Best Exchange Rate
Where can I get the best exchange rate when I’m traveling abroad?
It depends on what form of currency you’re carrying. If you’re going to exchange traveler’s checks, it is advisable to exchange your money in the country you’re traveling to, rather than in the US Banks, American Express offices and post offices are the usual places where you can get the best currency exchange rates. You can also try out hotels.
Stay away from the money exchange bureaus in tourist hubs. Usually they have the worst conversion rates. Also, to lure travelers, some of these exchange bureaus often display the selling rate rather than the buying rate for the US dollars which is just the reverse of what you need to know, since you are going to exchange US dollars into foreign currency.
Whichever country you’re in, read the exchange rates listed carefully and enquire about the net rate you’re going to receive after paying commissions. Some agencies may charge commissions on a per-item, per transaction basis, while others may charge on a percentage basis. If you pay on a per transaction basis, make sure you exchange enough money so that you don’t have to do this again often – if you can do it, paying once for all the foreign money you’ll need can save you money in per transaction exchanges.
What are the pros and cons of exchanging currency at a retail outlet?
Exchanging currency at the retail level is definitely one of the easiest and more convenient ways of trading your US dollars for your desired foreign exchange. For example, in America, most of the shops and restaurants in bordering towns as well as cities that regularly get a large influx of travelers will be happy to offer Canadian dollars. But then, they might also charge you heavily for this “convenient” service, often giving you an exchange rate that is 10 to 12 percent higher (in their favor, not yours!) than the existing currency conversion rates.
Do I need to know about DCC (Dynamic Currency Conversion)?
If you are one of the many seniors embarking upon a long trip to Europe, you should be careful of the service offered by many European retailers, called “dynamic currency conversion” (DCC).
When you make a purchase in Europe, the merchant’s cash record will show the sales price in both Euro and well as US dollars, giving you the choice of making your payment in either of the currencies. And even though you may swipe your credit card for purchasing, the DCC rates that are offered are not the rate offered by MasterCard or Visa, but that of the retailer involved, so you need to be more alert.
How much foreign cash do I need to carry while traveling abroad?
Stocking large amounts of foreign currency before setting out on an overseas trip can have its disadvantages. For example, if you’re traveling in a large group or with your family, your calculated expenses could easily run into thousands of dollars. This may not be a comfortable amount to carry in your wallet while traveling to unknown places.
Some senior travel agencies ask travelers to carry all possible forms of foreign exchange tools as their multiple “back ups” in case one of them doesn’t work out. For example, a combination of hard cash, travelers’ checks, at least couple of debit cards (in case one of them doesn’t work) and one credit card ensures you’ll always be able to access cash in a foreign location!
Can I use ATMs to get cash when I am abroad?
Whether you need Euros, rupees, yens, shekels, pounds or pesos, using your ATM card to make cash withdrawals is generally the most convenient and the easiest way to get cash abroad.
The greatest advantage of using your ATM card is that all cash withdrawals, regardless of the amount, are based on the wholesale exchange rate, which is otherwise reserved for big inter-bank exchanges.
Even if you compare, this rate would be approximately 3 to 5% better than what you are going to get by exchanging traveler’s checks at a local exchange center. Local exchange bureaus and financial institutions will charge an extra transaction fee, which can swallow an additional 2 percent of your money.
This does not imply that international ATM withdrawals are free of any transaction fees! However, if you need cash abroad, you can often find the best exchange rate by using your ATM card.
How do I Locate ATMs abroad?
Those of you who have their ATM cards linked to the PLUS (the PLUS network is associated with Visa so you can use the Visa ATMs) or Cirrus networks (the Cirrus network is associated with MasterCard so you can access the MasterCard ATMs) have the privilege of using it to withdraw cash almost anywhere in the US and across 210 countries all over the world.
Before leaving, make sure that both these ATM networks are available wherever you’re traveling.
Also, if your bank is a member of the “Global ATM Alliance” (Deutsche Bank, BNP Paribas, Barclays, Bank of America, Westpac and Scotiabank), you can access ATM’s of the other associate banks abroad for free.