Congratulations on finally making the decision. You are going to your favourite place abroad which you always dreamt of going. But there is a hitch – the currency of your country does not work there. You might think of exchanging it to that currency once you reach there. But this is not that a good option. In this article, we shall see some of the good and bad options for getting that cash to spend in your dream destination.
Why should I exchange currency?
Each country in this world has its own currency which has its own value. For example, the US has its US Dollars, the European Union has its Pounds or Euros, India has its Rupees, Saudi has its Dirhams, Japan has its Yen, etc. The currency of one country will not be valued in another. International travellers have to convert their money from the currency of their homeland to the currency of the destination. What they basically do is to purchase the currency of the destination country with their money.
But this is not that easy. The currency exchange rates fluctuate each day, depending on the condition of the international market and the economic status of the countries.
With these details, let us now look into a few bad ways to convert currencies.
Bad ways to convert currencies
Converting the currency in Airports, currency exchange centres and so on are not so pocket-friendly because there always will be some commission levied. This commission will mostly be higher than other methods we discuss in this article.
The same way, using your debit or credit card directly in a foreign land is also not a good idea because you will be levied higher transaction rates (up to 4% in each transaction).
Never get fooled by the “No Commission” boards found outside the exchange offices. The commissions will be included in the exchange rate itself.
Good ways to convert currencies
#1 Choose fee-free cards for overseas spending
Some banks offer fee-free spending in foreign countries through specific debit or credit cards. The exchange rate you will be communicated will be the rate found on the day of the transaction and not on the date of purchase. This will protect you against inflation during the trip.
You may also choose e-wallet cards like the Curve Smart card and link it with your credit or debit card. This prevents any foreign transaction charges by your bank.
A prepaid card will also be a good idea if you want to save money and also if you are on a budget.
#2 Pay in the local currency
This is a golden rule when you are on an overseas tour. Though it might be tempting to choose your own currency, remember that the money charged will depend on the exchange rate fixed by the foreign bank. Also, carry some change in the foreign currency to tip off or do some street-side shopping.
#3 Find the best ways to cash out
If you draw from local ATM’s, the bank might charge you transaction fees. So, try to cash out money from the special cards like Curve Smart card. This might save some money on the exchange rates.
So, these were a few tips on making the most out of your savings for a foreign trip. Never pay an extra penny and waste your precious savings on it. Happy Journey!!
