Purchasing Euro's now or later

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Apr 26th, 2011, 08:51 AM
  #1
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Purchasing Euro's now or later

With the exchange rate not looking like it is going to get better anytime soon should I consider purchasing some Euro's now or wait it out? We are traveling mid June

We want to purchase 500 Euros from our local bank which has the best rate right now compare to other places. We like to have some money with us when arriving in Europe

Thanks for any insight
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Apr 26th, 2011, 08:55 AM
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Your bank will not give you the best exchange rate; wait until you are in France and get Euros from any ATM.
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Apr 26th, 2011, 08:58 AM
  #3
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Actually compared to everyone else in the area they have the best rate and no fees. I don't like arriving in a country with at least some local currency and do not want to exchange it at the airport as that offers the worst exchange rate.

Our bank also offers ATM withdrawls without ATM fees at specific European branches but our first stop is Malta where they don't have an affiliated bank and to avoid ATM fees would like to bring some Euros with us. Then once we get into Italy we can use ATM's there without ATM fees
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Apr 26th, 2011, 09:02 AM
  #4
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Also my question really is about if those that travel way more than I would consider purchasing some euros now or wait. Worried about the exchange rate going higher than it already is (not in a good way)
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Apr 26th, 2011, 09:05 AM
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Since the € will be at $1.50 rather sooner than later, what are you waiting for? Just don't expect any cab driver or gas station to accept a 500€ bill.
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Apr 26th, 2011, 09:05 AM
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Since you seem to know how much that will cost you, comparing their rates to the interbank, why ask us? What do you want us to tell you that you don't already know?

The best rate "in the area" may not be saying much, it doesn't mean anything wehre I live as virtually every bank around I am familiar with, as well as AAA and Travelex, charge a 7 pct markup.

I don't think buying euros in the US to avoid an ATM fee could be cost effective, as even if you have a bad bank (which I suspect), I've never heard of one charging more than $5. So if you took out 200 euro, for example, that would cost you $290 today and $5 is only 1.7 pct of that.

If your bank's markup on their rate is only 1 pct, good, but I doubt it.


Since the exchange rate right now is particularly bad, it seems a bad time to do that to me.
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Apr 26th, 2011, 09:10 AM
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First of all its Euros - no apostrophe. the Euros don't own anything.

Second, do not change any $ at all. Doing it here in the US is shoveling money out a window - you will lose about 10% of the value. Instead use credit cards for larger expenses and pull euros from an ATM with a debit card linked to your checking account. This will cost more like 3% - thus saving about 7% of your money. (if you spend only $2000 total you will save $140 - enough for a very nice little dinner.)

If you must have a few euros change $100 in your departure airport - the rate will be awful but now worse than anyplace else in the US.
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Apr 26th, 2011, 09:11 AM
  #8
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Wow - didn't think I would get beaten up but asking a simple question. Maybe I wasn't clear.

I was trying to get advice from people that travel more than I if they would go ahead and purchase some euros now or wait for the simple reason that I figured people have more knowledge then I do about exchange rates since we don't travel to Europe often. We have been but last time was in 2007 and the time before that was 2001

If I wait to get it when I arrive in Europe the exchange may be worse and purchasing some now may end up saving me money? I am not sure and trying to ask those that may want to give me their input
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Apr 26th, 2011, 09:19 AM
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Christina why would you even answer that way, having a bad day? I don't have a bad bank so why would you even assume that? We are actually quite happy with the bank we do business with

As of today the exchange rate on xe.com is $1.46
Our bank exchange rate is 1.49 with no other fees tacked on
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Apr 26th, 2011, 09:20 AM
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If you can do online banking, just buy some € denominated debt of a country/company you trust for the amount of money that you'd want to spend in Europe. It might cost you a $15 fee to do so. Sell it before you leave.

Then your rate will be fixed no matter when you leave.
Get cash from an ATM.

If you need 500€ in cash, just go to your bank and get them, no need to even think about it for a few $ spent more or less.
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Apr 26th, 2011, 09:23 AM
  #11
 
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If you would feel more comfortable with SOME Euro for your arrival in Europe then by all means ease your mind and purchase some at your local bank.

But I would caution you about two things. One is not to carry so much money with you. Use your credit card for hotels, meals and save the Euro for small purchases.
Secondly. I realize that your bank is saying that it has no fees. And that probably is correct. But if the rate of exchange they will give you is better then that which you will get in an ATM, even considering ATM fees, I would be very surprised.

There are credit cards which give very good exchange rates with no foreign transaction fees for example Capital One, among some others.

If fees concern you, consider applying for one of these cards.

I travel to Europe on average twice a year. This isn't a lot by some standards but I usually only take some Euro that is left over from the previous trip. This last time it was about $50 worth.

In the end you should do whatever you feel comfortable with. But I think you will get the opinion here not to take large amounts of cash with you and not to buy it in the States. Good Luck.
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Apr 26th, 2011, 09:31 AM
  #12
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Logos and Sher - thank you for your responses

Personally I only wanted to take 200 euros with me to have some to start off with but my husband is the one that wants to take more.

We shall discuss it more this evening and make a decision
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Apr 26th, 2011, 09:45 AM
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"I figured people have more knowledge then I do about exchange rates since we don't travel to Europe often."

Nobody knows which way exchange rates are headed, any more than they can predict the ups and downs of the stock market.

Either way, buy now or buy later, it's always a gamble. So nobody can really answer your Q -- it's not like people who travel to Europe often have a secret crystal ball that tells them ahead of time which way exchange rates are going.
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Apr 26th, 2011, 09:48 AM
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We are heading to Europe in June. My plans are to get about $200 of Euros before I leave to have cash for a layover in Germany and to pay for ride from airport to apartment we have rented. Upon arrival find an ATM and use debit card to get Euro's to pay off balance of apartment (owner's request for cash). I'll plan to pay all other big expenses (tours, hotels, meals, etc) with a regular credit card. Probably withdraw about $100 euros a day for small incedentals (taxi, bus fare, snacks, etc). Basically get cash as needed so as not to be holding a lot on me at any one time. Really no different then how I handle my money here at home in the states.
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Apr 26th, 2011, 09:59 AM
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None of us is mindreaders - and the $/euro rste of exchange can go in any direction at any time.

If you only feel safe bying them in advance then do it - just realize what it is costing you.
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Apr 26th, 2011, 09:59 AM
  #16
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I don't have prior knowledge of the direction exchange rates will take, but I do know that buying euros in the US will cost me about 7%.

As a frequent traveler to Europe I would not buy any euro now or ever - I just use my ATM card upon arrival and save on the 7% markup.

If you are going to buy 500 euro regardless then by all means buy some now. If the exchange rate changes in your favor you'll be ahead. If the exchange rate gets worse for you, you'll lose money. It's a crap shoot that shouldn't make or break your trip one way or another.
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Apr 26th, 2011, 10:01 AM
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Looking at the dollar chart of the last 10, 20 or 30 years, it's really not difficult to see where exchange rates are headed. Those that claim otherwise, have never taken a look at those charts. If you still hold $, it may be time to think about a better investment. It's not rocket science but you have to take the time to inform yourself. Losing 50% is always better than losing everything. People still have the illusion that what goes down must come up again but that is not always so.
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Apr 26th, 2011, 10:04 AM
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To each his or her own...personally, I wait till I arrive and use the ATM's, depending on the country I may not need all that much as my philosophy is to use my credit card (Capital One) to charge anywhere there is a visa/mc decal (although I understand some countries are different than others; in some countries the modern 21st century way of doing business with plastic has still not hit butg in others, you can go for two weeks and not once have to spend cash for anything!) but be that as it may, let me ask you a question....

I have a very large, fire proof, storage tank in my basement...would it pay to stock up on gasoline now when it's "only" $4/gallon since it may go to %5/gallon by the summer when I will really need it? The same answer goes for euro; nobody knows. Logos certainly doesn't know as last year on these boards, she predicted the euro would surpass the $2 mark along with it the collapse of the US dollar and economy. It hasn't happened so now she acts like she knows it'll hit $1.50....what if Portugal goes bust and the euro falls to par....nobody knows. So to me, you might as well wait and que sera sera, what will be will be.
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Apr 26th, 2011, 10:10 AM
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I concur with the above sentiments. I would not buy any quantity of euros now, since the cost tends to be in the 5-7% range. I might buy a little bit (500 seems like too large a number), enough to get a cab to the hotel.

So basically are you willing to gamble/spend 5% now, that the exchange rate will worsen by more than 5%. If worse, you are ahead. If same, you lose. If better, you lose.

In the scheme of things, calculate for your trip, what a swing in exchange rates will mean to your daily budget. On an infrequent traveler to Europe, you may say that..$25 a day, for example...will not ruin your trip (I hope!)
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Apr 26th, 2011, 10:11 AM
  #20
 
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As long as my money earns more per day than I do, I must have done something right. If there just weren't this evil taxman. ;-) The game is very predictable. The $ will surpass the 2€ mark as certainly as the sun rises every morning.
Why? Because those that make the rules of the game do want it.
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