Cash Smarter

August 4, 2017  by: Aaron Crowe

5 Things I Love About How Europe Deals With Money

5 Things I Love About How Europe Deals With Money

My family recently returned from our home exchange in the Netherlands for most of July, and even though we saved a lot of money by not having many hotel bills to pay, we still needed cash each day on our vacation.

Cash is just a lot easier to deal with, especially with small merchants, and businesses seem to appreciate using cash instead of a credit card. The good news was that our travel savings account was pretty full before we left for Europe, so paying for our food, a few hotel nights and incidentals was easy. It was easy, however, until we had to find an ATM to withdraw money.

I’ll get to that mess in another post, but first I want to go over the good things I discovered about how Europe deals with money. Here are five things I found to be smart in France, Belgium and the Netherlands in how they deal with money:

Tax and tip included in the price

This was one of my favorite things about buying anything during our vacation: The price you see is the price you pay.

If the price says €7, you pay 7 Euros. Not €7.63 or some other odd amount because tax is added later. The price includes tax. At restaurants, it includes tax and tip.

You don’t have to do any math at a restaurant table to figure out a tip because it’s included in the price of everything in the menu.

The effect may be more psychological than anything, but it made reading a menu or seeing the price for anything — such as a €75 two-hour boat rental on a Dutch canal — easier to accept than seeing €60 and then adding €15 in taxes. At €60, I’d have my mind set on that price and would be unpleasantly surprised when it was upped to €75 after taxes.

No digging for pennies

There were a few exceptions to the above rule, and I never did figure out why. A few times I bought a bottle of water at a convenience store and the €1 price would become €1.09 at the cash register. I’d have to dig for pennies in my pocket when this happened.

But this rarely happened because most businesses didn’t add taxes at the cash register. Almost everything I bought didn’t require change because it was priced at the nearest Euro. Instead of €2.20 for a soda — orange Fanta was popular — it was €2 even.

And in the rare times when it was an odd amount — such as €1.53 for a bottle of water — the cashier was fine with €1.50 if I didn’t have any pennies on me. That happened a few times, where the bill was €1.05 or something like that and they were happy to take my 1 Euro and didn’t want me to have to break a €5 note for the rest. That has never happened to me in the U.S., where I’m constantly carrying around pennies because every business still wants them.

Coins instead of paper money

As someone who doesn’t like carrying a pocketful of change, I was surprised to discover that it was easier to pull change out my pocket than dig into my wallet for small, daily expenses.

Why? Because the coins there make sense. There are €1 and €2 coins, along with the regular 50, 25, 10 and 5 cents, and even 1 cent if you want to get wild.

The coins aren’t heavy or gigantic, so carrying €10 or so in your pocket is easy. Buying a snack or tram ticket is easy with change. In fact, the train stations in the Netherlands only took change and not paper money if you want to pay with cash. A sort of debit card could be used, but only if it was tied to a bank in Holland.

Waiter carries a cash register in his pocket

This is another ingenious way they deal with money in Europe. A restaurant table is yours as long as you want it, so you have to ask for the bill when you’re ready to leave.

Instead of having to wait for the waiter to bring the bill, return to get your money and then return with the change or credit card receipt for you to sign and figure out the math for the tip — the waiter comes to your table with a hand-held credit card reader and you pay the bill on the spot.

If you’re paying in cash, they have enough cash on hand to give you change. No waiting around for your big bills to be broken and you don’t have to do any calculations.

I’ve never paid a restaurant bill so easily in America and doubt this will ever catch on.

Escaping the VAT on big purchases

I don’t pretend to understand how the VAT, or Value Added Tax, works in the European Union or how to get around paying it as a tourist. From my limited understanding, you can get back this tax — 20 percent was common in many of the things we bought — by filling out forms, keeping receipts and mailing them back to Europe after you leave the country.

But you can’t get a refund on small purchases, no matter how much they add up to. On large purchases, however, the retailer should make it easy for you to escape paying the VAT.

We bought a Christmas decoration at a store in Bruges for about €300. When I asked how much it would cost to ship it home to the U.S., the saleswoman told me it would cost about €75 in shipping. However, they could fill out the paperwork for me so that I wouldn’t have to pay the 20 percent VAT on the item.

That basically canceled the cost of shipping, making it an affordable purchase.

As the saleswoman explained the VAT to me: “We take better care of you as a foreigner with the VAT than we do of our own people.” She wasn’t a fan of the VAT and was using it to sell souvenirs.

A saleswoman at a Delft pottery shop wasn’t as opposed to the tax, telling me that it was a tax on all goods in Europe, though she still used the VAT deduction for tourists as a point in trying to make a sale. Erasing the VAT would essentially pay for shipping, she said, though that still wasn’t enough to convince me to buy any Delftware.

Want to try a home exchange like my family did to save money money on lodging during vacation? Click on the ad below to learn more.

0 likes Personal Finance , Travel # ,
Get The E-Book
learn to
be the
expert in
your field
Fill out the form below to get the book FREE as well as updates from

Recommended by MyFinance

Share: / / /
Search All Articles