Is it better to pay with US dollars in Mexico?

While it is possible to use US dollars to pay for tours, tips, and even accommodation, you will need Mexican currency for cash transactions in Mexico. In places that do accept physical U.S. dollars, such as hotels, using them may result in very unfavorable exchange rates or additional fees.



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Credit cards are widely accepted at most places of business throughout Mexico, especially in tourist areas. Besides small towns and certain food trucks or shops, you can use a credit card to pay for most things.

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A credit card will make the most sense for larger purchases and you'll likely need one for hotels. You'll always need cash to make everyday purchases.

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The best currency to take to Mexico is the local currency, the Mexican peso. US dollars are also highly exchangeable at local banks and currency exchange offices. However, instead of converting physical banknotes, the cheapest way to pay in Mexico is to use a multi-currency travel debit card like Revolut or Wise.

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It's recommended that you buy pesos before you land in Mexico, just in case you need the cash. According to this USA Today article, the most economical way to do this is to buy pesos from your bank in the U.S. Most banks will do this for free, especially if you're not withdrawing a significant amount of money.

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Follow the 25% rule regardless of how many days you will be in Mexico. For example, if your total budget for a seven-day vacation is $1500USD, you should bring a total of $375USD or $7,000 MXN. This totals about $50USD in cash per day.

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The best way to spend in Mexico is a combination of both cash and your debit card. Larger businesses and those in major cities are likely to accept debit cards, but not all will. Some smaller stores and businesses may only accept cash. For example, market stalls, street food stands and taxis.

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So, how much spending money should I bring to Mexico? On a mid-range budget, you should expect to spend $110 USD ($2200 MXN) per person daily. This accounts for 3 meals a day, transportation fare, and one activity per day(tours, attractions,etc.). Add $10 USD ($200 MXN) if planning to drink alcohol.

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For traveling (even on a backpacker budget) it is perhaps better to consider what 500 pesos (or $25 will buy). That is enough to rent a car for a way (minus non-specified expenses). It is also enough for dormitory accommodation in some of the cheapest hostels in Mexico City for two nights (around $8 per night).

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Deciding where to go and what to pack is stressful enough, let alone trying to determine how much money you need to bring. The general consensus is that you should have $50 to $100 in cash per day for each traveler.

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What is this? The good news is, in certain parts of Mexico it's still possible to live and travel on just $500 a month! It's even possible to live in Mexico comfortably on $500 per month, as long as you plan your trip correctly.

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It's up to you how much you tip, but the recommended amount in Mexico is between 10% – 20% (15% is a good standard in tourist areas) of the bill or ticket price.

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