Pre-paying for hotels?

If you think you know where the dollar to euro valuation will be in 5 months, then go for it.
Just remember once you pre-pay the hotel, that money won’t be earning anything for you as it would in the money market or any other investment.

No way to know what will happen by September. Make the decision that suits your risk tolerance for the unknown. Having traveled in years when it was $1.50 to the euro, even the current rate is not so bad to me.

Will you have cancellation/interruption insurance? Then you'll get your money back if you have to cancel for a covered reason.

Given the current uncertainty, I wouldn't be betting on the USD reversing it's slide against the euro any time soon. But what do I know; my magic 8 ball is in for annual maintenance.

With prepaying, you lock in an exchange rate, and you get a better rate on the room cost. Of course both come with risks of better future exchange rates and no cancelation policies.

First, you are committed to the RS tour. Is Barcelona a maybe or a definate, we are going there, not a chance of changing our plans? Second, is the discout to prepay worth it? If the is no prepay discout, IMO, pay later and don't worry about the currency fluctuations.

I have a trip coming soon. When I saw the exchange rate changing, I went into Booking and paid for almost all of my free cancellation lodgings. I usually pay them right before I leave for a trip, anyway, because I always bring a copy of the receipt page when I check in so there’s no question about payment. Otherwise, sometimes Booking pulls a payment from me while I am on the trip, and I like there to be no question that it’s been paid.

is the discout to prepay worth it?

The discount varies a lot depending on the hotel. But its my impression that 10% to 15% is the norm. So a two week holiday is 14 nights at $200 a night refundable might be $175 a night refundable or which is $350 less for the trip. While that is real money, I rarely get non-refundable. i guess I should, that and buy trip insurance. But I dont want the hassle of a trip insurance claim and they dont pay for all the reasons I might cancel. (those numbers are from a fairly popular 4star down the street from where I live).

At $1.14 to €1 the difference in price for 5 nights on a €200 room would only be $50 and that’s if the rate went up to $1.19. The rate is what it is.

Considering the cost for the trip you’re talking pocket change.

Foolish. If your budget is that tight and you’re in angst over currency fluctuations, should you reevaluate traveling?

I pay everything off in advance of leaving home, but only a couple of days before leaving on a trip.
Not to save money, but to have my credit card paid off before leaving, in case I need it for say, an emergency flight to get home or something.
Also, no debt after a trip….unless you are a big shopper…. ;))

If the issue is just the exchange rate, then if you have any sort of investment account for stocks, etc., you can buy an exchange traded fund that invests strictly in the desired currency. The Euro fund is FXE, Swiss Francs is FXF, I don’t recall the symbols for the other currencies. Doing so will lock in the current exchange rate. When you get back you can sell the fund to pay the bills. If the dollar gets weaker then growth in the investment will offset the higher charges (in dollars), but if it gets stronger then loss in the investment will offset lower charges. Also, you won’t get interest on the money in the fund. Good luck!

When the $ to the Euro was at $1.04 or $1.03 , I changed over $3,000 to Euro, Bof A charging me nothing for the transaction. Of course, the rate Bof A offered me was $ 1.09, more or less what I had figured. I took the offer.

I'll be bringing that cash over, I don't expect the rate for the $ to improve either by the summer, having slipped so fast in such a short period of time. Paying cash sometimes does get you a reduced rate at family -run hotels in Germany and France.

I would prepay and take your concerns away. Otherwise you are constantly checking, worrying and maybe you pay more. If you could have paid less in the fall, no matter, because you are satisfied now at the present price.
The way things are going there could be a large collapse of the dollar..
Losing the possible investment in an ETF or money market as some have suggested is ludicrous. At 5 nts/$300 night that is $1500. What kind of return could you expect. Maybe enough for a couple glasses of wine. And if an ETF, well, things are going poorly on that front and then your money may drop and you are now in another worry and watch that price movement.

I would suggest prepay. Conceivably, the $ can slip lower that $ 1.14 or even $1.15.

Obviously, the rate currently is worse than that given to me by BofA at $1.09 to convert over $ 3,000 to Euro with nothing charged for the transaction.

Thanks to all for their responses. I lived in Europe in the late 80s and the turn of the century when the Euro replaced other currency. I decided to prepay because I will have less of a shock when my credit card bill arrives. The hotel in Bordeaux did not waste a moment complying with my request to prepay at a rate of 1.13E to $1. Now on to funner trip planning.