Anytime you plan a vacation outside of your native country, it’s essential to research and understand the currency exchange. This can be a somewhat complicated task, but crucial nonetheless. As you plan a getaway, knowing how your currency converts to the foreign currency will help you determine how much money you have for activities, food, and other vacation items. 

 

If your home currency is highly valued, you may be thrilled to see the budget you set aside for your trip will stretch further than initially planned if you stayed local. However, if your currency value is weak in the exchange market, you may want to save more before your trip so that you have enough funds to purchase meals, taxis, souvenirs, etc. 

 

If you’re planning your trip at least a few months in advance, you should be able to get a good understanding of how your currency will exchange. Because foreign exchange rates are not a standard, guaranteed rate, some travelers watch the markets closely to see when their home currency will produce the highest conversion rate. Rather than waiting until they arrive in their destination country, they can exchange the money locally before their trip. Other travelers prefer to wait until they arrive at their destination to make the currency exchange. Either way, you should make all exchanges at a financial institution so you can guarantee you are getting the proper exchange rate for your money. Once you return from your trip, your bank will be able to make the reverse exchange as well. Many people opt to use exchange kiosks at the airports and train stations, but those often charge a fee or percentage. If you plan to exchange your money at one of these kiosks, make sure you account for the additional costs.

 

Because currencies fluctuate with the global market and based on events around the world, it is recommended that you do some research before planning your trip, if possible. Suppose you are traveling for work where the majority of your expenses will be paid. In that case, you should still take the time to check out websites like x-rates.com so you can determine whether your daily per diem for food will cover your actual expenses or if you should plan to bring extra funds in case of a shortfall. 

 

So, before you plan a vacation, destination wedding, honeymoon, or work trip, take some time to research and understand the currency exchange. A good rule of thumb is the exchange rates can and will vary by +/- 1% on any given day, so plan accordingly. Take the time to budget, research, and plan ahead so you can spend your time making memories instead of worrying about money. Happy traveling!