Currency Exchange: What You Need to Know

If you’ve ever paid a friend for your share of pizza with Venmo or used your Apple Watch at the grocery store, you know cash is becoming less important than it used to be. This is true when traveling abroad as well. You can pay via credit card in most places, including restaurants, major attractions, and airports. So is currency exchange even necessary? Yes! It’s still important to have local currency on hand when traveling because smaller establishments, street food stalls (mmm street food), and market vendors likely won’t take credit cards. In this article, I list the ways you can get foreign currency and share which one I think is best.

Currency exchange before your trip

You can go to your bank, credit union or local AAA branch to get foreign currency before you travel, but you will be subject to unfavorable exchange rates, meaning you’re going to pay more for the money than it’s actually worth. It’s generally not necessary to have local currency ahead of your trip, but if you want to be overprepared or you’re nervous about not having cash on hand when you arrive, this is an okay option.

Currency exchange at the airport

Every airport has currency exchange booths where you can exchange your money for local currency. I would urge you to explore other options before resorting to this. These places make money by exchanging money at poor conversion rates and keeping the difference. Avoid this option if possible.

Using an ATM when you arrive at your destination

ATMs are everywhere and are easy to find, especially in and around airports. You will get the most favorable exchange rate by simply using your ATM card to withdraw cash once you’ve made it to your destination.

The only issue with this option is you will likely have to pay an ATM fee if your bank’s ATM is not available. To get around this, I use a Fidelity Cash Management Account, which doesn’t charge a foreign transaction fee and reimburses ATM fees, regardless of which ATM you use. This is especially helpful in places like Vegas, where notoriously high ATM fees are the norm, or Argentina, where most ATMs charged $10 USD every time we took money out of the ATM. Knowing Fidelity would reimburse us for those fees was a huge relief during our three weeks in Buenos Aires.

Full disclosure: Fidelity is my former employer and that makes this recommendation biased, but this card has honestly solved a lot of problems during our travels and has reimbursed me hundreds of dollars in ATM fees over the years.

What to do with leftover currency

You can exchange leftover money at the airport or see if your bank or credit union will buy the money back from you, but, again, you will have to deal with the unfavorable exchange rates mentioned above.

I find foreign currency makes a great souvenir or keepsake! It doesn’t take up much space or weigh your bag down and keeping it probably costs less than purchasing a bunch of trinkets.

What’s your strategy for exchanging currency when you travel? Let us know in the comments!

4 thoughts on “Currency Exchange: What You Need to Know

Leave a Reply

Your email address will not be published. Required fields are marked *