I’m probably on the plane right now trying to work out my personal budget for this trip so a big “Hi” from the sky! I wonder when they will actually have free WiFi for everyone on the plane but I am satisfied for now to have my Nintendo DS with me while I sit through a 15-20 hour flight to Bali Island!Speaking of traveling, I used to get my money through the currency exchange at the United States airport. After a while of doing this, I realized that it is one of the worst places to get money in foreign currency. Not only are they more expensive than most other places, they also don’t have every currency that I sometimes need.
What I do now is get it when I actually arrive at my destination. It is pretty convenient because they would always have their own currency and offer competitive rates. For an even more savings, the local currency exchanges places found outside the airport offer even better rates. I caution you though because 1) not every country has one and 2) the store is not easy to locate at times.
Another option is to order money through your bank. Believe it or not, banks like Wells Fargo let you order foreign currencies in person, online or over the phone. Check their website for more details. The rates are comparable, but you would need to do this ahead of time so this option is only for the organized folks amongst us.
Some hotels can also do currency exchanges. However, anyone who has ever used ANY services from the hotel will no doubt agree that they charge a premium for everything. So, it is not the best option even though it’s quite convenient.
There is always the option of using a credit card. However, many credit cards charge a service fee every time you make a purchase in foreign currency and then they make money off the exchange rate, a double whammy. Capital One credit cards don’t charge this service fee but again, the exchange rate is not great. The other point to consider is that credit cards are as widely accepted in certain countries than developed ones. Unlike North America where almost every store accepts credit cards, there are many stores in Asia (for example) that only accept cash.
The last tip I have is to ask the cab driver! Never ask him to take you there as you don’t know whether to trust him or not. Instead, talk to him about exchange rates and ask him for suggestions for your next trip.
Do you travel much and can offer some tips for the rest of us? We’d love to hear from you!
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{ 9 comments… read them below or add one }
Thanks for the advice!
Hi Moneyning, Thanks for your article! I will be traveling the next few weeks in Asia! Any good suggestions on exchange rate in Asia??
A quick reminder on foreign currency! Don’t forget to let your credit card company know that you will be traveling in certain time period. In that case, you won’t be rejected in the foreign country when you try to use the card overseas. Furthermore, there will be a 2% – 3% transaction fee add on the bill. As I know, AE card has the lowest transaction rate (2%) compare with others! Hope this information helps.
Emily: Apart from the suggestions in the article, you might want to make sure you have a budget and not get much more currency than you need. The worst thing is to exchange for too much foreign currency, and then convert back at the end of your trip because you don’t have a need for the rest of them.
Aaron: I never knew they would do that! Which credit card company are you using?
Also, check Capital One’s credit card as they don’t charge transaction fees for foreign purchases.
If I am traveling on business, I let my company take care of it. I have even used them for my personal travel as they get amazing rates because we do so much business in various countries. If your company is open to this, it can be a great money saver.
The Dividend Guy: I bet it will be but unfortunately I work for a small company and we really don’t have the resources to manage this on top of everything else that all the employees have to do
I think it’s a great idea though. Sort of like “buy in bulk”!
I work in an exchange office in Canada and I disagree with you… Airports are not the best place, that is true. But going at an exchange office in the city before you leave is a lot cheaper than changing your money in the country you going to. Why? Because exchange office are “stuck” with foreign money and they want to get rid off it…by selling it to you! Of course, it won’t come free, but it’s cheaper.
We live internationally and exchange money by withdrawing dollars at the bank and then exchanging on the street. I’m not sure if every country works this way, but they give you a really good exchange rate in Nicaragua. If you need a receipt, you can usually ask around. We found a little store two places down from our bank that exchanges money in a relatively private booth and gives a little receipt. Their exchange rate is the most competitive in town.
I just looked up the currency exchange and the guys on the street have about .2 of a cordoba charge. That’s about 2 american cents.