When traveling in Portugal, using your debit or credit card seems straightforward, right? However, a sneaky practice called Dynamic Currency Conversion (DCC) can end up costing you more. Whether you’re at an ATM withdrawing cash or paying for a delightful Pastel de Nata, you might be asked if you want the transaction processed in US dollars instead of Portugal Euros. The golden rule? Always choose Portugal euros.
Why is this crucial for your wallet? Opting for US dollars hands over control of the exchange rate to the processing bank – and trust us, it won’t be in your favor. This unfavorable exchange rate is how DCC becomes a hidden fee, potentially adding a significant amount to your expenses. Hotels, restaurants, and shops often benefit from DCC, and their staff might subtly (or not so subtly) encourage you to pay in your home currency. When using your card, especially a credit card, maintain control of the payment terminal to ensure you’re the one making the currency choice and selecting euros.
If you’re a savvy traveler with multiple credit cards, take a moment to check their foreign transaction fees before your trip to Portugal. Some cards impose flat fees per transaction plus a percentage, while others offer much better terms for international use. Identifying the most travel-friendly card can save you money on every purchase. It’s wise to carry at least two different cards as a backup in case one is lost, stolen, or simply doesn’t work for some reason.
For more excellent financial tips while traveling, Rick Steves offers a wealth of advice on his website: https://www.ricksteves.com/travel-tips/money. While his site is comprehensive, it’s worth emphasizing the growing prevalence of DCC and ATM usage fees, issues that have become increasingly common in recent years. Even if you haven’t encountered these problems in Portugal before, being informed and choosing Portugal euros is the smartest way to ensure you get the best exchange rate and avoid unnecessary costs on your trip.
