How to decide whether to go to Paris now or to wait for an unknown time when the Euro/US dollar exchange rate might be slightly more comparable? Any thoughts/ideas?
Who knows, it might get worse and you will berate yourself for not going when it was better. Truly, no one knows these things and if we did, we would all be buying and selling currency for a living. The exchange rate is what it is. If you want to come to Europe, just do it, and realize it will cost more than it did in the 1960's or 1970's.
I agree. In the future, the exchange rate could get worse or better, and if it does get better, there might not be the time to do it. Still, it helps to hear what people have to say.
And without taking any one side with respect to ideology or political party, which I'm normally more than happy to do, I'll have to agree that the President has absolutely nothing to do with the exchange rate...doesn't matter who's in office. Corporations run the country anyway...also doesn't matter who's in office. As for worrying about it, don't. Like many others have already said quite well, travel when you have the time and money. You may not be around this time next year, so don't wait. Sometimes, the exchange rate is better, and sometimes it's worse, but I've never let it preclude me from traveling. If it's bad enough (like in 2004), I'll proactively start looking for other ways to save or cut expenses here and there, but I'll still go. But if you still think the Prez has something to do with exchange rates, you should have voted for Ralph when you had the chance. :)
As is true for many other Americans living in Europe, my family gets paid in dollars, but must pay for living expenses in the local currency. We take a hit on the exchange rate, not just for vacations but every day of our lives. But as Jo said, the exchange rate is what it is and there is nothing I can do to change it. The advantages of living overseas are many and it is where we want to be right now; therefore, we don't waste any time worrying about it. We just deal with it. My advice is to take the opportunity to travel in Europe whenever you can and simply adjust to the exchange rate. Economize somewhere as you need to, but enjoy your travels.
How interesting! I thought that one option would be to work in France and get paid in Euros-but even that doesn't seem to happen. I agree-how often do you find yourself with the health and free time to do what you wish to do. Not having the ideal rate would mean choosing carefully, and appreciating more.
Yes, the exchange rate is lousy now, but, really, compared to how it's been in the past few years, even if it gets to the best its been in 5 years, we're talking about maybe a 10% difference. Just go. Reminds me of a favorite saying in our house -- "When I tell you them berries are ripe, you get your bucket!"
Just cut your expenses where ever you can and go. Don't bring home gifts for other people, just bring home your memories, and have a great trip!
Haha, Maureen, thank you! Thanks, Terry! Love your comments. Everyone is so right.
"The biggest mistake we make is thinking we have time." If you can go, do it. Who knows, the European debt crisis may decimate the Euro before you depart. Not likely, of course.
Just go. This won't be your only trip to Paris, so your next one will have a different exchange rate, and I would recommend that you go then, too. You don't want to keep pushing your trip waiting for the "perfect time". I tell my wife this all of the time, she accepts it and ALWAYS has a blast. In the end, get the experience while you have your health and the capacity to go. You may have to be a bit more cautious on what you spend, but you won't regret it.
<<"The biggest mistake we make is thinking we have time.">> Tex - I really like that one.
When you are sitting at a Paris cafe or staring up in awe at the Colosseum, the exchange rate is not what you're going to be thinking about. I plan my trips based on everything but, and then if the exchange rate happens to be lower, I consider it a happy bonus. If not, hey, I'm in Europe! There really isn't any way to 'win' when it comes to the currency exchange and even if you lucked into going when the dollar is stronger against the euro, maybe the airfares have gone up. Going to Europe costs money but what you gain back in memories, broadened horizons, and experiences is worth the price for most of us (or we wouldn't keep doing it). If your finances are such that you have to cut costs, then do so, but trying to time the exchange rate is not going to help you out very much.
I agree with the others. Just go. You will always save money by staying home but in my opinion that's an unacceptable reason for not traveling.
I am always a little surprise at what people focus on as decision points about travel. My perception is exchange rates and airline fares. Both a small percentage of the total travel costs. The swing between high and low exchange rate over the last five years or so is about 15%. Not insignificant. Interesting information but no way to take advantage of that swubg. It is a fools game waiting for the exchange rate to be more favorable so I can afford to travel because you never will. Like the stock market. I was featured in a national financial magazine a few years contrasting my investment approach with to a good friend. The good friend was always waiting to invest but could not pull the trigger because the market was too high or was going down and waiting for it to be lower. While I was net buyer nearly every month regardless if the market was high or low. Same with the exchange rate. You cannot forecast the moment. You generally will lose more waiting than you can gain. Same with airline fares. People will engage in an enormous amount of brain damage to save two hundred dollars. The "same effort" on the rest of the travel schedule probably will yield greater saving that whether the airplane ticket was $1100 or $1300. I would love to get a $500 ticket and a .89 Euro like I did in 2000 in Spain but those days are gone. So build your budget on today's rates and do it. Remember time is only thing we cannot save.
Given the current situation with the US economy and strength of the $US things could likely get worse if you wait. Putting off a trip in order to maybe save a few hundred dollars seems like a bad bet.
Two questions: Has anyone on this website ever based a decision to travel or not to travel based on the current exchange rate? A few years ago, when the dollar was at a low versus the euro, many of the left-of-center posters here blamed George Bush. So, who is to blame now, I wonder?
That is a stupid response. And fail to understand even the purpose of trying to make this a political question.
Tom, I'm still blaming Bush..and Reagan. The economic downturn in the USA has been a long time in coming. Deregulation on Wall Street, failed tax breaks for the wealthy, unnecessary wars, etc. All have contributed to the current crisis. Obama just inherited the mess, and it's going to take longer than 2 years to clean up after the Republicans. I suppose this is going to start off all kinds of political discussion, and I'm sorry, but I just had to throw my two cents in after your comment (because I'm left of center). Anyway Sarah, just like everyone else says, travel while you have the time and good health. I'll be leaving for Europe in four weeks and couldn't be more excited, exchange rate be damned. Happy travels.
Not trying to make it into a political issue. I'm just pointing out that currency exchange rates fluctuate all the time, and unless a country makes the unusual choice to deliberately, unilaterally devalue their currency (as the US did in the 1970s), it will continue to fluctuate no matter who is in office. It even continues to fluctuate during relative good economic times. For a period in the 1990s, I remember hearing complaints that it was all Clinton's fault that the dollar was at a temporary low versus the Deutsche Mark and the pound sterling. I'm sure travelers made the same complaints during every recent administration (they probably had a good point during the Carter and Nixon administrations, though...). Likewise, some of the richer euro members were blaming Greece and their own politicians from the opposite side of the spectrum (Sound familiar?) when the euro was loosing ground to the dollar last spring and summer. The point of all this? From no matter what perspective you take, it always looks like a bad time to travel if you think too hard about currency exchange, fuel prices and all the other little costs that move up and down. The best time to travel will always be when you have TIME, not all the other little variables that NOBODY can predict or influence... not even George Bush or Barak Obama, or whoever else will occupy the Oval Office, 10 Downing Street or the Élysée Palace 10 years from now. But if I had to weigh in politically... seeing that it always seems to be the other guy's fault, I'm going to say that it probably isn't any one politician or party's fault.
Thanks, Tex, Darren, Tom, Liz, Sarah, Frank, Jeff, Paul and Michael for taking the time to respond to the question. People on this site may not have considered the exchange rate, but the first thing friends have said when I mention that I am considering this trip is that they considered going, too, but didn't because of the exchange rate. So I had to ask. Hearing everyone's point of view has been helpful. And I appreciate that while people have differing opinions, they have expressed theirs in a considerate way. Kind regards, and thanks.
Sarah..hope you decide to go. I think if one REALLY wants to travel they will overcome almost any obstacle, so those friends who say they won't go because of the exchange rate maybe just don't have the passion to travel that some of us do.
Thank you for your encouragement, Terry, (and all), I am looking at details and trying to come to a conclusion. Best wishes.
Sarah, I'm getting into the discussion a bit late, but have a few comments to add. Unless the exchange rates are horrendous and going to cause severe financial hardship if you travel now, my suggestion is to forget about them and focus on the trip. There's NO WAY to predict where the exchange rates will be at the hypothetical "unknown time", so there's no point in worrying about them. I learned an important "lesson" a few years ago, when I suffered a debilitating injury which prevented doing any travelling. From that experience, I learned that one event can affect the best laid plans, so if I wanted to travel I would need to do it as soon as possible and not be concerned with exchange rates, air fare costs or other "minor details". That's the method I use to "make peace" with the exchange rates and other things of that type. I'm assuming your travel budget has a slight "cushion" in it for unexpected expenses? If you want to go to Paris now, start making plans and have a great time! Happy travels!
Hi Sarah I work in a hospital and have seen many people miss out on there dream vacation because of illness. I have taken many of my patients advise, "do your traveling when you can, you cannot count on your health" Since then I have lived by that. I have taken a number of trips with the currancy low and extreamly high. When it was high I adjusted other things I had control of. I did not regreat one of my trips. Now that I myself am having health issues at the age of 48. I am greatful for taking my patients advice. I still plan on traveling, they will be shorter trips and at a slower pace. Take your trip, enjoy, cut were you can. And don't worry about the small stuff. If you wait for the right time it will never come. Enjoy Paris Wendy
I find it less stressful to just "pretend" that I am paying with USD rather than euro, ignoring the conversion. Yes, it really is more expensive but if you have to worry about the trip costing you a few hundred dollars more you probably can't really afford to be going anyway.
Hi Sarah. I do trade foreign currency and can give a little information. Political and financial conditions do play a part in currency values but not as much as one might think. The major market makers are large banks who trade millions at a time and not just hundreds or thousands as we retail traders do. Two to three trillion dollars is traded daily on an average day. Since the Forex market is multi national, agencies like the SEC cannot make rules like they can with US investments. The job of traders that trade for the large banks is to take money from small retail traders. That is how they make money. If some of the large banks all buy the Euro at the same time it will move the market for awhile even if the economic conditions of the Euro are not good. The Euro topped out at 1.60 twice in 2008 and then dropped to 1.18 even though the dollar was not doing well. My opinion is go and have fun and then plan on going again in the future. I think the Euro is going to get close to 1.60 and maybe a little higher before it drops(opinion only). The secret is knowing if you plan on going again. Since I am planning another trip I bought some Euros when the rate was at 1.20 and stashed them. If you plan on going again in the future buy some in a year or so when the rate comes back down. Strong flucuation is how the large banks make money in the forex market so the one thing you can be assured of is the rate will drop in the future and then go back up again. Good luck and have fun.
Like most people, we have money tied to mutual funds. I have noticed that - for reasons beyond my understanding - when the stock market does well, the dollar goes down in value and vice-versa. So what I have done over the last several months is to remind myself that while the recent fall in the dollar might cost us another $1,000 or so in trip expences (at most), the accompanying rise in the stock market has made us about $10,000. So if the two indexes have to move in opposite directions, I'm sure lucky they have gone in the direction they did!! Keep traveling!
I would go now, because it will get worse before it gets better. Due to the large fiscal deficit / mounting government debt, it's inevitable that the Fed will have to continue to monetize the debt i.e. print money. This will be inflationary over time (maybe sooner than we think), which will hurt the dollar's value vs. the Euro and other currencies. The reason why the dollar gets stronger when some crisis hits is that global investors would rather be in our port a storm. If it seems to get weaker when the stock market goes up, it's because people are more optimistic. At least that's my theory. Oh for the days when the Euro was 85 cents. That's when we were in Ireland, back in 2002, and that trip felt as if it were almost free. We stayed in nice B&B's for $45 per night. (Which was good because I was in between jobs at the time). A good plan might also be to go to less expensive countries in terms of destinations. (Portugal comes to mind, we were there in 2008 and it was very reasonable). Also, spend more time in smaller towns vs. cities. Great values in the French countryside, we found this still to be the case on out 2010 trip to France. There is so, so, much more to France than Paris. But if you just want to go to Paris -- consider a package trip booked on one of the major travel sights.
I would always say go. You really can't control the value of the dollar. When are you going? QE2 (Qualitative Easing 2), the FEDs effort to weaken the dollar, is scheduled to run out of money in June. The dollar may rebound somewhat after that.
Dear Ken, Wendy, Jeff, Terry, Randy, VS, and Brad, Thank you for your thoughtful comments. Very helpful. VS, do you have more specific recommendations as far as the countryside?
I agree with how Jeff does it I also pretend it is US dollars; I don't mentally convert each Euro transaction.
Travel when you can; years from now you won't ever say, "gee, I sure wish I HADN'T taken that trip to Paris!" but you may say the opposite...
Certainly, minimizing costs in Euro helps. I've found some things that help. Itinerary: There are a lot of interesting places in Europe. You don't have to limit your travel to multiple, famous, far-flung sites. Do a little research and find places near where you fly into. Travel only takes valuable time and money. Transportation: Forget renting a car. That's almost always more expensive. Avail yourself of public transportation. Before you jump for a rail pass, compare it to point-point tickets. You can usually find advance purchase discount tickets for less. Accommodations: You don't need four and five star hotel. They add to your cost. The best way to find economical accommodations, at least in German speaking countries, is town websites. They have a much better selektion of low cost places than the booking website.
"A few years ago, when the dollar was at a low versus the euro, many of the left-of-center posters here blamed George Bush. So, who is to blame now, I wonder?" Tom The day Bush took office, the Euro $1.02. When he left office the Euro was $1.46. Today is is $1.48.
The exchange rate is what it is. Life is too short to worry about it. Come up with your budget and plan accordingly. If your wait for the exchange rate to get better it could be too late. Go and have a great time. We just got back from a 10 day trip to Paris and loved every minute. Believe me, the memories we made will not include the exchange rate.
Thanks Frank, I had exactly the same reaction.
the exchange rate fluctuates so often, there is no way around it. putting your vacation on hold because you think you may save a minimal amount of money due to the exchange rate is just silly. instead, try to save yourself some money by using a credit card or a bank that charges less transaction fees. for example: capital one - no transaction fee
most credit unions - 1% that being said, I hopefully capital one will have the chip and pin technology for their venture cards sooner rather than later. such a pain in the arse without it...
As others suggested, go now. If/ when it changes for the better, go again! Pretend euro are dollars (within reason) while you are there so that you don't make yourself nuts. It is very unlikely that you'll reflect on the trip later thinking that going was a financial mistake...
Thank Bernanke and his ridiculous interest rate ruse. You can buy the FXE (which I did at the start of 2011') to hedge the dollar. In that, if the dollar DROPS in value vs the Euro (which is has done to the tune of 11% YDT) then you recover some lost dollar purchasing power via the FXE hedge. I would not expect any major reversals until this guy finally wakes up and raises the FED funds rate back where they belong.
I am leaving for Austria next week, and am feeling alittle angst over the exchange rate, too, but all I can really do on this trip, as in the past, is be mindful of my expenses. Instead of traveling around to a number of different places, I'm going to one place - Hallstatt - to settle down in a lovely B+B room overlooking the lake, and plan to do alot of hiking and relaxing in the area. As others have said, there's just no knowing if the exchange rate is going to go up or down. When I initially planned this trip, it looked good; now, not so good. Oh well. I'll just cut back on my daily strudel intake :)
Frank I am surprised that you needed Tom's explanation for his 'politicising' as it was obviously tongue in cheek, or at least that's how I read it.
Sarah - Just got back from a euro trip and, you are right, the dollar is tough. That said, go. Never let the exchange be the deciding issue. One thing to keep in mind: unless the item is local to where u r visiting, there really aren't many things to purchase in Europe. Since so much of the US and Euro goods (clothing, electronics, etc) come from Asia and the US market is much larger and, our tarrifs are lower, generally everything is much less expensive in the continental US (I see u r from Guam, so I have no clue about your local costs). Irish folks, by the droves, fly to Boston to go to malls here in the Boston-area (off price or first quality) just to go shopping. Sit back, sip that bellini and enjoy your visit. It'll be priceless
Sarah, I think VS was just referring to the 'fact' that smaller towns are typically cheaper than large, touristy, cities. Minimizing your time in cities can keep your costs down, BUT if what you want to do most in Europe is visit the Uffizi and Louvre and take a gondola ride, you won't get that in some tiny (and much cheaper) Breton village... As far as the exchange rates, they go up and down - seems like 2 up and 1 down LOL. The differences don't add up to all that much in the scheme of things. Worst case - maybe you cut one day off of your trip if there's a sudden spike and you're on a very fixed budget, or you eliminate some museum you were planning to visit, or you eat more bread and cheese and less restaurant meals. Oh, ummmm - don't actually eliminate any museums, just eliminate the trip to the museum from your itinerary...;-)
Hi Everyone! Well, I went! Thanks to your advice, I took my six year old son to Paris for three weeks in June. We had a great time. We stayed in the 6th Arrondissement and went to the Jardin du Luxembourg almost every day, the Jardin d'Acclimatation, the Cite des Enfants twice, a tiny part of the Parc de la Villette, le Jardin des Plantes, which I loved, the Tuilleries, a dinosaur exhibit, the Musee d'Orsay, the Louvre (our favorite! We went without a map and explored for hours at the fast pace of my six-year-old son, which was a surprisingly entertaining way to see the Louvre as it prevented me from getting bogged down trying to memorize who carved what), the Pompidou and of course la Tour Eiffel and l'Arc de Triomphe. We walked every day, ate the most delicious food of our lives, learned about being considerate of others in restaurants, took the Metro, the RER and some busses, went to the Gibert Joseph bookstore, bought a book for my son in French, had a single and mind blowingly wonderful piece of chocolate for 1.85 Euros, and delighted in everything there was to see on the way. People were extremely friendly, offering to speak English, to which I would continue to try to speak French to the best of my ability. It has given me a feeling of life. Thank you for your encouragement.
What a great post Sarah! SO glad to hear you and your son had such a good time! My son and I absolutely love Paris - he loved all the places you describe when he was young, and still now. Especially the Luxembourg Gardens and the Jardin D'Acclimatation. Thanks for letting us know how it went! : )
Thanks, Susan! :D