Converting Currency

[emdav]

I'm going to Canada this week for my brother's wedding. I'm not sure the best, cheapest way to convert my US dollars to Canadian dollars. Should I go to a bank before I go? Should I go to an ATM there? We are arriving late at night and have to pay a babysitter the next morning. It is a very small town in Alberta and I don't what kind of services are there.

Also, do credit cards charge a fee to convert currency each time you use the card? Is it better to pay cash to avoid fees? I appreciate any advice because I have no idea what to do. Thanks!

 

[msmayor]

You really don't need to worry about converting the money; most every single merchant will accept US $$...change, however, will be given in CDN currency. That you can exchange at a bank or change booth before you leave.

Be prepared for a boatload of change; my husband said his pockets never felt heavier. The smallest paper bill in Canada is a $5; their dollar coins are "loonies" and a $2 coin is a "two-nie". Pay attention if you get a lot of coins when using them for tips; as I recall, the loonies and two-nies are nearly the same size and look somewhat similar.

 

[vegasnative]

You need to check with your credit card directly as to what (if any) type of fee they charge to make the conversion. I think most do charge something though. We just purchased some cleaning supplies for our business from Canada, and our card was charged 3%. Also, I don't know if you can go into a bank here and get Canadian currency? Maybe if you live close to the border now, those banks may carry it, but usually you cannot. I know you can turn the Canadian in when you get home, but I would think you would have to buy it when you get to Canada. Could be wrong though.

 

[JB2K]

It's also noteworthy to mention that if the OP is a Bank of America customer, he/she can use any ScotiaBank ATM in Canada (and the banks will waive all fees, including the 3% international transaction fee).

The same works in reverese for our Canadian friends who may pass-by a BofA ATM in Florida or California.

There are several other countries involved, too -- for more information, type "Global ATM Alliance" in your favorite search engine...

 

[rewok]

OK, first, if you are really going into a small town not close to the border, Canadian currency is definitely a must. In such a place, not all businesses will take US money, and those that will won't give a very good exchange rate. In that case, using your credit card will yield a better exchange rate. Mastercard/Visa OK pretty much everywhere, but some small places might run cash only.

As for credit cards rate, most cards charge around 3% extra on top of the "market" rate. However, there is no way for a consumer to get that elusive "market" rate. Everyone charges a premium over that, at my bank it's about 2%, so I mainly use the credit card on my US trips. Same for the ATM, however you'll probably have to pay some sort of fixed fee for the withdrawal. But if you need to get money only once, it might be a good-easy idea.

Finally, you should be able to get money at a local bank or currency exchange before leaving if you live in a somewhat reasonable size city. Try to estimate how much you'll need, and pay big tickets items like lodging on the credit card.

Hope this helps!

 

[emdav]

Thanks everyone for the good advice. My neighbor advised me which local bank has Canadian currency and we'll get a bit before we go.

 

[xmlguy]

First you ask advice about the cheapest way to convert, then you completely ignore that advice and choose one of the more expensive options.

The reason why banks carry foreign currency is to sell them at a bad rate to newbies like you. It's also why pickpockets stay in business by targeting foreign travelers who usually get more currency than they really need.

If you listened to the advice, you would use credit cards for nearly all of your purchases, and only pick up a small amount of local currency after you arrive from an ATM machine that is affiliated with your bank.

 

[pjlla]

Not sure where you live, but since we live only a few hours from the border, we were able to change a small amount of $$ (about $300) at our local bank. I did ask ahead of time and they told me how much they usually keep on hand and it was well within what I figured I would need, so I didn't need to "order" any $$ (but you can order foreign currency at most banks... for a price). I got my Canadian currency and spent almost all of it while on my trip (the last day was touch and go, but we planned well). My local bank didn't charge me anything, since they had the $$ on hand. When we went the exchange rate was fairly flat, so it wasn't too difficult for me to know whether or not I was paying a decent price for things. And yes, they do use a LOT of coins. Have a good trip...................P

 

[emdav]

First you ask advice about the cheapest way to convert, then you completely ignore that advice and choose one of the more expensive options.

The reason why banks carry foreign currency is to sell them at a bad rate to newbies like you. It's also why pickpockets stay in business by targeting foreign travelers who usually get more currency than they really need.

If you listened to the advice, you would use credit cards for nearly all of your purchases, and only pick up a small amount of local currency after you arrive from an ATM machine that is affiliated with your bank.

Actually, I said I was going to get a "bit" of money before we leave. And, I have my reasons. I am going to a very small town, arriving late at night, and having to pay a babysitter in the morning. I need cash to do that. I'm on a tight schedule and don't want to worry about finding an ATM. I need a "bit" of money.

I do plan on calling my credit card companies today and finding out which card will be best to use on the trip. I will be using credit for most purchases.

 

[xmlguy]

It's fine if you want to choose a more convenient option, but you will not get the best, cheapest way to exchange the currency, which is what you asked for. It's like asking for the best cheapest price for a can of coke, but just buying it at a convenience store at the highest price. It sounds like it's not going to be worth getting the best rate, since the amount is so low, so I understand your point. The cost of getting currency usually increases the farther away from where "it lives". The locals need to get currency too, and nobody wants to wait for banking hours to get it, so ATMs (aka cashpoints) will be surely available nearby somewhere along your trip, unless they only trade furs and seal skins in the village.

 

[msmayor]

Actually, I said I was going to get a "bit" of money before we leave. And, I have my reasons. I am going to a very small town, arriving late at night, and having to pay a babysitter in the morning. I need cash to do that. I'm on a tight schedule and don't want to worry about finding an ATM. I need a "bit" of money.

I do plan on calling my credit card companies today and finding out which card will be best to use on the trip. I will be using credit for most purchases.

I suggest you double-check with your bank before you go to see if your ATM card can be used in another country.

I asked at my bank three days before we left for Toronto and was told that my card was ONLY valid in the US because of fraud concerns.

I could obtain cash through my credit card, but that required setting up a PIN. Fortunately, I was able to get it done before we left.

Had I counted on being able to get cash via an ATM I'd have been in trouble.

 

[emdav]

I suggest you double-check with your bank before you go to see if your ATM card can be used in another country.

I asked at my bank three days before we left for Toronto and was told that my card was ONLY valid in the US because of fraud concerns.

I could obtain cash through my credit card, but that required setting up a PIN. Fortunately, I was able to get it done before we left.

Had I counted on being able to get cash via an ATM I'd have been in trouble.

My ATM card is also a debit Visa. I called and there is only a 1% fee with this card which sure beats the 3% of my other cards. I think I found my best option and appreciate everyone's input.

 

[xmlguy]

When you get currency using a credit card, you usually pay cash advance fees in addition to currency exchange. When you make a point-of-sale purchases, there are no cash advance fees for credit cards. That's why using credit cards for purchases whenever possible and using ATM/debit cards to get currency are the best ways to travel. When you use a credit card for purchases, you also usually get more consumer protection. So long as you pay off the credit card bill without keeping a balance, it remains a good option for purchase protection.

For emergency cash, you can also see if your bank lets you buy travelers checks without a fee. If you don't use the Tchecks, you can deposit them back into your account without cost when you return home. This can be useful when your Bank cuts off electronic transactions at an inconvenient time to do maintenance. You can even get some foreign denominated traveler's checks if ordered in advance, but those involve some significant fees, yet are much safer if lost or stolen vs. cash. I would only use these if you have a large purchase that can't be done with a credit card.

 

[Cruise]

I do plan on calling my credit card companies today and finding out which card will be best to use on the trip. I will be using credit for most purchases.

You'll end up paying a 1% fee of each purchase no matter what - this is what Visa and Mastercard actually charge. You can end up paying another 1%-2% of the purchase to the actual card issuer depending on what they choose just "because they can." You'll find that most major, well-known cards end up at the maximum 3% fee. Some of them sometimes waive these fees and I read about one that, once upon a time, refunded the mandatory 1% Visa fee, but I doubt that's the case anymore with credit being what it is these days.

Your best bet for getting away with only the 1% and no additional fee is to use a credit card associated with your local credit union or something similar. I have a credit union credit card that is used pretty much exclusively for overseas purchases. It is the 1% fee. I'll only use the credit card for major purchases (hotel, etc.) though and mostly stick with cash.

Again, with a credit union ATM card, you usually end up with the best exchange rate. I will frequently show up in a foreign country with none of the local currency in my pocket. It's always easy to find an ATM at the airport and get the cash. The *most* I've ever been charged for doing this was 79 cents for the ATM fee. The cash itself was at mid-market rate for that day - something you'll never get at a bank. I just never find that I need local currency before I get out of the airport.