10 Ways to Get the Best Currency Exchange Rates
Written by Jay Ho
I travelled to 23 destinations in the 2 years that I lived in London, England. Every trip taken was with a budget airline (Ryanair, Easyjet, Wizzair, Norwegian, etc.) I learnt a fair few things about travelling so here are 10 ways to get the best deal on foreign currency exchange:
You’ve saved money on flights and your hotel room – now get the most bang for your buck, Euro, or baht! Our guest financial expert Claire Connachan shares 10 insider tips on how you can get the best exchange rate on your travel money:
1. Know the jargon
Foreign exchange has its very own language. Learn the lingo so you don’t get taken advantage of:
sell rate: what you get when you exchange pounds
buy rate: what you get when you exchange leftover foreign currency
interbank rate or bank to bank rate: the rates banks use amongst themselves
2. Learn more about your currency
The Canadian Dollar, Australian Dollar, US dollar and Euro exchange rate are fairly straightforward. Some foreign currencies have odd rules that you need to watch out for.
- The Moroccan Dirham cannot be exchanged internationally
- Cuba has two currencies – one for tourists and one for locals!
- Cambodia and many South East Asian countries use US dollars as their second currency, but your dollars need to be in great condition.
3. Watch the exchange rates
Check the online exchange rate on Google.com or www.xe.com on your chosen currency so you know what makes a good exchange rate. Currency fluctuates constantly so the price will never be the same as the previous day.
*When is the best time to change currency?
Give yourself at least 1 month of time to watch currency movements. Buy when the rate is climbing and the pound is strongest ie. when you get the most euros, dollars or other currency for your pounds. When I lived in London I ended up choosing ThomasExchange.co.uk as my go to place to exchange money. You make your order online and come to a physical location to pay and collect.
4. Shop around for your holiday money
Currency exchange rates not only fluctuate from day to day, but also from provider to provider. Prices are not the same across the board so it’s extremely important to shop around for the best exchange rates before you purchase.
*Where is it best to exchange currency?
There’s not one foolproof place to get the best rates on foreign currency. Avoid exchanges money at airports at all cost. If you have to do so only exchange enough to pay for transit into the city centre. If you choose to use a credit or debit card for some of your purchases abroad, always ask to pay in local currency to avoid something called a ‘dynamic currency conversion rate’ which businesses will apply to convert your purchase into sterling. If they ask you to pay in pounds, always say no or else you will be fattening some banks vaults some more.
5. Negotiate discount rates
Exchange rates are not set in stone. If you are exchanging huge quantities this gives you leverage to ask for another 0.5% which goes a long way. Besides, bartering is fun and there’s always other exchange bureaus wanting your business.
6. High street vs online
If I am exchanging for Euros then I go to ThomasExchange.co.uk to make my booking. Here you can have the money delivered through Royal Mail or pick it up yourself (easy, safe option). I avoid the high streets of London to exchange my money since the rates simply aren’t great. However if I am headed to Eastern Europe then I make sure to bring cash and exchange it at a local place for the best rates.
7. Watch out for credit card fees
Each card provider has a different policy, but fees usually start around £1.50 so keep that in mind when you are using your card to exchange currency. A good rule of thumb: Exchange only one time for your trip.
8. Travellers’ cheques
If you don’t feel comfortable carrying large amounts of cash with you then a traveller’s cheques (American Express) is a good alternative. It provides you with protection in the event that it is lost or stolen. The downside to this is that there are limited currencies available on traveller’s cheques.
9. Prepaid cards
Another alternative to carrying huge wads of cash around is a pre-paid card. The exchange rate is set on the day that you purchase this card so you don’t have to spend your trip trying to figure out conversions. There are some limitations: including purchase costs or hidden charges.
10. Don’t be fooled by the Signs
Exchange bureaus will advertise things like ‘0% commission’, ‘best rates on the high street’ or ‘guaranteed best rates’. Do not believe their BS. For example, 0% commission sounds wonderful but rates can be poorer as commission is hidden in their exchange rate margin. Shop around, know your currencies and exchanges and don’t be bamboozled by high street marketing!
The Majestical Newsletter
Get our latest majestical deals and articles sent straight to your inbox!