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We all have to do it and we’ve all seen those “commission free” signs at currency exchanges.  I don’t know about you but I think those “commission free” ads are pretty much worthless.  Instead of these stores charging a commission, they just give you a really poor exchange rate.  So, where’s the best place to exchange money?

First, I’d recommend using an ATM once you’re at your destination.  Sure you’ll pay a fee but I’ve noticed it’s drastically less than these “commission free” sites and if you get a card like Schwab, you won’t pay a foreign ATM fee.  Another tip when using foreign ATMs is to try to withdraw money up to the threshold of the fee increase.  There’s no point in withdrawing $100 each time and paying the same fee 5 times if you can just pay it once and withdraw $500.

Next, try using plastic.  A lot of cards now have no foreign transaction fees.  Whenever possible, I try to pay everything with a credit card and only pay cash for small items or unless absolutely necessary.  It means I carry less cash, can dispute charges, and have a better handle on my finances overall.  

Finally, I’d say go to your financial institution.  A number of large banks will exchange your currency for you for a fee even though you will need to plan ahead by a  few days.  If you’re going this route, you should ask to see if they’ll buy back the currency as well.  This is really only useful if you’re the type of person who MUST have local currency as soon as you hit the ground.  

If I’m in a pinch, I’ll bite the bullet and exchange the money at the airport.  But even then I ask myself, will I be back?  I have envelopes of leftover money from the countries I’ve visited and I just file and mark them via country.  My intent is that I’ll save myself the hassle in the future but even if it doesn’t, it’s cool to look at every now and then.  Also remember that coins are pretty much useless outside of the country so either use them at the airport for small items, exchange them into bills, or just donate them.  

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