Beyond the Sticker Shock

When I first moved to Australia in 2005 and exchanged my U.S. dollars and euros for Australian dollars, the first thing I noticed was how beautiful they were. Australian paper money looks and feels different than American paper money for three main reasons: the denominations are different colors, they vary in size, and for approximately the last thirty years, all the notes have been polymer. The plasticization, clear windows, and other security features make these banknotes almost impossible to counterfeit or rip. Currently an Australian dollar is worth 78 U.S. cents. When deciding whether or not to make a purchase, I mentally do the currency conversion by slashing 25%. That helps me see if the item’s price is fair or “worth it” to me. Despite the sticker shock that Americans legitimately feel with the smaller dollars and generally higher prices here, the colorful money is delightful.

In the 1960s, Australia established its own reserve bank and began to reform its commercial and central banking practices to reflect post-WWII political and economic realities. Australia adopted decimal currency, switching to dollars in place of pounds, shillings, and pence. Initial ideas to name the new currency “Royal” or “Austral” were shot down. Early banknotes featured not only the Queen in a nod to the link between the Commonwealth and the Crown, but were uniquely Australian and designed to emphasize Australian history and Australia’s independent economic contributions to the world.

Starting in 1974, printing on Australian notes that had been legal tender throughout the Commonwealth and its territories was updated and notes began to circulate just within Australia and its own territories. In response to inflation during the 1970s, the Reserve Bank of Australia introduced the $50 note, and the $100 note followed in the 1980s. The government has released at least four separate series over the years; many notes are still in circulation even if no longer printed, and all remain legal tender. I love how the bills’ designs include famous Australian people, colorful indigenous birds, Aboriginal culture, Parliament, and microprinting from the Australian Constitution and poetic lines like “No foe shall gather our harvest.”

The other day I bought something with a $10 bill, and the person exclaimed, “Oh, that’s a new ten!” I laughed because you couldn’t have proven it by me – it was still blue. I should probably look up all the notables on each bill at some point. Apparently a new $50 (Australia’s most-counterfeited banknote) will come out in 2018. I sure hope it stays yellow! Since late 2015, future banknotes should also include a tactile feature to assist the visually impaired.

$100 AUD = $78.14 USD

$50 AUD = $39.07 USD

$20 AUD = $15.63 USD

$10 AUD = $7.81 USD

$5 AUD = $3.91 USD

Looking at the above picture, Americans may be wondering, “Where’s the $1?” Well, Australia actually did away with their $1 note all the way back in 1984, replacing it with a gold coin. The $2 coin followed four years later. The other common coin denominations are a fifty cent piece, and 20, 10, and 5 cent pieces. That’s another thing – there are no “pennies”, so when you get a total (usually at the gas station) like $74.68, everyone rounds up.

I lined up the coins alongside a dollar bill for scale reference, since I don’t have any USD change handy. From left to right, you’ll see $2, $1, 0.50, 0.20, 0.10, and 0.05. Yes, the $2 is smaller than the $1. It’s weird, but it’s their money so they get to have it their way.

You can probably imagine the impracticality of how quickly the coins accumulate. You break a $20 bill to buy a sandwich, and all you get back is a $5 bill if you’re lucky, or a small handful of coins and you’re left wondering where the hell all your money went. Also, the $2 coins are the most valuable; although they may not look like much, they add up at $1.56 USD a pop! There are times I thought I had “some change,” but the pile I dumped out ended up exceeding 25 bucks. That’s money! With patience and a little organization, it all spends. With that said, Australians not having pennies is kind of awesome and progressive.

I am pretty good about keeping my coins in a Ziplock bag rather than letting them deform my nice pocketbook, and spending them in parking meters (which are everywhere here BTW, even at the movie theatre and grocery store!) or for food at the embassy’s cash-only cafeteria. My husband and I have Australian bank accounts and debit cards, but I choose to operate mostly on cash.

I have probably mentioned this previously, but in Uzbekistan, the economy functioned 100% on cash. While we were there, the largest denomination of paper money was officially worth about $1.75, so we joked a lot that we rolled with the Bank of Ziploc. My good wallet stayed in the safe, while I carried around a big local pocketbook that expanded several inches to accommodate all the dirty stacks of soum. Every time I traveled outside Uzbekistan and could use a card, it felt like I was back in the real world where international finance connectivity exists.

Obviously in Australia, the banking is much more advanced than Uzbekistan’s and provides extensive options besides cash. In fact, unlike in the U.S., here we have chip and pin, and can just “wave and tap” our debit cards to pay everywhere from the grocery store to restaurants. Often when I pull out cash, the vendor looks momentarily surprised before hitting “cancel” on the point of sale device. My nail salon even offers a 10% discount for paying in cash. Yes please!

So, how does money management work for me here? I get paid in U.S. dollars directly deposited into my American account. I write occasional checks to the embassy from that U.S. account, and the cashier converts it to Aussie cash for me without charge. Then I deposit some of that cash in my Australian account to pay local bills, and keep the rest on hand for gas, groceries, personal and household expenses. So far, that system works pretty well! It is a lot easier here than in Uzbekistan to just… do everything, find everything, accomplish everything. In Uzbekistan I paid for our gas, cell phones, and home internet through the embassy commissary because between the language barrier, the local mail system, and the tedious slowness and overall lack of service, it was the best way to get things done. Here things work well, so you need and get less embassy support, but I truly can’t complain.

Yesterday marked five months in Australia, and for the *first time* I finally shopped for clothes. I am not a big shopper and am very choosy about what comes into the house. I also already have a lot of nice clothes, however, most of them temporarily don’t fit since my health has been a challenge. Thus, I semi-desperately needed a couple of items after wearing a very limited wardrobe for the last year… and I paid 100% in cash. It felt good to re-break the ice with Australian shopping and feel like an independent woman who is strong and on the go again.

Happy holidays to you and yours!

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