If you are travelling to a foreign nation then getting your currency converted is an obvious requirement. The typical method most of us follow is going to a bank or a Forex service and get our cash converted. This method is usually applied and I won’t say that it is wrong at all. I rather recommend and encourage everyone to follow this method as this is the simplest. However, due to a little amount of negligence one can incur a good margin of losses in foreign exchanges.
The best way to spend money when you’re outside your country is by the use of a debit card. This gives you an advantage of the ability to buy without any cash as most retailers in the world today recognize Visa, MasterCard and Amex. Out of the blue, if you reach a place where your card does not seem to work or the retailer does not accept cards then you can check-in any ATM and withdraw cash. You are charged a fee for the conversion and for the use of the card internationally. You are also charged if you use an ATM outside of your bank’s network. For example, if you have an account in HSBC and you use the ATM of Barclays then you’ll be charged a fee. Not so, if you use HSBC’s ATM itself.
Before setting off for your journey make sure that you contact your bank and inform them of your overseas visit. This action is necessary because when banks detect the card’s activity outside its usual geographical limitations, they block the card. Hence informing them beforehand avoids all trouble. In addition to that you can also consult the bank before leaving the country and make sure that the card works and is accepted to the land where you are heading. Some countries support 5-digit pins and some just 4-digit. You can have all your doubts cleared by consulting your service provider way ahead before leaving the country. I recently also came to know, in some nations a pin cannot contain (0) zero.
If you don’t have a bank account/debit card then you have the option of either carrying cash or getting a traveler’s card. A traveler’s card works on prepaid system with all the features of a credit card. You can get these cards from banks with the required credentials and a particular amount which you want to be credited to your traveler’s card. With it, you can make all your travel expenses and as said before has the benefits of a credit card. In case of damage or loss or theft, you can ask for a replacement too preventing any financial losses. A fine example of such a card is the Visa TravelMoney Card.
Another option is traveler’s checks. There was a time when traveler’s checks were the most commonly used means of money abroad. Traveler’s checks are like credit cards. You get them from banks and sign them as soon as they are obtained. Further, whenever you intend to use the check, you need to sign it again in the presence of the seller. Just like credit cards, traveler’s checks can also be replaced in case of loss or damage or theft. However, with the ever improving technology, traveler’s checks have become obsolete. Rarely, do retailers these days accept them and new retailers are not even familiar with the concept. It can also be said that traveler’s checks have been replaced by traveler’s cards.
If the above mentioned methods don’t appeal to you and you still insist on carrying cash then that is fine as well. For not losing out a lot on commissions at foreign exchanges, get all your cash converted only once. In other words, don’t convert the same money twice. For example, if you have $100 and you convert it to pounds, you are likely to receive a little less than 60 pounds whereas the exact conversion exceeds 60 but the rest of the money is lost in commission at the foreign exchange. Further if you convert these Pounds into Euros, you receive some 65 Euros while the exact conversion gives more than 70 Euros. In this way, converting your cash repeatedly deducts money from the grand total due to commissions. Although, there is no prohibition against carrying cash but a major disadvantage that cash has is the fact that it can’t be recovered if stolen or lost.