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You are here: Home / Archives for money

Report Card: Budget for Africa

June 21, 2010 By Danny

Africa was shockingly expensive. We expected that the touristy activities would be expensive but we underestimated the degree to this expense. True, eating in Africa can be cheap, lodging too, but that’s about where the cheapness ends.  We definitely could have spent less here, but we wanted to do the “big” Africa things: safari, Kilimanjaro, mountain gorillas.

IMGP3300A reminder of how all this works. Every dollar amount represents how much the two of us, combined, spent on the average day in a given country. Airfare to and from the continent (very expensive to get to Africa) is included in transportation in the totals line and aren’t applied to any specific country. As always, visa fees are included in miscellaneous. For more information visit our spending page.

A couple of generalizations about Africa before we go into detail about each country. Most people in Africa do not travel long distances, that means transportation exists only for people of means and people with money. In most cases the buses we paid for in Africa cost more money than their counterparts in Latin America but were less comfortable, more crowded, and more commonly broken down. The roads were awful meaning more trips to go shorter distances and very few routes had service available at night. Then the expensive fees (Park entrances mostly; to see wild game and hike Kilimanjaro for example) are extremely high….These fees basically annihilated any sense of “budget” we had for Tanzania and Uganda. Visas also add up, we spent $645 each in visas.

IMGP7805South Africa: We rented a car and took that through the entire country, Swaziland, Lesotho, and even Namibia. Having a car did increase our transportation costs but seeing as we traveled 12,000 kilometers (7,500 miles) I still think the expensive car worked out to be far cheaper than public transportation would have worked out to be. Additionally the backpacker friendly Bazz-Bus would have been even more expensive and greatly restricted where we could go. Having a car also allowed us to carry a tent and our own food, drastically reducing our lodging and food costs. Even still this was not a cheap country and prices felt very similar to prices back in the US. Internet was also expensive but the presence of a domestic middle class who enjoys their own national parks just as much as the foreigners means that those parks, and all our activities are that much cheaper.

IMGP3541Mozambique: We went here for one reason….to hide from the hoards of X-mas while soaking up rays of sunshine on a nice beach. We went there, stayed put, and even managed to hitch a ride back with some South African’s we met while there. Scuba diving did us in on the overall budget but most everything else was pricey on account of our location on a tourist beach. The expensive visas to enter didn’t help the budget either.

IMGP8855Namibia: Namibia was expensive because we spent the better part of every day in the car, driving and burning gasoline, and then sleeping in National Parks. On one park, Etosha, camping with our own tent cost about $55….quite absurd by our standards. This was an extremely expensive country to travel in with huge fees at the attraction you’ve already driven hundreds of miles to see. Even still, having our own car saved money and our little 2 wheel drive car handled the dirt and shale roads without a problem.

IMGP9845Zimbabwe: We managed to Couchsurf here in two of the four places we visited, joining our host and friends for a trip to Great Zimbabwe and traveling to Victoria Falls on our own. Traveling and staying with CSers helped our budget out immensely, especially with lodging. https://ishouldlogoff.wpengine.com/wp-admin/plugin-install.phpTransportation was still high where it was on our own, quite high actually, but it was quick and efficient when the police weren’t looking for bribes. Fees at Victoria Falls were significant but not awful. Our largest expense here was the purchase and shipment of beautiful soapstone artwork that was pulverized before reaching the US. 🙁

IMGP4188Malawi: Super cheap country and the only expensive thing here was the Scuba we did in the crystal clear waters of Lake Malawi.  We had a great time here and really enjoyed the chance to relax a bit. The reason miscellaneous is high is that we had to cross through Mozambique to get to Malawi from Zimbabwe and needed to purchase new visas; we applied those fees to Malawi rather than Mozambique.

IMGP0297Tanzania: Everything here is low except for activities. While on Safari and while climbing Kilimanjaro 100% of our food, lodging and transportation were covered in the overall fee for these activities. The true cost driver of these things were the park entrances (about $700 each just to climb the mountain in fees) so they throw our averages off a good bit. If we ignore the $100 visa fees and these activities we are closer to $90 per day, still high but in line with the rest of Africa.

IMGP0498Uganda:  Seeing the Mountain Gorillas is an expensive activity, period. (At least the gorilla pictures and videos are cool)You have to pay $500 per person just to see them and then because you have to book that permit with an agency you need to either pay their fees on top of that or buy their transportation package…due to a series of events we ultimately had to do both of those things. The rest of the country is super cheap though, one of the cheapest places we’ve been to and still a pleasure to travel in. Bummer that the waters of the White Nile are due to be dammed and there won’t be any more Ugandan whitewater in the future.

IMGP4472Kenya: Things could have been cheaper here but trying to keep to a schedule, treating ourselves nicely on the island of Lamu, and taking advantage of the presence of my cousin who could fly home from Nairobi with gobs of souvenirs led to us spending far more than necessary. There really isn’t anything wrong with any of that though… At least the corruption makes for a nice travel story.

IMGP1192Ethiopia: This is a very poor and a very cheap country. There is a reason it features prominently in hunger porn commercials and South Park jokes. We treated ourselves nicely while staying in Addis Ababa and even still this was our cheapest country of the entire trip thus far. Traveling in the backseat of an overland car rather than paying for buses probably contributed a bit to low transportation costs but not as much as moving slowly and relaxing a bit while waiting for visas to be processed.

IMGP2679Sudan: This is a cheap country, cheaper to travel here than in Ethiopia. We spent ten days and spent $88/day, that means $880 for the whole ten days. Five-hundred of that was paid to the government for visa fees and foreign alien registration. That means it really cost us about $38/day for two people. Everything was very cheap and Sudan had the cheapest gasoline we’d seen anywhere until we entered Egypt. A very filling meal could be had for two for less than one dollar but that didn’t stop us for cooking for ourselves when we were bush-camping in the desert.  Traveling with over-landers allowed us to do this and this country would have been a good deal more difficult without our friends in Kaspuur, the landy from London.

IMGP4915Egypt: We expected mass tourism and we absolutely found it here but were quite surprised at how budget friendly Egypt was. The sites were not outrageously priced to begin with but then we were given a 50% discount on pretty much everything thanks to our ISIC cards. Comfortable lodging was cheap, private, and generally included breakfast. Had we taken the train from Luxor to Cairo this would have been more expensive than driving but it would have saved two days of travel, one night of lodging, and a very annoying police escort.  There is a lot to do in Egypt and truly something for everyone and ever budget. Seeing the pyramids and then climbing Mt. Sinai were absolute highlights. We passed on the beaches and diving of Dahab because we really didn’t feel like beach time.

Jordan: This isn’t really Africa but we’ve grouped it in here as part of the ‘Levant.’ It was an expensive place and we made it worse by paying for expensive transport to save a couple of days getting between the border and Petra. Additionally, the boat to Jordan from Egypt was not a cheap excursion. This was our 29th country and the first where a unit of currency was worth more than one US dollar.

Israel: Just like Jordan, this is a super expensive place and really is not backpacker friendly. We spent 100% of our time visiting with friends and staying with them as well so our price figures really aren’t worthwhile to anyone traveling there independently. If you do plan to travel here with a backpack be prepared to pay prices that would be considered average to high in Western Europe or the USA.

Filed Under: Africa, Featured, Guides, Headline, Travel & Planning Tagged With: budgeting, money, spending

Faranji Pricing

April 28, 2010 By Jillian

I wish I could say that its uncommon for foreigners or tourists to be charged differently. All over the world people seem willing to take advantage of the newcomer, to see what boundary can be pushed, but never have we seen a tourist price so institutionalized.

IMGP4608Faranji pricing in Ethiopia is a way of business. While gringo pricing is common in Latin America, is generally understood that its a “starting” price from which to negotiate and almost no one will admit to a separate gringo price. That is just not the case in Ethiopia and often we’ve been presented with a bill that is different from what we expected. “Faranji price,” we’re told, as a matter of fact, expecting us to understand. Nothing frustrates us more than being charged differently because of the color of our skin or our nationality.

Recently we sat at an Internet cafe for a few hours, trying to catch up with some online administration. Although the price was set at .35Birr cents (about $0.05) per minute, when it came time to pay, we were charged .75 Birr cents a minute. Protesting the increase, we were told simply that .75 was the faranji price. Refusing to pay what we saw as an unfair increase due to our skin color, we argued that the practice of faranji pricing was unfair. “That’s how it is,” the cafe attendant said. In the end we refused to back down and after extensive discussions paid original rate.

What is right though? Should we act on a ‘when in Rome’ mentality and pay what is asked of us for should we stand up for the principles of equality and fair play that we grew up in and enforce in our own country? We’ll posted a new poll to this affect and are curious about your thoughts.

Filed Under: Africa, Ethiopia, Headline Tagged With: cultures, money

On our way to Zimbabwe!

March 8, 2010 By Jillian

All I knew about Zimbabwe before we arrived in Africa was that it was the country of the evil Mugabe. Shortly after starting the trip we met two travelers who had actually been there who told us when they left the government was unveiling the $750,000 note. We’d eventually heard the country had dollarized and was “more or less” safe but that still didn’t stop the majority of people from asking “why would you go there, you’ll be killed for your shirt!”

The concept of hyperinflation is interesting enough. When our friends traveled through, it was phase one of the hyper-inflated currency…a few months later the government knocked 12 zeros off the money and then started all over again before topping out at $100 trillion notes less than a year later. It was only when a new note came out that people understood the value of money…for that new note was generally the value of a loaf of bread.

Throughout South Africa, Zimbabwe is generally considered to be a nuisance. The very first border we crossed on this trip, between San Diego, USA and Tijuana, Mexico, was and is the busiest in the world. The crossing from South Africa to Zim, number two, as jobs and supplies push Zimbabweans toward South Africa in much the same way. You can tell from this picture, which was taken inside the ladies room on the South African side of the border, what people think of Zimbabwe’s Dollars!

Those same travelers who first told us of the hyperinflation of Zimbabwe back when we were in Guatemala had their own wonderful story of the country as well.

Although most people warned us away from this country, those who had been all told us the same thing; that it is stable, interesting, and filled with wonderful people. It is rare to hear comments regarding a “people” so often and so given that the best information we had suggested that it was safe…we decided to enter. Besides, there was no way I was coming all this way and NOT going home with $100 trillion to my name!

Filed Under: Africa, Headline, Zimbabwe Tagged With: border, money

Foodie Friday: sweets for money

March 5, 2010 By Danny

A long time ago when we first heard about traveling in Zimbabwe we heard of travelers bringing staples like sugar and rice into the country with them, to be used for barter. With the country going through hyperinflation, unable to trade for much in the way of anything, this was more valuable at the time than money. Before going to Zimbabwe we asked around a bit and were assured that markets were generally stocked and that things had stabilized but that didn’t mean that the barter economy hasn’t evaporated entirely either.

IMGP3300Zimbabwe is now the third country we’ve visited using the US Dollar rather than its own currency. Unlike the other two, Panama and Ecuador, Zimbabwe is far away from a steady supply of USD. Panama and Ecuador didn’t go through the same kind of hyperinflation Zimbabwe did and so it was simple for them to continue minting coins, called Balbao and Sucres, that were equal in value and size to US dollars and cents and used interchangeably. As Zimbabwe stopped minting valueless coins in the early stages of hyperinflation, a few years ago, they aren’t prepared to mint again and aren’t able to get real US coinage leaving the country constantly struggling for change. South African Rand has largely filled this void with one rand, a coin, accepted as 8-10 US cents.

But this is a post about food and although the money is the interesting part its not the whole story. Bring on the barter you could say, even in the supermarket. When in Victoria Falls our bill came to $4.14 cents at the supermarket. The cash drawer was empty and I only had a $10. I found a couple of rand in my pocket to cover the $0.14 as they found change for the rest of my big bill, but as I’d more than covered the $0.14 a couple of lollipops were thrust into my hand as change for my change. Although we’ve seen this in other places it had never really reached such an institutionalized level.

It didn’t end there though. Every time we went to any type of market, be it searching for Zim dollars or trying to buy some curio handicraft, we were asked what we could trade. This was new to us. All through the America’s when we balked at prices, those prices came down. Occasionally we had something that we offered to lower a price but it wasn’t common. Here in Zimbabwe though, it was expected and we were ill-prepared. So, if you’re headed to Zimbabwe in the relatively recent future make sure you come prepared with “change”: used clothes or other food to barter.

Filed Under: Africa, Food, Headline, Zimbabwe Tagged With: change, foodiefriday, money

Money Management – Credit Cards Take 1

October 28, 2009 By Danny

water-liliesPeople often ask us how we manage our money while we’re abroad. Do we just use cash, can we use credit cards, how much do we pay in fees, etc. Although we have a nice little page (ishouldlogoff.com/finance) devoted to how we do this, there are a couple of things left unsaid on that page.

Does it all work out as it should?

For the last 7 months we’ve been testing those financial products we’ve come to depend on to see if they do deliver as promised. We use a Schwab Visa card as well as a Capital One Master Card which both claim to not charge a foreign exchange fee. We also carry an American Express card and while my parents were visiting, my father was carrying another Visa card that made no such promises. Lastly, there is our Schwab ATM card which promises no foreign exchange fees in addition to no ATM fees.

To test if we are not being charged a foreign exchange fee by our credit cards we used all the cards on a single day in Argentina and have calculated the exchange rate we received, automatically, from each service. Since my father had his Visa card with him, we chose to test the Schwab Visa rather than the Capital One Master Card to determine whether Visa itself took a fee.

ARG / USD – 3.8395 Pesos USD Rate Variation
Schwab Visa ATM Card 1011.52 264.29 3.8273 0.32%
Schwab Visa Credit Card 30 7.86 3.8168 0.59%
Chase Visa (Marriott) 204 55.02 3.7077 3.55%
Amex (Starwood Preferred) 24 6.44 3.7267 3.03%

Using the rate provided for me by Yahoo! Finance (far better for these purposes than Google Finance, although not nearly as snazzy) of 3.8395 pesos per dollar on the day in question I’ve calculated the above exchange rates and their variation from that rate provided by Yahoo. As you can see both Schwab cards (the ATM fee is included in the calculation, Schwab will reimburse this at the end of the month) charged me a foreign exchange fee less than 1% higher than the rate reported by Yahoo. Amex was next cheapest at an even 3% and the regular Visa came in around 3.5%, about 3% higher than my Schwab Visa card.

First off we need to understand that I am a travel blogger without regular access to a Bloomberg machine nor did I ever work as an investment banker. Yahoo provides only one rate to me and I’m not sure if each card pulls a spot rate or a day’s closing rate or whatever other options might be out there. Basically I’m disclosing that all the numbers I provide are “close enough for government work” type numbers.

It looks as those Chase bank charges 3% more than Schwab bank. I think it is also safe to say that the 0.5% fee we see from Schwab (and therefore from Chase as well) is the foreign transaction fee charged by Visa and not by the bank. Nothing in life is guaranteed but death and taxes and this is yet another form of one of those taxes.

In its documentation, American Express claims a 2.7% foreign transaction fee. The fee I’ve calculated is slightly higher, I believe this may be a difference in fluctuating exchange rates if American Express pulls a spot rate. In fact, if I compare the AMEX rate to the exchange rate I received at the ATM rather than to the rate provided by Yahoo finance I get 2.7%. Additionally, this means that Visa itself may be charging somewhat less than 0.5%.

In summary it looks like my special ‘no foreign fee’ cards do deliver as promised. Chase is clearly a poor option, as I’m sure are most other banks’ credit cards. Hopefully I’ve not confused you but I have left several questions open.

1.Do Visa and MasterCard charge the same fee?
2.Does my Wachovia/Wells Fargo ATM card charge the same fee as my Schwab card?
3.How does CapitalOne’s promise compare to Schwab’s promise of no fees?
4.Have I made a grave error in proving to all of you that I’m a nerd at heart?

Future posts on this subject will aim to tackle numbers 1-3. Number four I fear, has already been answered. Please me know if there is something else you think should be tested or there is something obvious I’ve missed.

Filed Under: Headline, Reviews, Travel & Planning, USA Tagged With: credit cards, finances, money

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