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When it comes to exchanging currency, there are lots of different options. But not all are created equal.
Depending where you exchange your money, you could end up paying a lot more in extra, avoidable fees.
Whether you’re paying for tuition in a foreign country, going on holiday or looking to send money to a friend abroad, knowing your options how to exchange currency is key. Read along as we go through them.
If you’re planning a trip abroad, you may be wondering: where is the best place to exchange my currency?
As a general rule, the more convenient the place, the worse the exchange rate.
Airports, touristic spots and hotels are some of the worst places to exchange your currency. Visiting your local bank branch and exchanging your currency there is a considerable option, but it can still cost you.
The one exception to this rule is online currency exchanges, which are convenient to use and can also save you a lot in avoidable fees.
|Wise is a great example of an online currency exchange that allows you to exchange your money at the mid-market rate.|
One of the best places to exchange currency is online, as it makes for a convenient, quick and comfortable option.
It can also be one of the cheapest and on top of that you can do it from the comfort of your sofa while watching Netflix!
In some cases, if you order a large amount of currency, you may also be able to save on shipping fees.
Also, with some providers, you can compare the various exchange rates of other online exchange services as well as banks, allowing you to exchange your money at the cheapest rate.
This way, you can find the best currency exchange online.
Exchanging money with your local bank is also another option to consider.
Before your visit, it’s a good idea to find out what the real exchange rate for your currency is, simply by checking online. That way, you can check what - if any - additional fees your bank charges.
You can either pick up your exchanged currency in person, or have your bank ship it directly to your home.
But if you want to avoid the extra fees associated with shipping, then it’s likely a better idea to pick it up in person.
Another option, if you travel frequently to a foreign country, is to simply open a bank account there.
This way, you shouldn’t be charged much in fees when withdrawing from your foreign bank’s ATM.
It will also simplify the process for future trips, as long as you keep your bank account topped-up.
|Setting up a bank account can take time, so you may want to try to do it in advance of your trip, or, alternatively, do it while you’re there so it’s ready for the next time. Or you can avoid the hassle and time involved in setting up a foreign bank account by opening a multi-currency account online.|
If you’re strapped for time or simply can’t be bothered to visit your local bank, then the next best option is exchanging your money at an ATM.
You should do this before leaving for your trip and make sure that it’s an ATM from your bank’s network. This should help you to avoid additional withdrawal fees.
Similarly, you might want to check if your bank has a foreign affiliate in the country you’re travelling to. If so, you can withdraw from your bank’s foreign affiliate ATMs. If doing this, it's best to withdraw large amounts to reduce the percentage of the withdrawal fees.
That being said, ATM withdrawal fees vary by bank and can be fairly high. This is why you may want to consider exchanging currency online instead.
When it comes to exchanging currency, it’s a pretty straightforward process. But there are a few things to look out for to get the best bang for your buck.
If you’re looking to exchange money, then it’s best to stay clear of these exchange options:
- Airport kiosks
- Touristic centres
The majority of these places know that you’re in need of foreign currency to pay for immediate things. As a result, they charge you more for less in return, allowing them to make bigger profits.
As previously said, “the more convenient the method, the worse the exchange rate.” On top of this, it can also be said that the more “last-minute-ish” the method, the worse the exchange rate.
An exchange rate is simply the price of one currency expressed in that of another. The table below compares the exchange rates of different banks against that of Wise. Go ahead and test it!
No matter what the reason you’re looking to exchange money is, the best options are online currency exchanges and your local bank branch.
By sticking to these options, you’ll save money on additional, unnecessary fees.
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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