Best Strategies For Changing Currency At The Airport

Exchanging currency at the airport is often a last resort for travellers, as it is well-known that airport currency exchange rates are among the worst you can get. However, if you need cash upon arrival, it is still an option. Here are some things to keep in mind when exchanging currency at the airport or elsewhere.

First, it is important to understand exchange rates. The exchange rate is the mathematical rate of one currency to another and dictates how much foreign currency you will get for each unit of your local currency. For example, if the exchange rate is $1 to R18, you will get R18 for every $1 you exchange.

Second, be mindful of exchange fees and transaction fees. Exchange fees are charged as a percentage of the total amount being exchanged, while transaction fees are charged per transaction. These fees can add up, especially when exchanging large sums of money.

Third, consider convenience. Exchanging money at the airport can be more convenient than doing so at a bank, as the lines are usually shorter and you can take care of it while waiting for your flight. Additionally, airport exchanges always have foreign currency on hand, whereas banks may need to order it.

Finally, be aware of other options for accessing money while travelling. Credit cards often offer good exchange rates and are widely accepted, but be sure to let your bank know you will be using your card abroad to avoid any issues. Forex accounts are also an option and allow you to save money in a foreign currency, but not all banks offer this service.

Avoid exchanging currency at the airport

Exchanging currency at the airport is often the most expensive way to obtain foreign currency. Airport currency exchange kiosks and counters are convenient, but their exchange rates are typically much less favourable than your bank at home. They also charge fees, sometimes hidden within the poorer exchange rates they offer.

So, What Are Your Options?

• Get cash at your bank before leaving your home country. Most major banks will have foreign currency available to sell to you without charging an additional fee beyond the exchange rate.
• If you have time before your trip, apply for a credit card that doesn't charge foreign transaction fees, especially if it's a good travel rewards credit card.
• Pay in the local currency to avoid currency conversion fees.
• If you're a frequent international traveller, consider using an international banking app, such as Wise or Revolut, to manage your money.

Order foreign currency from your bank

Ordering foreign currency from your bank is a convenient and secure way to ensure you have the funds you need for your upcoming trip. Here are the steps to follow:

Check Your Bank's Offering:

Start by checking if your bank offers foreign currency exchange services. Most major banks in the US provide this service, with some offering a wide range of currencies for various countries. For example, Wells Fargo offers over 70 currencies for more than 100 countries, while Bank of America facilitates exchanges for over 100 countries.

Place Your Order:

If your bank offers this service, you can place your order for foreign currency. You can typically do this through your bank's online banking platform or mobile banking app. Some banks may also allow you to place orders by phone or in person at a branch. When placing your order, you will need to specify the type of currency and the amount you require. Some banks may have minimum value requirements, such as a minimum of $20 USD at U.S. Bank.

Understand the Exchange Rate:

Before finalising your order, be sure to check the exchange rate offered by your bank. Compare this rate with the current market rate to ensure you're getting a fair deal. Bank of America, for instance, offers its Preferred Rewards clients a discount of up to 2% off the published exchange rate based on their tier.

Provide Necessary Information:

When placing your order, you will need to provide certain information. This includes selecting the account from which the funds will be debited and choosing the branch where you wish to pick up the foreign currency. You may also need to provide a valid phone number so the bank can contact you when your order is ready.

Review and Confirm Your Order:

Review the details of your order, including the estimated total, to ensure everything is correct. Then, confirm your order. Some banks may send you an email confirmation for your records.

Pick Up Your Currency:

Once your order is ready, you can pick it up at your selected branch. Don't forget to bring a valid form of identification, as this is often required for security purposes.

Be Mindful of Fees and Delivery Times:

Some banks may charge fees for foreign currency orders, especially for smaller amounts. For instance, Bank of America charges a $7.50 delivery fee for orders under $1,000. Additionally, take note of the delivery times, as these can vary. While some banks offer same-day delivery for certain currencies, others may require a few days to a week for your order to be ready.

Use a credit card with no foreign transaction fees

Using a credit card with no foreign transaction fees is a great way to save money when travelling. Foreign transaction fees are a surcharge that credit card holders pay for transactions processed outside of their home country. These fees are usually a combination of charges from the card issuer and the card network. They can add up quickly, especially when you're making a lot of purchases.

• Apply for the right card: There are plenty of credit cards that don't charge foreign transaction fees. Do your research and apply for a card that suits your needs. It's a good idea to do this well in advance of your trip, as it can take time to process your application and receive your card.
• Check the fine print: Make sure you understand the terms and conditions of your card. Every card is different, so check the pricing and fees section of your cardholder agreement to see exactly what charges you might incur.
• Be aware of dynamic currency conversion: When making a purchase, you might be given the option to pay in the local currency or your home currency. Choosing to pay in your home currency might seem convenient, but it usually comes with an additional fee and a poor exchange rate. It's almost always better to pay in the local currency.
• Look out for ATM fees: Withdrawing cash from an international ATM can trigger unexpected fees, and there may be daily withdrawal limits. Using an ATM in your bank's network or at a partner bank can help you minimise these charges.
• Plan ahead: Order your foreign currency from your bank before you leave. This can save you time and money, and you'll likely get a better exchange rate than if you were to wait until you're abroad.
• Use a digital wallet: In many countries, merchants are moving towards contactless payments. Setting up a digital wallet on your phone can make it easier to pay in stores, online and in-app, and it's more secure than carrying lots of cash.
• Be strategic: It's a good idea to have a mix of cash and card options when travelling. Use cash for small purchases like coffee and snacks, and save your card for larger expenses like restaurant meals and hotel bills.
• Don't forget about coins: If you have foreign coins left over at the end of your trip, consider donating them to charity. Banks typically won't buy back coins, but you might be able to exchange them at the airport or give them to friends who are travelling.

By following these tips and choosing a credit card with no foreign transaction fees, you can save money and have a more enjoyable travel experience.

Use a forex account

Using a forex account is a great way to save money when travelling and exchanging currency. Here are some tips on how to use a forex account to your advantage when travelling:

Understand How Currency Exchange Works

The currency exchange rate is the value of one country's currency against another. This rate fluctuates constantly, so it's important to check the rate before exchanging your money. Think of it like buying produce; sometimes you get more for your money, and sometimes less.

Get Cash at Your Bank Before Leaving

Visit your bank or credit union before departing to exchange your money for the currency of your destination. Most major banks offer this service for a variety of currencies and countries. You can also order the currency online or by phone and have it delivered to your home or pick it up at a branch.

Avoid Airport Currency Exchange Kiosks

The convenience of airport currency exchange kiosks comes at a cost. Their exchange rates are typically much less favourable than those offered by your bank, so you'll end up with less foreign currency. For example, if your bank offers an exchange rate of £72 per $100, an airport kiosk might only give you £67, costing you £5.

Use Your Forex Account Wisely

If you have a forex account, you can take advantage of better exchange rates and lower fees. Check with your bank to see if they offer this service and what currencies they support. With a forex account, you can hold multiple currencies and transfer money between accounts in different countries.

Pay Attention to Card Fees

Using your credit or debit card overseas may incur foreign transaction fees of up to 3% on every purchase. These fees can add up quickly, so read the fine print or contact your bank to understand the charges. If you have time, consider applying for a card that doesn't charge these fees, especially if it's a good travel rewards card.

Pay in the Local Currency

When given the option, always choose to pay in the local currency rather than your home currency. If you pay in your home currency, you'll likely be charged an extra currency conversion fee and get a poor exchange rate.

Know Your ATM Fees and Limits

Using foreign ATMs can be a convenient way to access cash, but be aware of any fees and withdrawal limits. Contact your bank to understand the fees and daily withdrawal limits for your account. If needed, ask your bank to raise the limit so you can withdraw larger amounts while travelling.

Use International Banking Apps

If you travel frequently, consider using an international banking app like Wise or Revolut. These apps make it easy to manage multiple currencies and transfer money between accounts in different countries.

By following these tips, you can make the most of your forex account and save money on currency exchange during your travels.

Exchange currency at a government institution

Exchanging currency at a government institution, such as a post office, is a convenient and safe option for travellers. Here are some detailed instructions and tips for exchanging currency at a government institution:

Finding a Government Institution

Firstly, you will need to locate a suitable government institution that offers currency exchange services. In many countries, the post office or a designated foreign exchange branch of the country's central bank may provide this service. It is always a good idea to research and confirm the availability of this service before planning your visit.

Comparing Rates

Before visiting the government institution, it is advisable to compare their exchange rates with those offered by other providers, such as banks or private money changers. Government institutions may not always offer the most competitive rates, so it is worth checking to ensure you are getting a fair deal. You can use online tools, such as currency converters or rate comparison websites, to find the latest rates and make an informed decision.

Understanding Fees and Charges

When exchanging currency at a government institution, be sure to clarify any associated fees, charges or commissions. These additional costs can impact the overall value of your transaction. Ask about any potential hidden fees, as these can affect the final amount you receive. Understanding the total cost of the exchange will help you make a more informed decision.

Timing Your Visit

It is worth considering the timing of your visit to the government institution. If you anticipate long queues or wait times, you may want to choose a time when the office is less busy, such as early in the morning or during non-peak hours. This can help ensure a smoother and faster transaction.

Carrying Necessary Documents

Don't forget to bring along the necessary documentation for the currency exchange. This may include your passport or other accepted forms of identification, as well as any relevant forms or declarations that the institution may require. Having these documents ready will help streamline the process and avoid any unnecessary delays.

Understanding Buy-Back Policies

If you anticipate having leftover foreign currency after your trip, it is worth inquiring about the government institution's buy-back policy. Some institutions may offer to repurchase unused foreign currency at a later date, which can be a convenient option. Understanding their policies and any associated fees will help you make an informed decision about exchanging any leftover funds.

Exchanging currency at a government institution can be a safe and reliable option, but it is always important to do your research, understand the rates and fees involved, and plan your visit accordingly.

Frequently asked questions