Dos and don'ts of money while travelling

Anonymous person magnifying view of coins shaped in world map. (Pexels/Monstera)

As a former financial advisor, I’ve always been fascinated by how the “culture” around money differs from one region of the world to another.

This can be influenced by a country’s economy, cultural values, religion, key industries, and the opportunities available to its citizens.

Cultural narratives “influence how we interpret actions, how we think, and how we behave,” World Bank’s Lead Economist Karla Hoff wrote in 2016.

Today, I’ll outline some of the interesting money habits that I’ve noticed while travelling the globe, starting with some of our own!

1. Canada

Canada has its own cultural norms around money that are so habitually ingrained that you probably don’t give it a second thought.

Take the tipping culture, for example. It’s considered very rude if you don’t tip at a restaurant or for other services such as:

• Valet car service
• Room cleaning
• Ridesharing (such as Uber and Lyft)
• Food delivery

The United States also shares a similar sentiment toward tipping.

However, you may be surprised to hear that tipping could even be considered offensive or belittling in countries such as Japan, South Korea, and China.

Another interesting money trait in Canada is that taxes are usually not included in the displayed price of goods and services. Foreign visitors may be surprised to see that their total after taxes is higher than the listed price of items and services.

2. Mexico

Aside from the large difference in value between the Mexican peso and the Canadian dollar, visitors may be surprised to see:

• Many places do not accept credit cards
• Tipping with credit cards is not very common (unless you’re in a resort)
• Cab drivers do not expect tips, while most other service providers do

Mariachi bands are very common in Mexico and are especially popular at restaurants. These mariachis typically aren’t paid to perform by the restaurant, though, as you may expect in Canada. Instead, they rely on tips from the patrons. In many cases, patrons can hire the band to play a popular song to serenade their partner or celebrate a birthday.

After speaking to some of the locals, I also realized that many Mexicans have a strong distrust of banks. Many locals prefer to bury their money underground rather than trust it in a bank. Part of this is also due to the lack of banking infrastructure outside major cities.

Since bank loans aren’t common, families and friends often pool their money together to invest in land, fund a party, or support a sick family member. This practice is known as a tanda.

3. Japan

One thing I noticed about Japan is how prevalent coins are. The Japanese yen has many coins, including 1, 5, 10, 50, 100, and even a denomination of 500 yen (around C$5).

One very interesting difference you may notice when shopping in Japan is that it’s common to use a small change tray (called a koin torei) to place money in when making a transaction. It’s actually considered rude to hand the money directly over to them without using the tray.

It is often considered disrespectful for a merchant to “grab” money from a patron’s hand, plus the change tray is a more clean and organized way of handing cash over.

4. Vietnam

If you’re travelling to Vietnam, make sure that you exchange some of your Canadian dollars for Vietnamese dong (the country’s primary currency). Outside of major resorts, hotels, and other international retailers, the country’s economy is primarily cash-based, and your cards won’t be accepted in many places.

Vietnam has a very strong bargaining culture that may seem strange to Westerners who are used to paying a set price for most items. This is not always the case in places such as department stores, but if you go to a market, you have the green light to bargain . When purchasing goods, the first price given to you is often the top haggling point.

Many vendors expect customers to engage them and haggle the price of goods or services down until an agreed-upon price is settled by both parties. This may seem confrontational to some, but it’s just the standard way of doing business for many Vietnamese.

Something else that I noticed is that if you want to be extra polite when handing money to someone, use both hands and grip the bill on each side.

5. Thailand

Like Vietnam, Thailand’s economy is largely cash-based, with a strong haggling culture for everyday goods and services. You’ll need to convert your Canadian dollars to the Thai baht to pay for most things.

I’ve also noticed that the Thai greatly respect their bills. The image of some of Thailand’s greatest kings are on the front of each bill, and some people show respect for this in several ways:

• Bills are not placed in the back pocket, as this would be “sitting on the king’s face”
• Small bills are often displayed on a business’ walls to bring good fortune

Respecting the culture

If you want to be respected and treated kindly during your travels, it’s always best to follow the cultural norms of the country you’re in.

Before travelling to a new country, it’s wise to research some of the culture’s money habits. What may be perfectly normal in your home country may be awkward or disrespectful in another country.

If you’re ever unsure, don’t be afraid to ask. It shows that you’re respectful and willing to learn a culture’s way of doing business, and is far better than making incorrect assumptions.

Christopher Liew is a CFA Charterholder and former financial advisor. He writes personal finance tips for thousands of daily Canadian readers on his Wealth Awesome website.