The fluctuating dollar brings insecurity and, when it’s on the rise, makes Brazilians think twice before traveling abroad. However, purchases made outside of Brazil, especially in the United States, are still advantageous due to the low value of the products.
Famous for their shopping, Brazilians are increasingly welcome in the USA, so much so that many airlines have made exceptions to the baggage weight limit. Normally only one suitcase of up to 32 kg is allowed, but Brazilians and Chinese are the only ones who have the perk of an extra suitcase, also with a limit of 32 kg.
In any case, regardless of whether or not you intend to go on a shopping spree, it is advisable to find out about exchange rate fluctuations and the best way to pay less for them and get even more value for your money.
See some tips we’ve put together for you.
Leave the credit card for emergencies
The credit card charges IOF of 6.38% for purchases abroad, plus taxes and conversions. What’s more, the amount paid in foreign currency is only defined when the invoice is closed, which can be good or bad, but in times of currency fluctuations it causes insecurity. For this reason, prefer a prepaid card, such as Visa Travel Money, Amex Global Travel Card or Mastercard Travel Card. With them you only pay 0.38% on foreign exchange transactions and there are several advantages (see below).
And the cash?
If the prepaid card is considered practically a cash payment, it usually has advantages over cash, especially in terms of security. In general, it’s better to have a card that you can cancel if it’s lost or stolen, than to carry cash and run more risks if something unexpected happens.
You have to watch out for card cloning, which also happens with prepaid cards. To avoid this, check your card statement every day to avoid being surprised.
The less often you exchange currency, the better. This rule tends to work in general when it comes to foreign exchange, as there are always losses/fees when exchanging. So the more you trade, the more you lose.
So, if you’re going to a country where the currency is sold in Brazil, plan ahead and get a consistent amount to take with you.
Another good alternative is to withdraw money in the country you are visiting. It will then be delivered in the correct currency. If you use a prepaid card instead of a credit card, even better – you won’t have to pay IOF, just the 0.38% you paid when you bought the currency and a local withdrawal fee – which varies according to the bank. In addition, withdrawals are available at any time.
When the currency is not common
The prepaid card converts automatically, but it’s more advantageous if it’s in the currency of the country you’re traveling in. For example, you can only have dollars on your prepaid card. And if you’re in Europe, you’ll be spending in euros. No problem – by swiping your prepaid card, the conversion will be made automatically to deduct the amount. But it’s always better in the original currency, in this case euros.
Bureaux de change vs. hotels
If you have to exchange money at your destination, prefer bureaux de change to hotel bureaux de change, although you can do it at the hotel in an emergency. This is because the rate is usually more favorable in specialized bureaux, including those available in airport arrivals halls. However, remember that it has to be a reliable exchange office, so you don’t run the risk of getting a bargain. Especially in destinations with a problem with counterfeit money, such as Argentina.
If you’re one of those who prefer not to exchange money and only carry your credit card or prepaid card, remember that you’ll always need small amounts, at least to use when paying for cabs, tipping, etc. Therefore, when making the exchange, always make a part in cash – and with swapped values.
It’s worth remembering that tourists can be very targeted in some tourist destinations. That’s why it’s always a good idea to keep an eye out for cash. On the other hand, make sure you have the contact details (website and telephone numbers) for canceling credit and debit cards in the event of loss or theft. And cancel them immediately as soon as you notice that one of them is missing.
Acquiring foreign currency little by little is a good way to save money and avoid big fluctuations in the exchange rate, since the real is at a disadvantage against both the dollar and the euro.
That’s why it’s important to plan how much you’re going to spend each day, to avoid falling into the temptation of spending more than you can afford.
The prepaid card
The number of Brazilians in Las Vegas is increasing, so much so that in the city’s main outlet there are advertisements entirely in Portuguese, as is the case in the image opposite.
Rose Meire Del Col, he Vice President of Prepaid Products at American Express recalls some of the advantages of prepaid cards and, specifically, of the Amex Global Travel Card. These include the fact that it is multi-currency, i.e. it accepts charges in US dollars, euros and pounds.
“What’s more, it is accepted at the millions of places where American Express cards are accepted”, account, as if it were a credit card. Another great advantage of Amex Global Travel Card is the fact that the user receives a spare card in his “welcome kit”. In other words, if you lose your card, the user cancels the lost one and can continue using it, not being at the mercy of luck.
Rose Meire also points out that Amex GTC has no inactivity fee and never expires, in addition to making exclusive promotions available to customers in large shopping malls and chain stores with great appeal among Brazilians, such as Macy’s, for example.
She also says that to make life easier for users, the product’s welcome kit also includes facilities for the main countries visited by Brazilians. “We also have a 24-hour call center in Portuguese.”
Prepaid card facilities
- The card can be loaded in several currencies and can carry the same flag as major credit cards without restriction for the establishment receiving the payment.
- Because it’s prepaid, it doesn’t suffer from the variations in currency exchange rates that are common in credit card bills, which always arrive after the trip. You travel with the amount you want to spend already entered on the card.
- As well as allowing for greater planning and fewer surprises when you return home, the prepaid card also offers another advantage – the lower IOF, since the tax is 0.38%. On the other hand, if you make the purchase on your traditional credit card, you will have to pay 6.38% of the expenses in IOF when the bill is due.
- If you decide to spend more than you have put on the prepaid card, you can top it up by bank transfer, whenever you want and for the amount you want. At most, you will have to wait 24 hours to confirm the transfer.
- Withdrawals with the card are made in local currency, in hundreds of countries, at ATMs of the flag indicated by the product.
- In the event of loss or theft, the card can be blocked immediately via the website or the Call Center. But make sure you keep track of your statements and transactions on the website so you don’t get surprised.
- But you have to be careful not to lose your card, since most establishments don’t ask you to enter your password (unlike withdrawals), anyone can make purchases.
- One limitation is that hotels and ships don’t usually accept the product as a deposit at check-in.
- Back in Brazil, you can keep the card with its balance for the next trip or withdraw the money at Banco 24 Horas or at a network indicated by the broker, bank or product.