When traveling abroad, you want your U.S. dollar to go as far as it can to fund expenses. Besides shopping around for a travel-friendly credit card, how do you get the most bang for your buck when getting cash?
Make the most of your money and avoid spending a fortune in fees. Our answers to your top foreign currency exchange questions will help guide you before you travel.
How do I exchange currency?
There are various ways to exchange currency for international travel. Which way you choose depends on advance planning, location, and timing. Here are a few ways to accomplish it:
- Online – If you choose to exchange currency before you leave, you may save money on rates and fees if you purchase online. If you are interested in comparing rates and buying currency online before you travel, check out Coinmill.com, Travelex, and BestExchangeRates.com. Some will buy back foreign currency upon your return.
- In person – Your local bank and credit union are the best places to find good rates while avoiding exorbitant fees. Always ask if they have a foreign banking affiliate at your destination, which could save additional money and fees if you need cash while there. Some banks order currency and actually ship it to you, or you can arrange to exchange in person. Also, ask if they’ll buy back any left-over foreign currency when you return.
When is the best time to exchange?
Planning ahead is vital. Save money by tracking exchange rates before travel, and shop around for the best deal. Do some research online, talk to others that travel frequently, and discuss with your local bank. Use technology! Receive up-to-date exchange rates for over 160 currencies and countries with the free Currency converter app, available for iPhone, iPad, Apple Watch and Android.
Where are the worst places to exchange foreign currency?
- Never exchange money on the street. It’s shady, unsafe and you’ll get ripped off.
- Avoid exchanging money at an airport, hotel or train station – they have some of the highest currency exchange rates out there.
- Skip currency exchange counters or kiosks that claim “no fees, no commissions.” They simply make their money through higher rates, even if they don’t charge a fee.
- While credit card cash advances may seem convenient, don’t do it. You’ll be hit with fees and interest you don’t want.
- Resist high traffic, city center currency exchange locations that are often independently owned. Often they rely on convenience and charge high rates and fees.
Can I exchange currency at an ATM?
Yes – you will be given the exact current exchange rate and you’ll find the best rates at your bank’s ATM network. Some details to keep in mind:
- Pay attention to fees – Fees will vary by institution, so while exchanging at an ATM is convenient, be careful of the extra potential costs. Some charge a flat rate, percentage or even both. Save money by keeping your ATM trips to a minimum and taking out larger amounts to reduce the number of withdrawals.
- Use caution with debit cards – Know that some foreign ATMs charge out-of-network transaction fees and may have withdrawal limits. As mentioned before, always ask your home bank about their policy on foreign transaction fees and if they have a relationship with any banks at your destination.
- Know the lingo – Each country may call the ATM by a different name, so do your research. For European travel, check out our detailed tips on using credit cards, debit cards and ATM machines while there.
- Use common sense -Always have backup payment methods ready (credit cards, prepaid cards, traveler’s checks) just in case. Avoid secluded, low-lit locations and cover the keypad when entering your PIN. If the machine is inside a building, don’t let people stand directly behind you. Know how to hide your cash while traveling.
- Plan to have a travel-friendly credit card – Look for a credit card with low or no foreign transaction fees, and/or those that offer international ATM fee reimbursements. You’ll save money on purchases and rack up perks at the same time. Be sure to let your credit card company – and your bank – know you’re traveling to avoid any freezes on your account. To learn more about the advantages and disadvantages of using credit and debit cards abroad to exchange currency, check out bankrate.com.
Now that you know the basics of foreign currency exchange before travel, don’t forget to protect your investment from the unexpected by purchasing travel insurance. We’re here to help. #TravelOn
Subscribe to the Smart Travels Newsletter to learn more about traveling easier, safer and smarter.