Traveling internationally? How to order foreign currency ahead of time.

Do you have a big international trip coming up? Before you go, consider converting some of your money to the local currency of your destination before you leave. Airport exchange rates are often unfavorable, and you may need cash to take a cabin or grab a bite to eat when you arrive.

Having foreign currency in advance can also help you avoid scams that target tourists. Regardless of the destination, carrying some of that country's currency can help you be prepared and protect you from scams. Follow this step-by-step guide so you're ready when the big day arrives.

It can be convenient to buy foreign currency before going on an international trip. Follow these steps to ensure you have cash in the correct currency before you start your journey:

Enter your destination: Although some countries have a common currency such as the euro, many have their own unique currency. Knowing your destination will help you identify the currency you need.
Research exchange rates: Some currencies have similar values to the US dollar, but others can vary significantly. If you know what currency you need, look into it exchange rate with the dollar.
Compare currency exchange rates: Check rates for your currency at your bank, local currency exchange, and online currency exchange services. If you plan to convert a lot of cash, a small difference in fees can be significant.
Place your order: After deciding who has the best exchange rate, place your order. You will need to share a few details, such as the currency you want to buy, the amount, and the delivery method. For example, physical locations may allow you to choose personal collection or home delivery.
Confirm your order and pay: Before you complete your order, double check the exchange rate and confirm that it matches the rate you expect. If it is, confirm the order and make your payment.

If you place a currency order in person, ask the representative if there are any transaction fees or delivery charges. If possible, use a fee-free payment method, such as bank transfer or debit card, when paying for your order. Keeping fees low is always better, so it's a good idea to check for additional fees at each stage.

We've discussed some reasons you might want to buy foreign currency in advance, but like all financial services, there can be pros and cons.

Advantages

Convenience: Buying foreign currency in advance allows you to pay for transportation, meals and tips as soon as you arrive.
Avoid high fees: Having foreign currency in advance can help you avoid paying high fees at the destination airport or ATM.
Avoid scams: Buying foreign currency in advance can help you avoid scams. For example, you could buy unknowingly fake money or pay terrible rates without realizing it.
Be prepared: Some merchants may not accept card payments while abroad. Having foreign currency helps ensure that you will always be able to pay.

Disadvantages

Variations in rates: If the foreign currency weakens against your currency between your trip and when you buy it, you could miss out on potential savings.
Fees: Banks and currency exchanges charge fees for currency conversion, which can sometimes be a significant expense. You may be able to save money by using a credit card with no foreign transaction fees and withdrawing cash at local ATMs.
Time and planning: We are all busy, and you have to take time out of your day to buy foreign currency. But more than that, processing an order for foreign currency can sometimes take a few days, so you may not be a viable option at the last minute.
Carrying cash can be dangerous: Exchange of lost or stolen money is almost impossible. So it can be dangerous to carry a lot of cash, especially when traveling to countries where pickpocketing is common. However, you can reduce your risk by limiting the amount of money you carry and keeping it hidden when you're out and about.

There are some steps you can take to get the most value from your conversion. One of the most important things to do is research exchange rates.

Rates change often, and you never know what the future holds. Still, monitor rates in the weeks before your trip and compare them to previous rates. If you find that rates are favorable at a particular time compared to where they were in the recent past, it may be a good time to go ahead with your foreign currency purchase.

Once your trip starts, another trick is to always pay in the local currency if you use a card. Some merchants may offer dynamic currency conversion (DCC) at checkout, but this often comes with unfavorable exchange rates and additional fees. You can always do a quick calculation on your phone to see how much the total is in US dollars to avoid this costly service.

You can also carry a travel credit card to match your cash. Not all overseas shops accept card payments, but many do. Carrying a card with no foreign transaction fees can help you reduce reliance on cash and pay less in currency conversion fees.

While it's a good idea to carry at least some of the local currency on you, there are a few downsides to ordering foreign currency ahead of time.

Another simple option is to withdraw local currency from an ATM in the country you will be visiting with your debit card. This means you will be out of cash at the start of your trip, but ATMs often have competitive conversion rates and are usually widely available. (You may want to avoid ATMs at the airport and other major tourist destinations, as they are likely to have higher fees.) If possible, use a debit card that does not charge foreign transaction fees, which can save you approx. 3% for you with each withdrawal.

You can also rely on a credit card to spend while traveling. This reduces the need to carry cash, and credit cards have strong fraud protection. However, there may be situations when you cannot use a card, such as paying for a taxi or tipping a guide. That is why it is highly recommended that you always carry some cash.

Another alternative that is becoming more and more common is mobile payment apps. This includes digital wallets like Apple Pay, Google Pay, as well as peer-to-peer payment apps like Venmo, PayPal, and Cash App. Other countries may have different apps, such as WeChat Pay and Paytm. Generally, these apps are safe, secure and convenient. However, they may not be accepted everywhere, and may require an internet connection to use. That can cause a snag if you haven't bought a local SIM card or data plan.

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