Exploring cultures, countries and comfort zones
Foreign Currency Exchange
When it comes to navi- gating exchange rates, it pays to know all your options. From buying money online to grabbing it at the
airport, here are the seven most common
methods for foreign exchange.
1. Swipe a credit card. Use your credit
card just as you would at home. Card
issuers usually add currency-conversion
fees of 2 to 3 percent for international
transactions. You’ll get the best exchange
rate and fees that are lower than those
associated with exchanging cash. Use it for
large purchases, hotel bills and restaurant
tabs. It’s convenient enough to use instead
of cash whenever possible. But don’t use
it to take money out of an ATM. You’ll be
hit with hefty fees (up to $20 in transaction fees or 4 percent of the amount of
the advance, along with any local ATM
fees), plus you’ll be charged interest starting on the day you withdraw the money.
over the phone or online and it will be
delivered to your local branch for pickup
for a fee (sometimes as high as $10).
Some banks will waive this fee for their
best customers, so be sure to ask before
ordering. This is a good option for travelers who want cash before a trip.
dollars for yuan.
6. Buy a prepaid foreign currency card.
These cards can be used like credit or
ATM cards, but travelers preload them
with a set amount of euros or British
pounds (the only two currencies available). This convenience has numerous
fees (for withdrawals, inactivity, and to
close the card) and restrictions (
withdrawal minimums and limits per day).
2. Withdraw cash with an ATM card.
Depending on your bank, your
American debit card can be used in
international ATMs to withdraw local
currency. Most banks add fees ranging
from 3 to 8 percent. Some banks, like
Citi and Bank of America, have international branches or partners that allow
you to use your ATM card fee-free in
most cases. If you use an ATM outside
your bank’s global membership, you
could incur some outrageous fees.
4. Buy cash online. You can order currency before your trip from websites
like oanda.com, and it will be shipped to
your home using a secure two-day delivery service. This option gives you cash on
hand for immediate purchases like cab
fare. If you need a large amount of cash
($1,000 or more), delivery fees sometimes can be waived if you ask.
7. Foreign exchange desks. Most international airports have at least one
foreign-exchange desk where you can
swap U.S. dollars for the local currency
for fees as high as 20 percent! You also
can exchange American cash for local
currency at your hotel; commissions and
rates will vary widely. Some currency-exchange desks located in city centers
offer better rates than the desks at airports. Save this option for emergencies.
3. Exchange cash at your bank. Most
large banks sell foreign currency. If you
have a bank account, you can order cash
5. Buy Traveler’s checks. Traveler’s
checks function just like U.S. dollars,
except they can be replaced if they’re lost
or stolen. When you arrive at your destination, you need to find a place that
will exchange the checks for local currency. You also will pay any associated
fees, which can add up to $9 per check.
Traveler’s checks are an excellent value
in China. Fees are low, and the exchange
rate is regulated by the Chinese government, making this one of the safest and
most inexpensive ways to exchange U.S.
Barbara Parus, editor in chief of Speaker magazine, compiled the information for this column and now she knows how to get the most bang for her travel bucks.
She can be reached at barbara@nsaspeaker.org.
