November 24, 2017

What You Need to Know about Foreign Exchange

More and more Australians are travelling overseas, thanks to the strong Australian dollar and airfares that have become more affordable. One main consideration when traveling to a different country is how to get the best currency exchange rates. By knowing how far your dollars will get you, you’ll be able to create your travel budget and set expectations when it comes to accommodations, food, transport, shopping, and other expenses while abroad.

Did you know...

That Foreign Exchange is traded 24/7, around the world. This means that foreign exchange rates can change every minute.

Here are some of the things that you need to know about foreign exchange and the best way to exchange money: 

  • Foreign exchange is traded 24/7, around the world. This means that foreign exchange rates can change every minute. These changes may not look much, but it is important to look into it on a regular basis.
  • In most cases, international currencies “float”. This means that their relative value is set by traders who are buying and selling various currencies around the world.
  • One way to get the best currency exchange rates is to check the fees and commissions. Compare the offerings of several providers and choose the one with the lowest possible fee.

What are the best ways to exchange money when traveling overseas? 

  • Buy online. The digital age has enabled foreign exchange to be done online. Aside from convenience, buying currency online usually offers better rates. Just buy in advance as it may take several days before you can get the money from the pick-up location.
  • Go to a specialist money exchanger. If you need larger amounts of certain currencies such as US dollars, heading to a specialist money exchanger in the city can be the cheapest way to buy currency. You can get the best currency exchange rates by shopping around to look for competitive rates.
  • Exchange money through your bank. Some people think that it’s expensive to buy currency in an Australian bank. The truth is, it depends on the currency that you need. For instance, many Australian banks don’t offer competitive rates when it comes to US dollars and Euros. However, you may get the best currency exchange rates when you buy currencies such as South African Rand or Chinese Yuan.
  • Buy currency on your destination. Many countries offer competitive foreign exchange rates and in some cases, buying currency overseas can be a better option compared to doing it before you leave Australia.

Got other ideas on how to get the best currency exchange rates? Share your tips in the comments section. 

About the author  ⁄ Marxa Dillan

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