what they are talking about, because advising someone to take alot of cash with them is bad advice, and they either got ripped off at atm or are flat out lying/exaggerating


----------



## Passepartout

DO NOT take a lot of US currency to Mexico. There is a limit on how much your resort can exchange and you cannot exchange it without a business account at a bank. This was instituted to combat drug trade and money laundering. Use an ATM card AT A BANK- DURING BANKING HOURS. You will pay about $1.50 each to that bank and your own for each transaction. Get enough cash to last you a day or two to limit the expenses. Keep a limited amount in the account accessible to the ATM in case it's lost/stolen/compromised, then transfer from your savings or other account as needed on the internet. Charge all large purchases to a credit card as well as your resort expenses.

The reason I say only use a BANK ATM is the private ones are not regulated and may just capture your information. And the reason I say to use it during business hours is that I used one at a Santander Bank one bright Sunday morning. I got a receipt saying I'd made a withdrawal, but no cash came out. When I contested the charge with my bank the next day when they came to work, they shut off access to my account by card. Fortunately I had other accounts I could access or the trip might have been ruined.

Enjoy Cabo. It will be hot, but it's a DRY heat, and makes the margaritas taste soooo good and refreshing!

Jim


----------



## PStreet1

Thumbs up to previous responses.

I want to add another thought.  We opened a travel account at our regular bank (Wells Fargo).  It is not tied to our regular account in any way.  Now, I like the idea so well that I really don't use the other (main) account card at all.  I just transfer money into the travel account from the main account whenever needed by using the on-line banking features.  If I lose the travel account card or it is compromised in any way, my potential for loss is definitely controlled.


----------



## T_R_Oglodyte

check with your bank to find out if they have a banking relationship with a Mexican bank that reduces or eliminates ATM fees. 

For example, we have a BofA account, and we can use the Santander ATMs to take out money from our checking account in pesos, at bank exchange rates, and without ATM fees.


----------



## off2maui

Thank you for all the responses. We bank with Wells Fargo, so I'll be checking to see if they have a banking relationship with a Mexican bank.  I really like the idea of a travel account.  The Capital One free checking looks like a good option too. I knew there must be options not to carry around a bunch of cash!


----------



## T_R_Oglodyte

off2maui said:


> Thank you for all the responses. We bank with Wells Fargo, so I'll be checking to see if they have a banking relationship with a Mexican bank.  I really like the idea of a travel account.  The Capital One free checking looks like a good option too. I knew there must be options not to carry around a bunch of cash!



Before we go down, I try to get a couple of rolls of $1 coins.  I then use those for tips, because it's a lot more convenient to reach in my pocket to  pull out a coin than it is to go for my billfold, particularly when I have my billfold in a more secure location than my back pocket.  (Keeping a billfold in a back pocket is not a good idea when you are out and about.)


----------



## SMHarman

T_R_Oglodyte said:


> Before we go down, I try to get a couple of rolls of $1 coins.  I then use those for tips, because it's a lot more convenient to reach in my pocket to  pull out a coin than it is to go for my billfold, particularly when I have my billfold in a more secure location than my back pocket.  (Keeping a billfold in a back pocket is not a good idea when you are out and about.)


I did something similar, went to my local Chase and got $100 in singles.  Really handy for tipping.


----------



## bobpark56

*Better to tip with Pesos*



SMHarman said:


> I did something similar, went to my local Chase and got $100 in singles.  Really handy for tipping.



The Mexicans we have met seem to appreciate being tipped in Pesos, rather than with US dollars. It saves them losing money by have to pay the exorbitant fees associated with using a money exchanger to convert the tips into Pesos.

Why not be kind to the Mexicans who serve you? Or, I suppose, you could tip more generously.


----------



## pacodemountainside

I  have found  locals  fascinated with $1.00 US coins  and if  more then use two or  all those   local coins  you have accumulated.

WalMart exchange rate is  competitive.

I do put rental car on credit card as required for  collision insurance.

Do a couple TS pitches and end  up with plenty of pesos.

Yes, lots of small vendors use 10/1 to make math easy so much better to pay in pesos. Parking and gas come to mind.

Never had a problem, but sage  advice  on billfold  should be  heeded.


----------



## Passepartout

*Tip in pesos* (you wouldn't want to be tipped in a currency that required a stop at a bank), but nowhere near as lavishly as Americans tip at home- just at more places- for instance, you tip the grocery bagger, and if the gas attendant pumps your gas or washes your window tip him. For taxis, just round it up. Say, if the taxi fare is 150 pesos, pay 160. Also expect to pay taxi drivers for your luggage too- add 10 or so pesos per piece. Paco mentioned something I can reinforce, when you make purchases using your debit (ATM) card- like for groceries- you can get pesos along with the purchase for no additional surcharge.

*Some more Mexico tips for first timers*
At restaurants, you will never be given the check until you ask for it. It is considered rude- like you are being asked to leave. When you are ready for the check, no snapping of fingers or making scribbling motions, just ask, " La cuenta (kwenta) por favor". 'The bill, please'. The answer to "Gracias", 'Thank you', is "de nada", 'it's nothing'. When you enter a shop, greet the shopkeeper, "Hola" (Olah) and thank him/her, "Gracias" as you leave.

Have fun on your first trip to a warm, enchanting country.

Jim


----------



## bellesgirl

I agree that the ATM is the best way to pay for items in Mexico.  However, if you do use your credit card, it will be charged in pesos (not US dollars) and converted at the bank rate.  We use our Capital One card in Mexico all the time and get a great conversion  rate.


----------



## qb_bc

When I travel, I generally;
-take 500 in US dollars. For Mexico it isn't a problem, but for many other countries I get new bank notes with no tears or writing on them. 
-take small notes, 50 would be largest. This depends on how you expect to use them
-make local currency withdrawal from a bank ATM. Usually it matters whether it is Cirrus or Plus, so check your card to know which it is. 
-if I have too much foreign currency when I'm leaving, I keep enough for taxi and airport spending, and use the rest to pay down my hotel bill. 
-using bank ATM, and watching branding, the highest fee I have had to pay is $5.00. However many banks also charge 2 1/2% foreign exchange get rate when they calculate. Chase is good, in that they don't add this in.


----------



## T_R_Oglodyte

Passepartout said:


> *Tip in pesos* (you wouldn't want to be tipped in a currency that required a stop at a bank), but nowhere near as lavishly as Americans tip at home- just at more places- for instance, you tip the grocery bagger, and if the gas attendant pumps your gas or washes your window tip him. For taxis, just round it up. Say, if the taxi fare is 150 pesos, pay 160. Also expect to pay taxi drivers for your luggage too- add 10 or so pesos per piece. Paco mentioned something I can reinforce, when you make purchases using your debit (ATM) card- like for groceries- you can get pesos along with the purchase for no additional surcharge.



For some reason, tipping taxi drivers is not the norm in Puerto Vallarta.  We have often been advised by hotel staff that tipping taxi drivers is not the norrm, and I have actually had taxi drivers refuse to accept tips when offerred.

Otherwise - yeah - tipping of a lot more people is the norm.  Pretty much anyone who provides a service.

I don't worry about tipping in dollars because dollars are so widely accepted.  Also if you tip someone a dollar when ten pesos is the normal "unit", the recipient actually comes out ahead.  So if you would give someone 10, 20, or 30 pesos, give them 1, 2, or 3 dollars instead.


----------



## bjones9942

Same thing in Mazatlan about tipping taxi drivers.  If they make a stop or two for you on your way, or if you have a lot of bags - then tip.  Otherwise, no tip.

As someone who used to work for tips, and who lives near the U.S.A./Canadian border, I can tell you it's a royal pain in the a** to be tipped in a foreign currency, especially coins (there was a time - maybe still, where U.S. banks wouldn't take Canadian coin).  Just don't do it.  Really.  Instead of a roll of $1 coins buy a roll of $10 pesos when you get into town.  If it's that hard for people to make one trip to a bank, imagine how hard it must be for all the recipients of foreign currency to have to do it.  At least in Mazatlan, U.S. dollars are not widely accepted.  Any bonus with the exchange rate will be taken up with their time spent at the bank.


----------



## kwindham

I don't have any knowledge of further inland in another country, but when I was in TJ and Rosarito Beach MX in Jan, the people preferred us currency.  Maybe because it is so close to the border?


----------



## moonlightgraham

Also, if your resort gives you the option to settle your charges in dollars or pesos, settle in pesos. Most resort/hotel exchange rates are not nearly as favorable as you'll get via your credit card company. After a week-long stay of charges the difference of just a peso or two in the exchange rate can be considerable. On our last visit we saved around $100 by opting for the peso settlement option on a $1,000 bill at the Royals.


----------



## Passepartout

kwindham said:


> when I was in TJ and Rosarito Beach MX in Jan, the people preferred us currency.  Maybe because it is so close to the border?



Of course they would prefer US Dollars when they can get them from you for 10 pesos each and the bank rate is 13. That on top of whatever the profit margin on your purchase is.


----------



## T_R_Oglodyte

bjones9942 said:


> Same thing in Mazatlan about tipping taxi drivers.  If they make a stop or two for you on your way, or if you have a lot of bags - then tip.  Otherwise, no tip.
> 
> As someone who used to work for tips, and who lives near the U.S.A./Canadian border, I can tell you it's a royal pain in the a** to be tipped in a foreign currency, especially coins (there was a time - maybe still, where U.S. banks wouldn't take Canadian coin).  Just don't do it.  Really.  Instead of a roll of $1 coins buy a roll of $10 pesos when you get into town.  If it's that hard for people to make one trip to a bank, imagine how hard it must be for all the recipients of foreign currency to have to do it.  At least in Mazatlan, U.S. dollars are not widely accepted.  Any bonus with the exchange rate will be taken up with their time spent at the bank.


In Puerto Vallarta US currency is widely accepted. Almost everyone will gladly accept your dollars as the equivalent of ten pesos, and give you change back in pesos and centavos.  I've seen them actually seem disappointed when  I pull out my pesos; they can be very quick, too quick in fact, to assure me that they take dollars as well as pesos.  When they see me getting ready to pay in pesos, and they chime in that they accept dollars, that tells me they would rather get dollars than pesos.


----------



## jules54

In the Playa Del Carmen area and also the Cabo area everyone always seems to prefer US dollars. I use my credit card with no transaction fees or conversions fees and always make out ahead in the exchange rate. Usually the only thing I use pesos for are taxi, buses or places to eat that don't take credit cards. When I use dollars or peso I do a quick conversion in my head or on phone to see which is coming best.


----------



## Passepartout

jules54 said:


> Usually the only thing I use pesos for are taxi, buses or places to eat that don't take credit cards. When I use dollars or peso *I do a quick conversion in my head or on phone* to see which is coming best.



You are clearly much more talented than I to be able to figure in your head if paying in US dollars will beat the bank rate at an ATM. Today's bank exchange rate is roughly 12.66 pesos per dollar. I'd be interested in hearing a scenario of how that would that work.

I used to print out a 'cheat sheet' at www.oanda.com with both dollars/pesos on one side and pesos/dollars exchange on the other, just to be able to compare. Any more I just get pesos at a bank ATM and make purchases and pay resort fees on credit card. It's easier and I think saves on fees.

Jim


----------



## easyrider

If a person is unsure of how many pecos is how many dollars it can lead to over tipping or getting short changed. An example is the 200 or 500 pecos bill can easily be confused for $2 or $5 when they are worth about $20 or $50. 

I use USD for everything in Cabo with the exception of US coins which are worthless in Mexico for the most part. The entire South Baja tourist area ( Cabo, San Jose del Cabo, Cerritos, Todos Santos, Playita) is accepting USD and gives change back in pecos. Even the little mini market up in the hills takes USD.

In the Banderas Bay areas its hit and miss. PV and NV the USD works fine but in Bucerias the regular Mexican stores have a hard time with USD. The bars and tourist restaurants accept USD.

The resort can only exchange $300 USD into aprox $330 Pecos a day per person.

I like giving $2 bills for tips. 


Bill


----------



## Passepartout

easyrider said:


> The resort can only exchange $300 USD into aprox $330 Pecos a day per person.



And for your $300, at today's rate, the bank ATM will return just shy of 3,787 pesos. You exchange your way, I'll exchange mine.

ETA, the above exchange will cost you about $3.00. $1.50 each to your bank and to the Mexican bank, unless your U.S. bank has an agreement with the Mexican bank. iirc, B of A and Santander, and some others with HBSC. Check before going to Mexico, you might save a small fee.

Jim


----------



## PStreet1

Passepartout said:


> Of course they would prefer US Dollars when they can get them from you for 10 pesos each and the bank rate is 13. That on top of whatever the profit margin on your purchase is.



I was just getting ready to reply to that post when I found yours.  You are 100% right.  If they gave you the bank rate, they would, of course, lose money when they converted it.  At 11 to 1, they make enough to make it worth while for them.  There are also limits now regarding how much can be deposited in the bank in each account in dollars, so they need to consider whether they can deposit it or where they can spend dollars (and spending them entails how much the person receiving the dollars will charge them for using dollars, too).  Pesos are a "cleaner" transaction for all; you know what you are paying and you can judge the percentage you will leave for a tip.

Here in Rosarito, we are so close to the border that tipping is generally the same as it would be in the U.S.--and of course, we tip everyone who does a service:  the sacker at the grocery store, the guy in the parking lot anywhere, etc.


----------



## easyrider

Passepartout said:


> And for your $300, at today's rate, the bank ATM will return just shy of 3,787 pesos. You exchange your way, I'll exchange mine.
> 
> ETA, the above exchange will cost you about $3.00. $1.50 each to your bank and to the Mexican bank, unless your U.S. bank has an agreement with the Mexican bank. iirc, B of A and Santander, and some others with HBSC. Check before going to Mexico, you might save a small fee.
> 
> Jim



Your way works very good for some one that wants to actually go out and find the best exchange rate. Exchanging $100 usd to pecos is only ( $8.00 usd) 104 pecos difference from the resort to the best exchange rates available. The resort exchange is easier , faster and more convenient for most travelers, especially a first timer, imo. 

Another thing about USD in Mexico is that most places can not break large American bills, so $20 bills are about as high a denomination as most places can handle. The exception is the resort and the banks.


----------



## Passepartout

easyrider said:


> Your way works very good for some one that wants to actually go out and find the best exchange rate. Exchanging $100 usd to pecos is only ( $8.00 usd) 104 pecos difference from the resort to the best exchange rates available. The resort exchange is easier , faster and more convenient for most travelers, especially a first timer, imo.



Bill, get out of your mind even carrying/exchanging US currency. Nothing is easier than simply going to a bank, or using the bank ATM at the airport and getting a 2-3,000 pesos. Repeat as necessary. You and I can't walk into a Mexican bank and exchange currency without a business account. You don't have to sweat carrying large amounts of currency. Thieves are no worry as is losing track of where you put it.

Sure, you can use the resort to exchange some currency. They will only exchange a limited amount each day, and believe me, they will make sure they make a profit for the trouble of taking your USD to the bank. I'm willing to say that the resort will give you about 12 pesos/dollar while the ATM will give you 12.70 or more.


----------



## radmoo

Don't forget to call your bank and credit card companies BEFORE you leave home to notify them of travel dates and destination!


----------



## Passepartout

radmoo said:


> Don't forget to call your bank and credit card companies BEFORE you leave home to notify them of travel dates and destination!



A *wise* piece of advice- no matter your destination. Even domestic.


----------



## easyrider

Jim, you are very right that it is easy to go to the bank and use the ATM in Cabo. There is one at the mall. Cabo might as well be a Los Angles suburb as far as Im concerned. 

We rarely exchange money in Cabo, maybe $100 for the flea market. Most all purchases at Walmart, Costco and the resorts are with our credit card. Even for activities like golf, fishing and rental cars we use our credit card.  

My first experience at the Cabo mall ATM wasn't very good. For some reason we thought we needed to have pecos so we had to find the right ATM and the right bank so we could withdraw pecos. This took about an hour out of my day as a newbie and costed me taxi fare both ways.

As far as Im concerned, I use the resort exchange and can afford the $8 difference as my time in Mexico, even doing nothing, is worth more than $8 savings to change over $100 usd, and I know where the ATM's are. Its just convenient I suppose. So the convenience is worth it to us. 

The airport is not a place we would hang around as there always seems to be too many helpful people with an agenda. In fact, the airport is the worst part of a Cabo vacation, imo.  

Anyway, there isn't much need to exchange usd's in Cabo anyway as every time you buy something with usd's you usually receive pecos back in change.

Bill


----------



## PStreet1

It's pretty easy to figure that prices in pesos have to be divided by 10 and remember that figure will be too high.  It certainly is good enough to prevent 200 pesos from being mistaken for $2.00 instead of $20.00.

While all of us can afford the resort exchange fees or we wouldn't be in Cabo/Cancun/etc. in the first place, the idea of paying 8% goes against my grain.  I also don't use mall ATM's; it's pretty easy to find a bank, and as you say, use dollars until you do find a bank; but understand that when you do use dollars, you are being taken for another small(?) percentage with every purchase.  You are also being taken for another small(?) percentage every time you pay in dollars and get pesos as change.

No problem with doing that if it suits you, but anyone doing so needs to have a rough idea of the percentage extra he is paying when he does.


----------



## Passepartout

I get a kick out of some who visit these threads who will apply for Capitol 1 cards- and encourage others to do the same- to save the 1% foreign transaction fee, yet will pay the 8% premium to exchange at the resort desk. 

The difference between a tourist and a traveler......


----------



## easyrider

The main point is that a person doesn't really need to change USD to Pecos in Cabo. You can get by with a credit card at the grocery stores, resorts, golf courses and restaurants. If you want trinkets at the flea market you will get change back in pecos when you use dollars.

My last trip to Cabo we didn't exchange any USD in the two weeks we were there. 


Bill


----------



## Passepartout

Bill, the point here is that the OP is savvy enough in the workings of money and international travel that s/he has and uses a Cap 1 card to avoid a 1% foreign transaction fee. S/he asked if they should carry a large stash of USD instead of using ATMs. We counseled them not to do that for a variety of both safety and financial reasons. I still maintain that for the fiscally savvy, when traveling internationally, getting your spending money at bank rate at bank ATM's makes the most sense. Yes, purchases, restaurants where allowed, resort fees, golf, etc. etc. etc. should be paid with the aforementioned Cap 1 card and settled up with after getting home and reviewing the bills. 

That you used USD exclusively at a trip to Cabo surely endeared you to the vendors who not only got their retail value of their goods/services, but the premium you paid them to do the exchange too.

I was just at the store today, and people were lined up to part with their hard-earned dollars in the hopes of getting part of a record lottery winnings. They would all tell you it is an 'investment'. No, it's a tax on those who can't do math. Same as traveling the world on US dollars.

Jim


----------



## easyrider

When you consider that a trip to Cabo with everything included has an average cost of $1500 per person per week, the extra $8 to ex change $100 usd is chump change. imo. 

I guess this might put me in the tourist group Jim. 

So I did call my credit card company to see what I pay to use my card in Mexico and the total foreign transaction fee is 3%. The 2% savings with a CAP 1 card is also chump change, imo. I suppose if we were living in Mexico it might be a consideration.


----------



## Passepartout

Here are some semi-real exchange rates. We flew in to Mazatlan on Wednesday. I had it in my mind to get 6,000 pesos at the airport ATM. Turned out that wasn't one of the choices. 7,000 was as close as They offered. So I took it. Then looked at my bank statement. They cost $366.50 plus $3.67  in 1% foreign transaction fee and $1.50 for using the out of network bank. So I had been figuring 20/$1.00. The actual rate is not quite that, but a belongs lot better than the 17.3/$1.00 at the cambios (exchanges) on the street. 

Now, these numbers were accurate 3 days ago. Next week They will be different. And I'll need more pesos. So it goes.

Jim


----------



## dioxide45

Passepartout said:


> Here are some semi-real exchange rates. We flew in to Mazatlan on Wednesday. I had it in my mind to get 6,000 pesos at the airport ATM. Turned out that wasn't one of the choices. 7,000 was as close as They offered. So I took it. Then looked at my bank statement. They cost $366.50 plus $3.67  in 1% foreign transaction fee and $1.50 for using the out of network bank. So I had been figuring 20/$1.00. The actual rate is not quite that, but a belongs lot better than the 17.3/$1.00 at the cambios (exchanges) on the street.
> 
> Now, these numbers were accurate 3 days ago. Next week They will be different. And I'll need more pesos. So it goes.
> 
> Jim


Exchange rates on the street are usually pretty bad, I certainly wouldn't use them. Your effective exchange rate given the fees was 18.83, though the straight exchange was actually 19.09. The rate three days ago was around 19.25 depending on the day and time. The best rates are usually using a credit card, followed by the ATM in Mexico, then buying cash from the bank back home. Though this has been well covered here already.


----------



## pianoetudes

T_R_Oglodyte said:


> For example, we have a BofA account, and we can use the Santander ATMs to take out money from our checking account in pesos, at bank exchange rates, and without ATM fees.



It's Scotia Bank now, not Santander.


----------



## T_R_Oglodyte

pianoetudes said:


> It's Scotia Bank now, not Santander.


That's correct.  You are quoting a post that was made almost five years ago, when Santander was the BofA associated bank.


----------



## pianoetudes

T_R_Oglodyte said:


> That's correct.  You are quoting a post that was made almost five years ago, when Santander was the BofA associated bank.



I know. Your post was 2013. I see Santander ATM more frequently than Scotia.


----------



## T_R_Oglodyte

pianoetudes said:


> I know. Your post was 2013. I see Santander ATM more frequently than Scotia.



In Puerto Vallarta we have found Scotia to be much more convenient than Santander.


----------

