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Where Is the Best Place to Exchange Foreign Currency?

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Before you head to Europe, Asia or the Caribbean this summer for your holiday, figuring out where to get the best exchange rate for money will save you the headache of finding a favorable rate as you adjust to the jet lag.

Consider trading your U.S. dollars for euros, pesos or yen before you start your vacation so you can find the lowest fees and the best conversion rate. If you're traveling to several different countries with different currencies, planning ahead will save you even more money and time.

The most convenient spots to exchange money, such as airports, train stations, hotels and tourist spots, are usually the most expensive locations. Waiting in a long line to get some cash can put a damper on your travel plans.

Here are the best places to exchange your money into the local currency before and after your vacation.

[Read: Best Checking Accounts.]

Best Place to Exchange Currency Before and After Traveling

All the fees and extra charges can add up quickly, especially for longer trips. Avoid paying transaction costs by heading to your bank or credit union to have some cash on hand for coffee, snacks and tips.

Banks and credit unions will exchange currency for you before and after your trip if you have a checking or savings account with them. This can be helpful in case you don't spend all of the local currency and the amount is substantial. Other financial institutions will provide the service if you have a credit card from the bank. The exchange rate at your local bank is usually better than using a currency exchange provider at the airport.

Many banks such as Bank of America and Citibank might not charge a fee and offer options such as mailing you the currency or conducting the transaction online. For larger amounts such as $1,000, many banks will require you to pick up the currency in person at the branch.

Ordering currency online is another option. Bank of America charges a $7.50 fee for foreign currency orders less than $1,000, but will waive it for amounts more than $1,000.

You can check out the exchange rates online and see which bank or credit union is offering the best conversion rate.

How to Exchange Currency

Start by checking with your bank online to see if it will exchange the currency you need. You can even order the money online and have it mailed to you if you are not able to go to a branch during regular business hours.

If you're going to a country that has restrictions on its currency for political or economic issues, your bank may not be able to access the currency. Currency from many African and Eastern European countries can only be exchanged at those countries' banks and ATMs.

One quirk is that some banks will not accept foreign coins, so consider that before you head to the airport at the end of your trip.

Here is a checklist:

-- Contact a bank or credit union to make sure it has the currency or will accept foreign currency and what the fees are.

-- Find current exchange rates through your bank, credit union or websites such as

-- Check the bank's exchange rate to make sure it's fair.

-- Arrange for pickup or delivery.

[Read: Best Savings Accounts.]

Where Else Can You Exchange?

Once you've reached your destination, you can also obtain more cash to pay for meals and shopping at mom and pop locales.

Using your bank's ATM or an ATM in its network and exchange providers like Travelex are two common options.

Your best bet is to get cash from an ATM, because many banks will reimburse you for the fees as long as you use one from their network. Look for an ATM that is located within a building or in popular tourist areas that likely do not have skimmers so you don't have to worry about having your personal information stolen.

Banks typically charge either a flat fee or a percentage such as 1% to 3% of the amount you take out. Determine your bank or credit union's policy on reimbursing ATM fees.

Download your bank's app ahead of time to find out where the closest ATM is. Consider taking out a larger amount if your bank charges a higher fee. If you cannot find an ATM that is in your bank's network, plan on also paying extra fees to use it.

Places to Avoid Exchanging Currency

The worst places to exchange currency are at airport kiosks, hotels and tourist centers, because the conversion rates are usually not in your favor.


"Not only will you be hit with extra service fees when going with these methods, but the exchange spread, which is the rate the business will give you when you are selling your U.S. dollars to them minus the rate they will give you when you are buying U.S. dollars from them is very high," says Derek Horstmeyer, an assistant finance professor at George Mason University in Fairfax, Virginia. "This means every time you go to a bank or a foreign exchange kiosk, you will lose 1% to 2% in a nonfavorable exchange rate when changing your money. This goes for redeeming traveler's checks as well and other comparable cash items."

[Read: Best CD Rates.]

Alternatives to Exchanging Currency

Instead of exchanging currency, consider using U.S. dollars, or prepaid cards, credit cards or debit cards since even the smallest businesses, such as food trucks, often take payments electronically. Many countries will accept the U.S. dollar.

Many credit or debit cards offer a 0% foreign transaction fee, which you can use for dining out or buying museum, theater or sporting event tickets, Horstmeyer says. "A number of retail credit cards and most business credit cards now state right up front that they are 0% foreign transaction fees, which is a phenomenal feature to have on a credit card," he says.

Some banks offer travel credit cards for frequent travelers or people living abroad. Ashleigh Scanlan, an American who moved to Australia several years ago, says her card allows her to put the money in U.S. currency and switch it to whatever countries she travels to. "Currently, I have about five different currencies on the one charge," she says. "I just switch it when I enter into another country."

Check with your bank to see what the limit is for withdrawing money daily or weekly so you don't reach the maximum if you're making larger purchases.

Paying for your purchases with mobile payment providers such as Google Pay, Android Pay or Apple Pay are also options that can help prevent fraud while you are traveling




Just in case... LOL




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US retail banks and airport places like travelex usually have terrible rates, even if they don't charge a "fee", the fee is built into the big spread on their exchange rate.  I just checked travelex site, their sell rate on Euros is 0.8108, the interbank market rate displayed on Kitco is 0.8905, that's a 10% spread!  Many people mistakenly believe they are getting a fair rate just because there are "no fees".  

Almost anywhere in Europe, Asia, or the Mideast, even the worst airport exchange kiosks will give you a tighter spread than that.  For some reason foreign exchange institutions in the US are very stingy on rates.

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BA, good article. When I was traveling before retirement I use my credit union debit/ATM card. Not only did everyone take it as payment, but i got the best exchange rate when I withdrew money using the ATM. (Just be sure as you said to make sure the ATM you use is not a skimmer.) And, in addition, my CU charged no transaction fees. Good deal all the way around. Thanks for the post my man!!

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