Travelling No-No's: The most expensive currency conversion methods revealed
In the rush of organising holidays, getting to the airport, and then making the most of your precious time away, it can be easy to let some things slide. Yet, when it comes to things like currency conversion fees when you’re spending money overseas, those little things can really add up.
In our currency conversion tips below, we highlight the most expensive currency conversion methods – and also the cheapest – to help you save money on fees so that you have more spending money and get more out of your travels.
The most expensive currency conversion methods
1. Airport exhange booths - By far the most expensive way to buy currency is at an airport. With little competition, airports offer the poorest exchange rates and don’t offer a wide range of currencies. Avoid buying at the airport and instead purchase currency before you leave. Even withdrawing cash at a foreign ATM is usually cheaper than buying currency at these booths.
2. Rate Booths - Not far behind airport exchange booths are expensive rate booths – those small booths in popular tourist areas that offer bad exchange rates. Avoid these.
3. Withdrawing cash daily - If your debit or credit card charges ATM withdrawal fees, you’re going to stack up the fees if you withdraw cash every day. Withdraw large amounts of cash each time, and store what you don’t need in a safe place, such as a hotel safe.
4. Using a credit card that charges international conversion fees - Most credit cards charge a fee if used outside of Australia. This fee is often around 3% of the purchase price, which can really add up when you’re using your credit card every day. Some credit cards waive this fee, making them ideal when you’re spending money overseas.
Why not check out our guide on how to get the most out of your credit card when travelling overseas.
5. Using a credit card that offers poor exchange rates - While credit cards are more likely to offer a reasonable exchange rate on purchases, not all do. Travel credit cards are more likely to offer a good rate, and with some travel cards you can also lock in a rate when you load the card, so you know exactly how much you’re spending.
6. Paying in Australian dollars instead of the local currency - It’s safe to assume that if you’re given the choice between paying in Australian/American dollars or in local currency, you should choose local currency. Most vendors will give you a poor exchange rate when you pay with foreign currency.
The cheapest currency conversion methods
1. Buy your currency online - This is one of the best currency conversion tips, as it’s definitely one of the cheapest options. Buy your currency online, in advance, and you’ll get a better exchange rate. You can pick it up at the airport or a range of other outlets. Travelex allows you to pick up your currency from your local Australia Post Office.
2. Use a fee-free credit card - Use a credit card that doesn’t charge international conversion fees, such as the 28 Degrees Platinum Mastercard.
3.Buy your currency at the bank - For common currencies, like USD, EUR and GBP, your bank will probably have a decent exchange rate.
To wrap up...
Avoid poor exchange rates through airports and exchange booths; pay with local currency; look for a credit card that offers low or no fees; and buy currency in bulk.
Remember that the further you are from Australia, the worse the exchange rate that you’ll get for your Australian dollars will be.
And the more rare the currency, the worse the exchange rate will be.
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