When traveling aboard, it is very important to exchange your money. In this post, we provide you with some main useful tips.
When should exchange your money ?
As a traveler, your main concern will be getting the most favorable rate possible. A commonly asked question is: should I convert now, or will my money be worth more when I go abroad? Unless your trip is months away, the answer is that it probably will not make much of a difference. The major currencies tend to move +/- 1% in a given day, which is a relatively minor move unless you are changing thousands at a time. Experts agree that travelers will be best off looking for a place that will change money inexpensively. Below are some of your options.
Where to exchange money ?
Exchanging Money at Home
While still at home, you can exchange currency at your local bank. Experts suggest only changing enough to cover travel and transportation costs until you are settled at your destination, as the costs of exchanging money at home can be prohibitive. Other services you can use at home include online money exchange services, which will take American funds and send the converted money to your home. The obvious risk with services like these is fraud and the safety of your funds while they are in transit.
Changing Money at Hotels and Airports
While hotel and airport exchange may seem convenient, beware of high transaction charges. Generally experts advise avoiding exchanging money at a hotel unless you have no other choice. You can use the currency converter or calculator on our site to determine approximately what you are being charged in transaction costs, so you can more clearly identify how much the markup is.
Exchanging Money via Credit Cards
Generally credit cards offer the most favorable exchange rates for changing money, since credit card companies have access to better rates than individuals. Be careful when using the credit card if your home currency is falling-since the transactions are not converted instantly, there is a possibility that you will end up with a less favorable conversion rate a few days later.
Another alternative to cash is to bring travelers checks with you. Even though these are fading in popularity, they still offer some excellent benefits-namely, that travelers checks can be replaced if they are lost or stolen, and can be used freely at exchanges to get the currency of the country you are in.
Changing Money at Local Banks
The rates given at local banks are usually decent, although keep in mind that one of two things can happen. If the exchange rate given is determined purely by supply and demand, then you will end up with a price that is close to what is being quoted in the foreign exchange market globally (“market price”). The other alternative is that the government of the country you are in sets the currency exchange rate, which must be offered by anyone who is changing money. Regardless, local banks are often a convenient and relatively low-cost option for changing money.
No matter what, always check current rates beforehand by looking in a local newspaper, or by using our currency converter.
Changing Money at ATMs
If you would rather not carry large sums of cash, ATMs are a convenient way to obtain local currency at a reasonable exchange rate. Keep in mind that your withdrawal may be subject to a fee, so check with your bank before leaving home. The other point to note is that your bank may freeze your card if out-of-the-ordinary transactions (such as withdrawals in 4 different countries over the course of a week) appear, so keep a copy of your bank’s contact information on hand.