Many people take time to carefully budget when planning their holiday but fail to include the cost of exchanging currency. Without proper planning this can put a bit of a wrench in your plans – especially if money is tight.
To avoid those unpleasant surprises, follow these tips that will allow you to get the best currency rates each time you travel so that you can spend your hard earned money on something more enjoyable.
Exchange rates can vary greatly
Exchange rates and fees are not the same across the board. They can vary greatly depending on where you go to convert your money into pounds, euros or francs. It pays to do some comparison shopping.
Where not to exchange money
When you finally land after that long flight it can be tempting to hit that airport kiosk to exchange your money – tired travelers are what the companies that operate them are counting on, but they’re the only ones winning in this situation by taking a rather large cut to change your money into currency you’ll be able to use quickly. It’s just not worth the convenience.
Many travelers also make the common mistake of converting their money before embarking on their journey. While it does provide a little excitement before that anticipated vacation arrives, it comes with a high cost.
Many banks and travel agents will happily exchange your money in addition to online companies willing to deliver foreign currency directly to your door, but as you might imagine this offers one of the worst exchange rates.
The best option for an optimal currency exchange rate
While you might think using a debit card at an ATM in a foreign country would cost quite a bit, it’s actually the least expensive option and typically rather convenient too. There are an estimated 2 ½ to 3 million ATMs estimate around the world and they can be found at nearly all of Europe’s international airports. If you want to be sure, ATM locators can be found online here for MasterCard and here for Visa to verify that you won’t have problems accessing your money when you arrive at your destination.
Keep in mind that the PIN should be made up of digits and not be an alphanumeric PIN as some machines will not recognize them. This can easily be changed by calling your bank.
Most banks charge an average transaction fee of $3 to $5 plus 1-3 percent of the withdrawal amount which usually comes close to the current wholesale exchange rate. There are a few banks who may try to gouge their customers, so it is important to verify this before leaving. If you find yourself with one of these banks it may be worth opening another account with a different bank even if it’s just for the duration of your trip.
Planning cash withdrawals while in Europe
It makes financial sense to make fewer large withdrawals instead of smaller, more frequent withdrawals in which you’ll incur more fees. You’ll want to plan ahead in order to avoid withdrawing too much and end up being stuck with a lot of foreign money that has to converted back to your original form of money again.
If you plan to make any large purchases while in Europe, you might be better off using a credit card because of the consumer protections you’ll get if a dispute arises. Unless you have an emergency, do not use credit cards to withdraw cash at an ATM as you’ll incur several fees on top of the exchange rate in addition to the interest that is charged as soon as you make the withdrawal.
Related Europe posts:
Internet Access in Europe – Europe Travel Insights & Network
Using Electricity in Europe – Europe Travel Insights & Network
Shopping in Europe Tips – Europe Travel Insights & Network
What to do if You Lose Your Passport While Traveling In Europe