Do I need a Mexican bank account or can I just use my home country credit and debit cards?
The answer really depends on how long you plan to be in Mexico and what you plan to do with your money. If you’re going to be there long-term and want to buy property or build up a credit history, then yes, you will probably want to open an account. Opening a Mexican bank account also gets you the best exchange rate on your money.
If you only plan to be in Mexico short-term (or as a snow bird), then no, it may not be necessary to open a Mexican bank account (which you need residency to do anyway). Your credit and debit cards will work just fine at most banks and shopping locations. The only issue is that you will always be paying high fees for cash withdrawals and currency conversions. So keep this in mind. It may be useful to come up with a cash budget and make that currency exchange or transfer one time (or as few times as possible) to save money on all the conversion fees (which can really add up).
How do I open a Mexican bank account?
First, you will need either temporary or permanent residency to open a bank account in Mexico. You will need to do this in person, at any retail bank location. You will also need to have a valid form of identification (passport or driver’s license) as well as your proof of address (such as a utility bill with your name on it). U.S. or Canadian citizens (as well as corporations) can choose to bank in either dollars or pesos. Banking in pesos will help you get the best exchange rate on your money should you continually send funds electronically from your home bank to your Mexican bank.
The top three Mexican banks (by assets) are BBVA Bancomer, Banorte, and CitiBanamex. There are also credit unions in Mexico. They are called “caja popular”. One of the largest is Caja Popular Mexicana.
What is the best way to transfer money from my home country into pesos so I can get the best rate?
The first thing you will want to do is open a Mexican bank account. Once you have your account, you should set your funds (social security, pension, payroll, etc.) to direct deposit into that account. Funds that are Direct Deposit are automatically transferred into your Mexican account in pesos at the best exchange rate. It’s a much better deal than showing up to the bank and depositing cash or having your home bank send your Mexican bank a check.
If you have savings in your home bank account and want to move it into your Mexican bank account at the best rate, do a direct transfer from your home bank to your Mexican bank. Direct transfers can be done with services such as Transferwise.
About the Author:
The Fun Side of the Wall: Baby Boomer Retirement in Mexico
Travis Scott Luther is the best selling Author of The Fun Side of the Wall: Baby Boomer Retirement in Mexico. Luther is also a former Adjunct Professor of Entrepreneurship at MSU Denver. He received his Masters Degree in Sociology from the University of Colorado Denver where he later served as Entrepreneur in Residence.
Luther first became interested in Baby Boomers retiring in Mexico during graduate school. His Masters Thesis research contributed to the content of this book. He continues to be interested in U.S. expatriates retiring all over the world and continues to monitor those who have retired in Mexico.