Most international travelers exchange currency before takeoff, so that they have at least a little money for taxis at the airport or other direct costs. Once you reach your destination, you will most likely find currency exchange kiosks at airports, ferry terminals, hotels and other areas where tourists congregate. However, these kiosks are usually more expensive than banks -- the total cost is sometimes more than 7 percent. However, there are other ways to save money, if you plan ahead.
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Method 1 of 3: Changing Currency at Home
Step 1. Understand the process so you get the best deals
If you've never exchanged currencies before, it's a good idea to understand a little about the process so you don't get expensive surprises. The general idea is that you'll find a business that exchanges currencies, and they'll give you the currency you want to exchange for a small fee (and of course, plus the amount you want to exchange). Now, apart from that, it is very important to understand that some currencies are more valuable than others. For example, one euro is usually equivalent to 1.30 USD or.80 GBP. The difference will vary, usually with economic status. So even if you trade $100, you might only get 75 euros.
- Meaning, your goal is to exchange currencies when your currency is high and the foreign currency is low, because that means you will get more foreign currency than usual.
- Understanding that the dollar (for example) is worth less than the euro has nothing to do with the price of goods. The relative price of goods is determined by the market in the area. So, for example, bananas in the US are cheaper than bananas in Sweden, even though the dollar is stronger than the krona.
Step 2. Exchange some money before you leave
It is very important to exchange some money before you travel. You will likely come across suggestions that it is better to exchange currency in the country you are visiting and that is usually true. However, you need to have money set up for when you land. There will be some travel costs, between landing at the destination and being able to exchange money again, which is where many problems can arise. It's a good idea to have a little cash on hand, including a few pennies and coins if possible, so you're ready for anything.
The amount you should have varies depending on where you're visiting, but the equivalent of $40 USD is usually a good start, if you're going to be at your destination more than 3 days
Step 3. View the exchange rate status
Before you exchange money or decide how much to exchange, do a little research on exchange rates. Exchange rates will fluctuate, and if you want to exchange large amounts of money, you should time it carefully so you don't lose too much money. Generally, you are better off waiting to trade some of your money until it lands. However, if the rate of your home currency falls, you are better off trading everything you need before leaving.
Searching for "currency rates" on google will show you a chart for the currency of your choice, allowing you to gauge the standing of your currency
Step 4. Go to your bank
The easiest place to exchange currency at home is at your bank. Go to the bank institution you are using and say that you want to exchange currencies. The advantage of a bank exchange is that most banks will charge a very small fee for exchanging currencies (if they do charge) and you know you are getting a good rate.
The only trick here is, unless it's a big bank in a very big city, they very rarely have that currency. You need to order currency at least a few hearts and sometimes up to 2 weeks in advance. Plan ahead
Step 5. Use a good account for tours
Before leaving, contact your bank and ask what the conditions are for using your card overseas. Most banks will charge a fee for using your card, at an ATM, foreign bank, for writing checks, etc. while abroad. If they charge large fees, you may want to open a separate bank account with another bank. Search until you find a bank that charges low or no fees. Then, transfer your money into that account. You can use this account whenever you travel abroad.
Some banks charge a monthly fee for money below a certain amount in your account. If you intend to keep a traveler account, you should keep a certain amount of money in your account at all times, to prevent additional costs
Step 6. Buy money online
You can also order money online. This should be done before you leave, as it is not so safe to do once you arrive. Exchange rates are usually updated and the fees are reasonable, but the cost of this money being sent to you can make this option undesirable. However, if you feel lazy, this way you don't need to go to the bank.
The best time to do this is if you plan on exchanging large amounts of money. If you order a large quantity, between hundreds and thousands of dollars, you can ask them to waive shipping costs. Some companies may do this and it makes the rate you get more reasonable
Method 2 of 3: Exchanging Currencies Abroad
Step 1. Prepare to pay cash
When you travel abroad, you should be prepared to pay cash for more services and products than at home. Not all countries use the card as widely as in ordinary English speaking countries. This means you should know that you may have to pay with cash for items you would normally pay for by card.
This is very common in poorer countries. They usually have less infrastructure for widespread use of the card
Step 2. Use an ATM
The easiest way to exchange currency while traveling is to use an ATM. Look for the big bank ATMs in the area then, as long as you have one of the VISA or Master/Maestro cards, you are capable of doing basic transactions like issuing money. This will usually give you the best rate and if you have a good bank for travelers, you won't have to pay any fees at all.
Finding an ATM can be difficult. It is best to let Google be your guide. Come to a place, at the beginning, where you have internet access and then ask Google Map for the nearest ATM location. You can also find ATMs by searching for a bank. If you don't know where to look, ask the hotel concierge or taxi driver
Step 3. Pay with your card
Whenever possible, pay for goods and services by card. As long as it's a major card (VISA or Master/Maestro), any business that accepts credit or debit cards should be able to accept your card without any problems. This is very useful because your bank simply exchanges money on their premises and you don't have to worry about exchanging your own currency at all.
- However, be aware, you may encounter some problems with the card itself. Certain countries have switched to more secure chip and pin systems. Certain card readers will not be able to read traditional North American swipe cards.
- Again, some banks charge high fees for this. Find out how much your bank charges before you go.
Step 4. Visit the nearest major bank upon arrival
Just as you can exchange currency at home with a local bank, you can also use any bank once you reach your destination. This can be a little difficult but just like at home, you are likely to get a valid exchange rate and minimum fees.
- You might think the language barrier would be the biggest problem but as long as you're in a big city and you're visiting a large bank in a central location, you're more likely to find at least one teller who can speak English.
- The main problem is that some banks will not exchange currency if you are not a customer. The easiest way is to ask around and hope for the best. If they can't exchange your currency, they may at least be able to help you find a bank that can. They are more likely to exchange your currency if you spend money using a card, as this is safer for them.
- You can also ask the hotel concierge to help you find a bank that can exchange your currency.
Step 5. Purchase a prepaid card
This is not the best option but it is the available option. Prepaid cards are like debit cards but contain a set amount of money. You can order it before you go or buy it after it arrives. However, the rates on these cards are usually very bad, some businesses may not accept them, and you are in big trouble if you lose them. However, for some people this may be the best option.
Be careful when buying this card. You should only buy them from reputable sellers
Method 3 of 3: Getting the Best Rate
Step 1. Plan ahead to prevent over-swapping
Before you leave or at least before exchanging too much money, plan what you are going to do and how much money you will need. Swap the lowest amount you think you will use. This way, you don't run the risk of over-exchanging and wasting money in exchanging money back after you return.
It will also help you get the minimum fees, if the exchange fee with your method is a one-time fee (such as an ATM or bank)
Step 2. Do your research
Check the latest exchange rates before exchanging money using the service, especially if you are using a specific currency exchange service. Businesses that specialize in exchanging currencies and some small businesses that exchange currencies will usually give you the old, profitable rate for them, so they can make more money than you.
Download the app before you leave so you can easily check the rates on your mobile. Be careful that you only turn on data when checking rates, so you don't exceed your data plan while abroad
Step 3. Visit several places to get the best rates
Don't be afraid to find out what you can get at different locations. With a bank there may not be much of a problem, although some banks may charge less than others, a money changer business will certainly have varying rates. This will give you the advantage of being able to bargain with the business, as small money changers will be more willing to try to get business from you.
Step 4. Pay in your own currency if you can
If you're in an area where you have the option of paying in your own currency, do so. Usually, if a business allows this, they will tell you or the price will be marked. However, make sure you are told the rate before paying. Usually there will be a price increase, so they can pay the exchange fee, but usually it's small.
This is most common in areas and countries where your currency is highly valued or used frequently
Step 5. Swap in the country you are visiting
Usually, the easiest way is to exchange your money in the country you are visiting. Especially if you come from a big country to a small country, because your money will be more valuable. The bottom line is that you'll probably want to carry as little cash as possible when you travel (although you can keep your money in a hidden or safe place, like a hotel vault) so exchanging once you arrive is better than possibly forgetting your wallet at a transit airport in Bangladesh.
Step 6. Avoid airports and hotels
Do not, as much as possible, exchange currency at the airport or hotel. You will be charged huge fees and a very bad exchange rate. Beware if they advertise "no charge" or "free of charge", because those places will give you the worst possible rate. Swapping at one of these locations should be a last resort.
