6 Things You Need to Know About Money Before Traveling to Costa Rica
Are US dollars Accepted in Costa Rica?
US dollars are generally accepted by merchants in Costa Rica. In fact, many Costa Ricans hold their savings in dollars due to the currency’s stability and status as an international reserve currency.
However, that doesn’t necessarily mean that you, as a traveler, should always use dollar throughout Costa Rica.
What is the Exchange Rate in Costa Rica?
In the past few years, the exchange rate for US dollars (USD) to Costa Rican colones (CRC) has varied between 530 to 570 colones per dollar. In September of 2019, the colon began a period of devaluation against the dollar. It is now trading between 600 and 606 to the dollar
You can check the most recent exchange rates here:
What is the Best Currency to Use in Costa Rica?
It is best to pay for goods and services in the currency in which the price is quoted. For goods and services that are marketed to North American tourists, prices are often quoted in dollars. Pay for those in dollars. However, for most products and services for sale in Costa Rica, like a bottle of water in the local pulperia (convenience store) or a delicious casado lunch in a local soda (a workingman’s lunch at a local mom & pop restaurant), the price is quoted in the local currency, colones. You will save money by paying for these things in colones.
Some “experts” would say that a US traveler should use the US dollar when in Costa Rica. After all, dollars are widely accepted and it is easier to not fuss with the trouble of mentally converting values in order to understand how much money you are spending. And, that is fine if you are limiting your trip to explicitly tourist-oriented areas. However, if plan to venture off of the well-beaten tourist path at all, it is best to have colones in your pocket, because it will save you 20% to 40% or more.
When you buy something with dollars that has a price quote in colones, then the seller has to make an on-the-spot currency conversion calculation. You, as the buyer, and the visitor will never end up on the good end of this calculation. Assuming that the conversion rate on the day that you are making the transaction is 600 colones to the dollar, there are good odds that the seller is going to convert your dollar to (at the most) 500 colones. You have immediately lost 20% in the conversion!
TIP: Pay in whatever currency the price is quoted.
What is the best way to change dollars, pounds or euros to local colones?
Avoid the currency exchange kiosks in the airports. They offer rates that are unfavorable to you.
The two best ways to change dollars, pounds or euros to colones in Costa Rica are:
Exchange them in a bank
Get them from a local ATM
How to Exchange Dollars, Pounds or Euros to Local Colones
There are banks all over the place in Costa Rica. Even most small, isolated towns have at least one bank location. There are three banks that are state-owned, Banco Nacional de Costa Rica, Banco de Costa Rica (BCR) and Bancrédito. These three banks are required to offer money changing services to the public (including travelers). The private banks, including BAC, Scotiabank, and Citibank; as well as the Costa Rican equivalent of credit unions (called cooperativos), may restrict services to only account holders.
TIP: Find a Banco Nacional, Banco de Costa Rica or Bancrédito to change money, because they are obligated to serve everyone.
For security reasons, you will be required to remove any hats and/or sunglasses that you may be wearing. The security guard at the front door may ask to look inside of any bags that you are carrying.
Upon entering, you will need to tell the security guard the purpose of the visit. Most guards will understand if you simply say “change dollars.” You can also take this opportunity to try a little Spanish by saying, “necesito cambiar dolares, por favor” (I need to change dollars, please).
The guard will either direct you to a line for the cajeros (tellers) or, he or she will direct you to take a number from the machine that dispenses them.
Once you reach the teller, you can use your Spanish phrase above, or simply present your dollars and say “colones, por favor.”
The teller will ask for your passport. Once you present it, with your money to change, and the teller inputs the information into his or her computer, he or she will count the bills that you present and confirm the amount.
You will then receive colones, exchanged at the current rate, along with a receipt that details your transaction.
Congratulations, you just saved 20% or more.
How to Get Colones from an ATM
If you know how to use an ATM at home, then you should have no problem using an ATM in Costa Rica. In fact, many ATMs give the option of using them in English.
If the ATM offers both dollars and colones (many do), then obviously, you need to select colones.
Like ATMs at home, you may be charged a fee (usually around $1 to $3) for using the ATM, plus your bank at home will probably charge a 1% to 3% foreign transaction fee. While this is less than ideal, it is still better than the 10% or more than you would be paying if you paid for everything in dollars.
If you frequently travel internationally, you might want to investigate accounts with no or low transaction fees, such as the Schwab High Yield Investor Checking.
Before you go, make sure that you advise your bank that you are traveling to Costa Rica, in order to avoid complications in using ATMs and/or your debit card.
Do I need cash in Costa Rica?
Even though debit and credit cards are widely accepted in Costa Rica, it is best to carry at least a little folding money. Power and internet outages that affect card machines are more common than you may be used to.
If you are traveling to Costa Rica with US dollars, here are a few suggestions that will make your trip easier in regards to your cash:
Don’t bring $100. These bills are the most commonly counterfeited. They are carefully scrutinized and often rejected, even at banks, due to small defects such as normal wear and tear.
Speaking of, make sure that the bills you bring are in good shape, with no tears or extraneous markings.
Keep your cash in various secure places on your body. We recommend keeping some cash in a money belt under your clothing, as well as additional cash hidden in an external belt with a discreet money compartment.
Fortunately, colones are easy to manage. There are six bills. Each bill is a different color. They are all the same height but they vary in length depending on value. The longer the bill, the higher the value.
The bills are:
1,000 colones bill
This bill is often referred to as a “rojo,” because of its red color. It is the shortest bill, at 125 mm. It is worth approximately $1.80 USD.
This bill is blue and is worth about $3.60. It is 132 mm long.
The 5,000 colones bill is yellow. It is sometimes called a tucan (or toucan) because in earlier versions, this bill featured a prominent image of a bird. It is worth about nine bucks, US.
This bill is yellow, is 146 millimeters long and is worth about $18 USD.
The 20,000 CRC bill is orange and is 153mm long. It is worth about $36.
The rare, 50k colones bill is purple or violet and is worth about $90.
Is it expensive in Costa Rica?
Costa Rica is among the most expensive countries in Latin America. However, it is possible to enjoy yourself on a small budget.
Generally speaking, the prices of goods and services fall into two main categories:
Meant for foreigners and/or imported
Meant for locals and/or made domestically
Goods and services in the foreigner/imported category are usually expensive and those in the local/domestic category are inexpensive.
The key to enjoying Costa Rica on a budget is to stick to the local/domestic category as much as possible.
For lodging, this means, look for inexpensive AirBnB rentals, where you will stay in the home of a local person. There are AirBnB rentals available in popular areas such as Playa Hermosa and Puerto Viejo de Talamanca for $20 or less per night. If you are more adventurous, there is always Couchsurfing.
For food, eat like the locals. Grab fresh fruit at the local central market. A meal of beans and rice with a small salad, plantains, meat and a drink can be had for around 3,500 colones or $6 USD.
If you have more time than budget, then get around the country via bus. The country has a robust system of buses that crisscross the country. While the bus system can be a challenge to understand, especially if you know poco Spanish, the time invested in understanding it can save you a lot of money.
There is an active Facebook Group, called Costa Rica by Bus, that shares valuable information on how to get around inexpensively via bus.
Most service-oriented businesses, such as restaurants, already include a 10% service charge on the tab. In local-oriented restaurants, tipping is not expected. However, in areas that cater to foreigners, gratuity is often expected.