Money on a Package Tour: Cards, Cash and Tipping

The big money on a package tour changes hands weeks before departure. What is left for the trip itself is meals, optional activities, drinks, souvenirs and tips, and these are almost always handled in a mix of local cash and cards. Getting the mix right is a matter of knowing the region, the group format, and a few traps that are the same everywhere.

Cards: carry two, from different networks

The standard advice holds: at least two cards, ideally on different networks, kept in different places. A card that is blocked, swallowed or declined is a nuisance when there is a backup and a crisis when there is not. On a group tour the leader can sometimes advance cash in an emergency, but that is a favour, not a service.

Multi-currency travel cards, whether prepaid or linked to an account, are a category worth understanding. They typically let you hold several currencies and convert between them at or near the market rate, with low or no foreign transaction fees on spending. Their weaknesses are usually at the ATM, where a monthly free withdrawal limit is common before fees apply, and at merchants in countries where the card network is less accepted. Ordinary bank debit and credit cards vary widely in what they charge abroad; the fee schedule is in the terms, and it is worth reading before the trip rather than on the statement afterwards.

• Tell the card issuer the travel dates if the issuer still asks for that; many no longer need it, but a blocked card at the first ATM is a bad start.
• Know the daily withdrawal limit and whether it can be changed in the app.
• Keep the issuer's lost-card number somewhere other than in the wallet.
• A credit card in the bag as a pure reserve, unused unless needed, is a reasonable third layer.

The dynamic currency conversion trap

At many card terminals and ATMs abroad, the machine offers to charge you in your home currency rather than the local one. This is called dynamic currency conversion, and it is almost always the worse choice. The rate applied is set by the terminal operator and typically includes a mark-up well above what your own card issuer would apply. The screen often presents the home-currency option as the safe or recommended one, sometimes with wording that suggests the conversion is a guarantee. Decline it and choose the local currency every time. The same applies to hotel bills and shop payments where the staff ask which currency to charge.

ATM strategy

The efficient pattern in most places is fewer, larger withdrawals rather than many small ones, because ATM fees are usually per transaction. The constraints on that pattern are the machine's own limit per withdrawal, which in some countries is low, and the risk of carrying a large amount of cash. On a group tour the practical answer is to withdraw enough for the next stretch of the itinerary between reliable ATMs, which the tour leader can usually identify at the first briefing.

• Bank-attached ATMs, inside or beside a branch, are generally safer and cheaper than standalone machines in tourist streets.
• Airport ATMs are convenient on arrival but often carry higher fees; a modest first withdrawal is enough until the city.
• In remote areas assume there is no ATM. Rural Morocco, the Peruvian Sacred Valley beyond the main towns, the Serengeti and the Patagonian interior all involve days without one.
• Check the machine for anything loose around the card slot and shield the keypad; this is basic but effective.

How much cash per day

There is no single figure, and any article that gives one is guessing. The variables are what meals the tour includes, how many optional activities you intend to do, and the cost level of the region. A rough way to think about it by region, without attaching numbers:

• Southeast Asia (Vietnam, Cambodia, Bali): cash still dominates for street food, markets, small shops and tuk-tuks. Daily cash needs are modest in absolute terms but nearly everything outside the hotel is paid in it.
• Morocco and Egypt: markets, taxis and small restaurants run on cash; cards work in hotels and larger restaurants. Bargaining is expected in souks, and small notes are essential.
• East African safari circuits: most of the trip is prepaid; cash is for tips, drinks at the lodge and craft markets. Lodges often accept cards but the network can be unreliable.
• South America (Peru, Patagonia): mixed. Cities are card-friendly; small towns, markets and many optional-activity operators want cash. Some places quote in a hard currency and accept the local one.
• Japan: historically cash-heavy, now card-friendly in cities and at chain shops, with cash still needed at many temples, small restaurants and rural stops.
• Iceland and Western Europe: cards work almost everywhere, including for tiny amounts, and many travellers finish the trip with unspent cash.

A workable method is to count the uncovered meals and optionals on the itinerary, ask the operator for the typical local cost of each, and add a margin for drinks, transport and small purchases. Then hold roughly two or three days of that in cash at any time in cash-heavy regions and less elsewhere.

Tipping: how operators quote it

Tipping is the part of tour finances that causes the most quiet anxiety, because it is expected, unpriced and socially awkward to ask about. Operators handle it in one of three ways, and the itinerary usually says which.

• A tipping kitty. The leader collects a fixed amount per person at the start, holds it, and tips local guides, drivers, porters, restaurant staff and hotel staff from it as the trip goes. The tour leader is usually not paid from the kitty. This is common with small-group operators and removes most of the daily awkwardness.
• A suggested daily amount, quoted in the pre-departure notes, for the leader and sometimes separately for the driver. It is presented as guidance, and it is paid at the end of the trip, usually in cash and usually in an envelope.
• No guidance at all, more common with private-driver packages and local day-tour suppliers, where the expectation is set by the destination's norms.

A kitty is not a compulsory charge, but declining to join one in a group that has all paid in is awkward and rarely done. If the itinerary mentions a kitty, budget for it as part of the price.

What is commonly expected

Expectations vary by country and by role, and any figures should be read as typical ranges rather than rules. Many operators suggest a per-day amount for the tour leader that works out to a small fraction of the daily tour cost, with a lower amount per day for a driver who is with the group throughout. Local guides who join for a single site or day are commonly tipped a smaller amount per person at the end of that visit. Porters on trekking routes such as the Inca Trail are customarily tipped as a group at the end of the trek, often with the leader coordinating a collection and a distribution; operators that take porter welfare seriously usually publish guidance on this.

Restaurant and hotel tipping follows the destination, not the tour. In Japan tipping is not customary and can cause confusion; in the United States it is expected; in much of Europe rounding up or a small percentage is normal; in Southeast Asia small tips are appreciated but not assumed. The tour leader's first briefing is the place to ask, and most leaders answer plainly.

Small notes: the logistics nobody mentions

The most consistent practical difficulty with cash on a tour is denomination, not amount. ATMs dispense large notes; tips, toilets, market stalls, tuk-tuks and street food all need small ones. Breaking a large note at a small stall is often refused, and paying a small tip with a large note either overpays or creates an expectation of change that may not come.

• Break large notes early at hotels, supermarkets, petrol stations and larger restaurants, which can give change.
• Keep tip money separate from spending money, in a different pocket, so that it can be handed over without opening a wallet.
• In countries where a hard currency is widely accepted for tips, clean and undamaged notes in small denominations are useful; torn or marked notes are frequently refused.
• Coins are rarely useful across borders and are hard to exchange; spend them before leaving each country.

Multi-country tours and leftover currency

Tours crossing borders, such as Peru into Bolivia or Cambodia into Vietnam, create the problem of leftover cash that is hard to exchange once out of the country. The usual approach is to withdraw conservatively in the last two days before a border, spend down at the final stop, and use cards where possible until the next country. Border-town money changers exist, but their rates and their honesty vary.

A short list for the money belt

• Two cards on different networks, stored separately.
• A reserve of a widely accepted hard currency in small, clean notes, for emergencies and, where customary, for tips.
• Local cash for two or three days, broken into small notes as soon as possible.
• The tipping kitty amount, if the operator uses one, set aside before departure.
• A note of the card issuer's emergency numbers, kept outside the wallet.
• A habit of choosing local currency at every terminal and ATM, every time.

Tour finances are simple once the format is understood: know how the operator handles tips, know where the cash-only stretches are, refuse dynamic currency conversion, and keep the small notes coming.