Mo’ money, mo’ problems
International travel brings about a host of questions to consider, including how to go about minimizing foreign currency conversion fees. Should you hit up the ATM in your destination country? Use a debit/credit card? How about that little kiosk at the airport with the flashy “GUARANTEED BEST RATE” signs? Or is it just easier to carry around a bag with a dollar (or Euro) sign on it?
Here’s some of what I’ve been able to dig up on this topic as Caitlyn and I get ready for our Canadian trip:
Some ATMs tack on an additional 3-8% in fees but there are banks out there that charge no fees, including Bank of America. There are also large networks of ATMs such as the Global ATM Alliance, which can help minimize costs. Of course, you want to be careful with how much money you take out of the coffers because you neither want to lose it in a mugging or take out too much and wind up losing money when you have to re-exchange it for U.S. currency at the end of your trip.
Credit unions sometimes substitute an ATM card with a debit/credit card; such is the case with our credit union. Percentages vary by bank, but expect anywhere from 1-3% in fees. With our particular credit union, the “cross-border” and “conversion” fees totals roughly 1 percent; however, TripAdvisor and Reuters note you can score a fee-free card either through Capital One, Discover, Chase or TD Banknorth, the latter of which also has locations throughout Canada.
The biggest “rip-off” of the bunch, according to NBC News, are those ubiquitous kiosks you see at the airport, which can charge upwards of 20% in fees – yikes! Avoid these at all costs, unless you’re in an emergency situation and need money on the spot.
Both banks and the Internet aren’t bad options, just be cognizant of delivery fees (sometimes $10 and up) and fraudulent websites.
In the end, unless you have a fee-free credit card, you’re probably going to pay some premium for your vacation. That said, the way I look at it is like this: Right now the U.S. dollar nets me $1.026 Canadian. That means I get $2.60 in bonus money for every $100 I spend so, even if the fee is 1%, I’m still ahead s $1.50. Of course, this is different if you go to a country where the U.S. dollar is worth less than your destination’s currency.
Do you have any tips on converting currency for low rates? Check Independent Traveler for more tips.