Q: Where would I get the best exchange rate for the euro? Should I just bring a debit card or a pre-paid travel card?
A: Excellent question, because currency exchange can be a hidden cost to traveling outside the U.S.
As a rule of thumb, you can expect to pay for convenience -- and perhaps pay dearly. So, the most convenient exchange locations, such as those in airports, would generally offer the worst exchange rates.
Unfortunately, the same might be true of credit, debit, or pre-paid cards. These often have implicit exchange fees when used outside the U.S. In other words, when translating a charge that you made in euros back to dollars for the purpose of billing you or debiting your account, the bank might tack on an additional percentage of the charge as an exchange fee. Check into your credit or debit card company's exchange fee policies, and if you have enough time before your trip, shop around to see if you can find a card with a more generous policy.
You'll need to find a reasonable credit card to use, but of course, you'll want to have some cash on hand as well. Think about exchanging cash at a bank before you leave, because this allows you to take some time to do it right. Several popular finance web sites post current exchange rates, which will give you a benchmark to use when talking to banks.
Next, don't limit yourself to your current bank -- just because they offer the highest CD rates or other bank rates doesn't mean they have the best exchange rates. Use the telephone and the Internet to shop around -- and do the same with any excess currency when you return.
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