Updated for 2015!
A handful of optimists out there are saying the Great Recession is winding down. But for many of the penny-pinching masses life still isn’t all caviar and yachting. Quite the contrary—budgets are still very much in fashion and people are asking where is the US dollar worth the most for travelers?
To help those who are augmenting their travel funds with gourmet ramen noodle dinners, I’ve put together a list of top places where the US dollar will make the most noise, the ones with the highest bang-for-buck quotient.
So where is the US dollar worth the most?
The website Saving For Travel has built an interesting tool to help travelers know what expenses will be like in what countries. Since people’s traveling styles differ vastly, it makes calculating an accurate “daily expense” number nearly impossible.Generally speaking, your first-world money tends to deliver best results in developing nations, places like Central America, South East Asia, Eastern Europe and India, where the local economy must support people who make less money. Of course some will argue that traveling to these places creates an ethical disparity (are you contributing to the economy only to take advantage of it?) but I tend to disagree — most of these places are downright stunning. Even with all the uneasy philosophical arguments, in terms of traveling experiences cheap countries really can’t be beat.
So to tune their figures, they’ve slated that budget traveling should consist of hosteling and eating as cheaply as possible on a daily basis. They also warn against budget-killing with “minor” splurges. In other words, take the following numbers with a grain of salt if you sometimes travel large.
- India: $22 – the dollar has been buying good rupees since 2012 so your money still goes a long way here. Plus, even with unfortunate news headlines, India has been strong on many top 10 lists this year.
- Laos: $22 – It’s more developed with every new backpacker but Lao can still be insanely cheap for people looking in the right places. Sidestep the parade by going south and enjoy the country’s 80% Buddhist population.
- Burma: $22 – Hot on many a traveler’s top 10 list, Burma is a must-go destination. Plus your American money will take you deep into the country.
- Cambodia: $23 – the Cambodian currency is widely sidelined for the dollar, but that dollar will go a long way. Rooms can still be as cheap as ten bucks a night (in the city) and meals can be $20, for an entire party of 5.
- Indonesia: $23 – Outside of Bali (which is 99% of the country) things are easy on the pockets.
- Bolivia: $23 – the dollar has held steady here, so trust in affordable prices for some time. And don’t forget, the country is an adventure lover’s playground.
- Honduras: $23 – The political situation is coming around, but for tourists, the coast has always been clear.
- Philippines: $23 – Beaches, history, solid tourist infrastructure, near perfect weather and the power to make a fully affordable stay give the Pacific archipelago a definite edge.
- Peru: $25 – Outside of the major tourist areas (Machu Picchu) your money’s going to go far. Try exquisitely pretty places like Puno or Arequipa.
- Vietnam: $25 – it’s still very affordable to travel in Vietnam. A few years ago dong devalued dramatically and the dollar has held strong against it ever since.
- Bulgaria: $25 – Probably the cheapest eastern European destination. Plus it’s just lovely.
- Croatia: $26 – A growing tourist trade has made the resort towns more expensive over the last few years, but meals, accommodations and transportation are a breeze. Flying in and out can be dicey, though. Check for nonstop flights from London or Barcelona, or take the ferry from Italy!
Also on par with Bulgaria and Croatia in per day expenses: Romania, Tanzania, Ecuador.
Here are a few industrialized countries’ costs for comparison:
- France: $42
- USA: $44
- UK: $54
But even with these levels, the dollar has been making some headway against the euro and pound. Look for the trend to continue.
The Big Mac Index
A good indication of the value of the US dollar versus other countries’ currencies is what The Economist once termed the “Big Mac Index”. Since the McDonald’s Big Mac is ubiquitous these days, it was a perfect and, um, digestible way to measure the purchasing power of the dollar against other currencies.
This chart can be used to gauge, however metaphysically, the value of the dollar around the world. Note on the chart: if you’re hungry in Norway, do NOT go to McDonald’s.
The Economist has a new interactive model for this chart which gives further information about the Big Mac Index.
Exchange rates have a lot to do with how far your dollar will take you.
Generally speaking the more of a currency you can buy with your own (relative to its history) the better chances you have of making it last longer in that place. Take a hotel night in Paris for example, that cost doesn’t change, but when the dollar buys more Euros you can buy more nights.
If the dollar goes into decline against foreign currencies it won’t take you as far, and vice versa.
For budget travelers if the dollar declines you have two choices:
- Hedge the dollar’s decline by traveling sooner than later, so that you use its current standing before it declines farther.
- Or, wait until you see signs of a recovery.
Fortunately, it can go the other way too. Look for signs of recovery and travel to those places where the dollar buys more local currency.
But doesn’t have to follow that the enjoyment of your trip should hinge on such arcane economic politics, but it can affect your finances, especially at foreign ATMs. Get back at the bankers by taking advantage of the above low-budget destinations.
There’s also a great website called Numbeo.com that gives staple item costs to compare countries against each other to help let you budget easily.
And don’t forget, there’s a wealth of other factors that can contribute to prices and how far your money goes: hotel vacancy rates, political turmoil, price wars, special events. It goes to say that you can always find travel deals to make traveling absolutely budget friendly.
For further reading pick up Tim Leffel’s book, “The World’s Cheapest Destinations, 21 countries where your dollars are worth a fortune”. Also here’s some more great destination suggestions by Budget Travel Magazine.
Feel free to leave your comments for alternative locales where you money will get you further!