As recently as last spring, American tourists traveling to Europe had to cope with inherently high expenses. A €15 ticket to the London Tower, for example, cost the average American tourist $21. One year later, the same ticket only costs $17.
The reason? Due to the rapidly shifting European economy, the value of the Euro has changed significantly. And as you might guess, the lower conversion rate can have a significant effect on tourism, and your next trip to Europe in particular.
Why The Euro Exchange Rate Matters
Forgive us for doing some math here. But by the end of this paragraph, you'll understand just how vital the Euro exchange rate can be to your travel plans. In March 2014, U.S. travelers had to count every Euro as $1.39. Fast-forward a year and a half, and that number has dropped to $1.13. That difference of 27 cents for every Euro means that a €5000 trip is now $1,350 cheaper for U.S. citizens than it would have been only 18 months ago.
Of course, everyone would love to take advantage of better rates! But doing so is more difficult than you might imagine. Still, there are a few things you can keep in mind and do to ensure that your trip will be helped, not hurt, by the Euro exchange rate.
Time Your Trip
This is the most important part of using the Euro exchange rate to your advantage. The scenario above is the perfect example: Is waiting 18 months (or even 6 months, which ended up being a difference of 10 cents, or $500 for the same €5,000 trip) worth saving significant amounts of money? For most travelers, the answer is an emphatic yes.
Alternatively, would you rather go to Europe sooner if there is a good chance you'll save money? Of course, the answer to that question is even more clear. In fact, we (and the Guardian) would venture a guess that the falling Euro exchange rate is precisely why the continent has seen a recent surge in tourists.
Timing your trip can be a vital money saver for any tourist—US citizen or otherwise—planning to spend time in Europe. But just how do you time your trip? Chances are you're not a financial expert, and simply don't time to analyze financial trends that lead to exchange rate fluctuations. For most travelers, some guess work will be necessary.
But that doesn't mean your guesses can't be educated. The exchange rate fluctuates based on the relative strength of the countries involved. Europe's stagnating economy combined with a stronger-than-anticipated US economy to make the recent surge in the value of dollars vs. Euros possible.
A basic understanding of economies, which can be gleaned from watching or reading the news, can go a long way toward projecting exchange rates. And for added information, don't hesitate to check charts like the one from XE we linked above to look at which direction the exchange rate has been trending.
Stay Updated During Your Trip
Of course, timing your trip isn't the only thing you can do to maximize your resources by paying attention to exchange rates. During your trip, you might want to keep paying attention to these exchange rates, especially if you're planning to stay in Europe for an extended amount of time.
Then, adjust your money management accordingly: book the big trips (or your long-term car rental), withdraw funds, or make large purchases while the exchange rate is lower. You already know you have to bring back souvenirs, but does it really make the most sense for your budget to buy them toward the end of your trip, as most tourists tend to do? The individual savings may be small compared to the large expenses of your trip, but they will add up to generate significant savings.
And that's precisely why keeping up with the Euro exchange rate matters for tourists everywhere. If you're traveling to Europe before the end of this year, there's at least one thing you won't have to factor the conversion rate into, and that's your rental car. In fact, we currently have spectacular fall specials available for vehicles booked before the end of October!
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