International Currency Exchange Information that can save you Money
How does the currency exchange system work? We all agree that getting a deal is always a priority when we travel. We want a deal on the flight cost, a deal on hotel accommodations and we want to find the best food for the most reasonable price. People want to travel, but they want to do it without going deeper in debt. One deal that seems to be overlooked when we travel to other countries is finding the right currency exchange deal because that can take some doing, thanks to the nature of the currency exchange market.
So before heading to exciting and beautiful Morocco, consider that the currency exchange market is a for-profit business and is one of the building blocks for international trade and travel. It has no governing body and has no headquarters or local offices. The exchange market regulates itself based on several political, social and economic factors and is in a constant state of change. It fluctuates hourly and billions of Dollars are exchanged every day.
In order to save money when you exchange currency, you need to do some homework about the currency pair you’re exchanging and have a strategy which includes, how, when and where to make an exchange. It’s hard to tell how different exchange merchants make money, but you can get an idea by contacting a professional currency broker. Some traveler’s believe that waiting till you reach your destination is the best way to exchange money, but most of them are not too concerned about saving money when they follow that belief. Other travelers say international banks will give you the best rate, even though they charge a transaction fee for every exchange. That may be true if you’re comparing the bank to credit card companies, or airport merchants or a hotel. Those merchants have huge overheads and rely on the currency exchange market to add hefty gross profits to their balance sheets.
The fact is: It’s hard to tell if you’re saving any money when you make an exchange unless you get accurate information about the real time rate when you make an exchange. How do I know if I am getting a real time rate? You won’t know if you use a bank, or a credit card company, an airport merchant or a hotel. Their exchange rates are so loaded with profit, so the real time rate is completely hidden. A professional currency broker will give you a real time rate when you’re ready to exchange money and most of them don’t charge transaction fees or surcharges. A professional will help you develop an exchange strategy while you’re planning the trip, so you don’t get caught in a sudden currency surge that can happen between currency pairs. Travelers have had their trip ruined by a currency pair that surged in value overnight. A broker will help you average exchanges while you’re planning the trip. Averaging is exchanging small amounts of money at different times during the planning stage of the trip. A currency broker does make a profit, but you still save money when you compare them to the alternatives.
Other travel tips: Some countries limit the amount of currency you can carry through customs, so check with your broker and stay within the limit. Always carry cash in a money belt or leg pouch that’s secure and out of site and use hotel safes when you reach your destination. Follow local security tips and remember common sense is your best security tool when you use it.
Contributed by Andrew Carter