Traveling to a foreign country is an exciting experience, but one of the most critical aspects of planning your trip is figuring out how to exchange your US dollars for the local currency in the most cost-effective way. Exchanging money improperly can lead to unnecessary fees, poor exchange rates, and inconvenience when you need cash abroad. In this guide, we’ll go over the best ways to exchange your money, including how to request foreign currency from your bank, set up an account with Western Union to send money to yourself, withdraw cash using an ATM, and why exchanging currency at the airport should generally be avoided.
Ordering Foreign Currency from Your Bank Before Travel
One of the best ways to get local currency before you travel is by ordering it from your bank. Many major banks allow account holders to request foreign currency in advance, so you can arrive at your destination with cash in hand. To do this, first check if your bank offers foreign exchange services, which you can usually find on their website or by calling customer service. Major banks such as Chase, Bank of America, and Wells Fargo provide this service, often at better rates than airport kiosks.
Before placing an order, it’s a good idea to compare exchange rates with other services like Western Union or online currency exchange platforms. If your bank does provide foreign currency exchange, you can typically place an order either online or in person at a branch. Since banks don’t always keep every currency in stock, you should allow a few days to a week for processing. Once your order is ready, you’ll need to visit a branch to collect your money. The main advantage of ordering from your bank is that you get competitive exchange rates with minimal service fees, making it one of the most cost-effective ways to obtain foreign currency. However, this method does require planning ahead, and not all banks offer every type of currency.
Using Western Union to Send Money to Yourself
If you’re already abroad and need cash, another option is to transfer money to yourself using Western Union. This is a convenient way to access money without carrying large amounts of cash while traveling. To use Western Union, start by creating an account on their website or through their mobile app. Once your account is set up, you can fund your transfer using a bank account, debit card, or credit card. When sending money, choose a pickup location in your destination country where you can collect the cash. After completing the transaction, you’ll receive a tracking number, also known as an MTCN, which you’ll need when picking up your money. To collect your cash, visit the designated Western Union branch with your passport and tracking number.
The advantage of using Western Union is that it is widely accessible in most countries and allows you to send money to yourself securely. However, the downside is that the fees can be high, depending on the amount you send and the method you use to fund the transfer. Additionally, the exchange rates may not be as favorable as those from a bank or ATM.
Why Exchanging Currency at the Airport is a Bad Idea
Many travelers arrive at their destination without local cash and decide to exchange currency at the airport. While this is certainly an easy option, it is typically the most expensive due to poor exchange rates and high service fees. Airport exchange kiosks often charge high commission fees or significantly mark up the exchange rate, making it one of the worst ways to exchange money. Since travelers have few options upon arrival, exchange services at airports take advantage of the lack of competition by offering unfavorable rates.
If you absolutely need local currency upon arrival, it might make sense to exchange a small amount at the airport just to cover initial expenses such as transportation to your hotel. However, it’s best to avoid exchanging large amounts at the airport and instead use an ATM or bank exchange service once you reach your destination.
Using an ATM in a Foreign Country
One of the most convenient and cost-effective ways to get local currency is by withdrawing money from an ATM in your destination country. Before you travel, check with your bank to see what fees they charge for international ATM withdrawals. Some banks impose foreign transaction fees or out-of-network ATM fees, which can add up if you withdraw money frequently. To avoid any issues while abroad, notify your bank of your travel plans in advance so your card isn’t flagged for suspicious activity.
It’s also helpful to research ATMs in your destination country using your bank’s mobile app or online tools like the Visa or Mastercard ATM locator. When withdrawing money, take out larger amounts at once to minimize ATM fees. If possible, use ATMs located at banks rather than standalone machines in convenience stores or tourist areas, as bank ATMs tend to be more secure and offer better exchange rates.
Using an ATM is usually one of the best ways to exchange money since ATMs provide favorable exchange rates compared to currency exchange booths. However, some ATMs impose daily withdrawal limits, and there’s always the risk of ATM fraud, so it’s best to use machines in well-lit, reputable locations. If your bank offers a debit card with no foreign ATM fees, such as Charles Schwab or Fidelity, this can be a great way to avoid unnecessary costs.
The Best Strategy for Currency Exchange While Traveling
The best approach to exchanging money while traveling depends on your needs and travel style. A smart strategy is to order foreign currency from your bank before you leave so you have some cash on hand. Once you arrive, using ATMs will generally provide the best exchange rate with the lowest fees. As a backup plan, you can use Western Union to transfer money to yourself in an emergency. The one thing to avoid, if possible, is exchanging money at the airport, as the costs are usually much higher. By planning ahead and knowing your options, you can save money on currency exchange and ensure that you have access to local cash when you need it.
