Travelling abroad? Don’t squander your hard-earned cash by getting gouged on exchange rates and hefty service charges. Here are four of the most expensive ways to exchange money abroad, along with four cheap and convenient alternatives.
DO NOT exchange money at the airport
Every international airport has currency exchange booths lining the terminal walls. While they offer convenience, they offer little in terms of value. In fact, if you include fees and the margin baked into the exchange rate, you could be getting charged in excess of 10% on top of the spot market exchange rate.
DO NOT exchange money at your hotel
Same as airports, foreign exchange desks in hotels offer terrible value. While they’re convenient, they typically have a high margin built into the exchange rate and numerous hidden fees. Consider using them only in case of an emergency.
DO NOT use prepaid travel cards
Prepaid travel cards come with annual fees, a fee for international transactions and an additional fee when withdrawing money from ATMs. For example, the BMO Prepaid Travel MasterCard charges a $6.95 annual fee, a 2.5% foreign transaction fee, plus a $5 out-of-country ATM fee, which is on top of the fee the ATM operator charges (usually around $3). If you take out $100 it could cost you as much $10.50, which is equivalent to 10.5%!
DO NOT exchange money at your retail bank branch
Buying U.S. dollars at your retail bank branch costs more than you might expect. Banks rarely break out their margin from the spot rate, making it hard to judge how much they’re charging you. However, estimates range from 2.5% to 4%, which is more than you need to pay.
DO get a credit card that subsidizes foreign transaction fees
The Rogers Platinum MasterCard offers 4% cashback on purchases made in a foreign currency. While it does charge a 2.5% foreign transaction fee, you end up netting 1.5% cash back on foreign purchases . Compare that with a rewards card that earns you 2% cash back and charges you a 2.5% foreign transaction fee, where you lose .5% on every foreign dollar you spend on purchases.
DO exchange money online
There are some exceptionally competitive online currency exchange businesses in Canada. Knightsbridge , for example, offers conversion fees as low as .5% over the spot rate and guarantees it will beat any quote.
You might also like
- A health and care centre in Northern Ireland by Hoskins Architects and Keppie Design engages
- Hopkins Architects’ Institute in the Park at Alder Hey Children’s Hospital is designed
- 5 Spectacular Places to Watch the Sunrise and Sunset
- The World’s 6 Most Famous Streets
- 6 Most Beautiful Natural Pools in the World