h2g2 The Hitchhiker's Guide to the Galaxy: Earth Edition

I've never seen the point of taking any significatnt quantity of money abroad - in any civilised place, you can find a hole-in-the-wall that takes visa, and my building society(nationwide, uk) debit card gives me commision-free withdrawals. The rate of exchange isn't great - but when you compare it to the trials of taking too much money, too little money, and the risk getting robbed of a few hundred pounds right at the start of your hols, it starts to just blatantly make more sense...

So I tend to take just enough to last me until I find a cash machine - perhaps $50 - and then take $50 out of the wall whenever I find myself running short. To keep track of how much I'm spending, I keep all the receipts next to the card.

That's a good plan but after a nasty experience I had in Australia I would always recommend keeping some travellers cheques on hand. I stayed in Sydney for 6 months and opened an ANZA bank account. I routinely took money out of my Canadian bank account and deposited it to my ANZA account then used the ANZA card for purchases and withdrawals so I didn't get zapped $2 for every transaction.
It was a wonderful system until one day my ANZA debit card was de-magnetized. No problem - I went in and they replaced it the same day. A couple of days later I found my Royal Bank debit card was de-magnetized. BIG problem! They would not courier me a replacement card, my ANZA account was running low and I was stuck 10,000 miles from home with no money and 2 months left before I was due to go home Phone banking to the rescue - I called Canada, transferred money to my VISA, then did a cash withdrawal from that. When I got home I asked the bank to issue me a new debit card and a spare, in case this happened again but apparently they won't do that. You get one card - that's it! I left shortly after that for 3 months in England and I was a little more careful about having cash & travellers cheques on hand. I no longer trust ATMs to take care of me.
Oh, by the way, the culprit that de-magnetized my cards was the electronic security key for the elevator in my building. I put my keys in the same pocket as my bank cards when I went for a walk. That's what killed them. Something to keep in mind if you stay at an apartment or hotel with electronic passes.

I went in a group of friends, and relied on it being unlikely that we would all simultaneously lose our debit cards...

American Express is one card that is meant to offer you instant replacements if you lose it - so maybe that would work well?