Top Strategies for Exchanging Currency While Going Abroad

Handling currency efficiently while travelling can significantly impact your overall experience. Whether you’re a first-time traveller or a seasoned adventurer, knowing the best way to exchange and use currencies can save you money, time, and stress. Look at the best strategies for managing currency while on the go.

Use Credit Cards With No Foreign Transaction Fees

Many travellers have discovered that using a credit card is the most convenient way to pay for products and services abroad. However, some banks charge foreign transaction fees, which will add up quickly. Consider using a travel-friendly credit card with zero foreign transaction fees. These credit cards also have better exchange rates and perks like travel insurance and rewards.

Withdraw Cash from ATMs Upon Arrival

When you arrive at your destination, use local ATMs to withdraw cash in the local currency instead of going to the airport kiosk to exchange money. ATMs usually have better exchange rates than currency exchange counters. To avoid high fees, you can use ATMs affiliated with major banks or those in safe locations like hotel lobbies and shopping centers. Another option is to use a CFD broker to convert your currency and engage in forex.

Get Some Local Currency Before You Leave Home

While ATMs are the best option, having a small amount of local currency before arriving at your destination can be useful. You can exchange some money at your home bank before your trip to pay for expenses like transportation, tipping, and snacks.

Avoid Airport Currency Exchange Counters

Every experienced traveller knows you should never convert your currency at an airport. Currency exchange kiosks at airports offer the highest fees and worst exchange rates. If you need to exchange money at the airport, consider doing so in small amounts. However, if it’s larger, it's best to withdraw cash from an ATM or just use your credit card instead.

Use a Prepaid Travel Card or Multi-Currency Digital Wallet

Different wallets and prepaid cards allow you to store multiple currencies in one place and make payments wherever you are. Digital wallets like Revolut, Wise, and PayPal offer competitive exchange rates. Prepaid travel cards are even better because they allow you to lock in the exchange rate in advance, meaning you’re not affected by future currency fluctuations.

Know the Local Exchange Rate

When planning your trip, you should check the local exchange rate of your destination using reliable apps. This can protect you from getting short-changed when you make transactions and ensure you make cost-effective decisions, whether you’re paying in cash or exchanging currencies once you get to your destination.

Always Pay in Local Currency

Wherever you go abroad, you should pay in local currencies, whether with a credit card, debit card, or cash. If you’re using a credit or debit card, you might have the option between home currency and the local one. Always choose the local one because your home currency will attract conversion fees and high exchange rates.

Keep an Emergency Backup Card

Hiccups can always happen while you’re travelling; having a backup card can be a lifesaver, especially if your primary card is lost, stolen, or blocked by the bank. You should store the backup card separately from the primary card so that if the latter is stolen, the former will still be safe. Your backup card should be activated for international use.

Beware of Dynamic Currency Conversion (DCC) Fees

Some ATMs and foreign merchants offer dynamic currency conversion, a feature that allows them to convert change into your home currency before processing transactions. This seems convenient, but you might have to pay hidden fees and unfavourable exchange rates. So, if you see this option, decline it and choose to be charged in local currency instead.

Notify Your Bank Before Traveling

Inform your bank before you travel to avoid sudden security blocks on your card. Some banks will automatically view your transactions as suspicious if they are foreign, leaving you without access to your money. You might not have to visit the bank, as many banks allow you to set up travel notifications online or through their mobile app.

Efficiently Manage Currencies While Traveling

While planning your trip abroad, it’s essential to consider how to handle currencies and make payments. You must efficiently manage currencies and use intelligent decision-making to avoid paying more fees and higher exchange rates. Consider using credit cards without foreign transaction fees, digital wallets, and withdrawing cash from ATMs; you can reduce extra costs and increase convenience. Keep these tips in mind, and then you can easily navigate currency exchanges, enjoying your trip to the fullest.