Need to Exchange Currency? Pay Attention

If traveling to a foreign country is in your near future, one of the biggest costs that you need to avoid is the often expensive exchange rate that you’ll be charged when switching from American dollars to another currency.

Tourist areas and airports are notorious for charging high exchange rates, for example,  and a number of credit cards and banks also charge you an exchange rate when you purchase something using in a foreign currency using their card.

Below are a number of tips that will help you to maximize your American dollars while also minimizing any exchange rates or fees that you’ll have to pay when vacationing. Enjoy.

  • Before making any exchange, ask how much you will get for the specific amount of money you want to exchange. The fact is, many currency exchange places will tell you that they don’t charge fees or that they have excellent exchange rates but, oftentimes, will give you a worse exchange rate than other locations. If you ask specifically how much money you will receive for a specific amount of money that you want to exchange, you’ll know exactly what you’re getting ahead of time and be able to determine whether or not their exchange rate is fair. Also, keep in mind that changing currencies in the country you’re visiting is usually less expensive than changing it here at home in the United States.
  • If your hotel or another business asks if you’d like them to convert their bill into American dollars, tell them no. In most cases their exchange rate will be much higher than the exchange rate that your bank or credit card might charge you (see below to avoid these too). Simply let them bill you in their currency and let your credit card or bank do the exchange after your vacation is finished.
  • If you have a smart phone (and who doesn’t these days) you should definitely get a currency converting app before you leave home. These are extremely convenient and, in most cases, very easy to use, and will tell you if you’re getting a good deal on your money exchange. Two of the best are GlobeConvert and XE Currency.
  • Finding and using a credit and/or debit card that doesn’t charge of foreign exchange fee is an excellent idea. Unfortunately, most credit cards charge from 2 to 3% for every purchase that you make in a foreign currency, which can add up very quickly. There are many cards that don’t however and, if you take a look websites like bankrate.com, creditcards.com and others, you’ll find cards that don’t charge anything.
  • Just like using a credit card that doesn’t charge foreign exchange fees, using a bank or checking account that doesn’t charge them is an excellent idea when you’re traveling abroad. You should definitely check with your bank before leaving to make sure that they don’t charge exchange fees and, if they do, consider opening an account with another bank specifically for your trip. It might take a little bit of time and effort but, depending on how much you plan on spending and how long your trip will take, it might save you quite a bit of money. If you want to find out which banks don’t charge exchange fees, NerdWallet.com will tell you.

Traveling abroad can be an amazing experience and quite an adventure. If you don’t want it to be an expensive adventure however, following the tips above is in your best interest and could save you hundreds of dollars. Bon voyage!

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7 thoughts on “Need to Exchange Currency? Pay Attention

  1. The costs of money exchange can be huge especially if one isn’t careful. Some dealers morever tend to take advantage of the travelers confusion with the host country currency to give them a bad deal. Perhaps to add, a traveler should closely study the destination currency and have a rough figure of its dollar value before exchange and for every transaction.

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