i am excited about my upcoming honeymoon to paris, but i am confused by one thing. i ahve purchased and browsed a couple of different guide books, but i still can't figure out how to do this changing currency thing. what i am really confused about are exchange rates. granted, i was not an economics of finance major in college, but it seems to me that if $1 USD is worth xxFF, then $2 USD would be worth xxxx FF. but my guidebooks are telling me "exchange here for a good rate, don't exchange here b/c rates are lousy, exchange here to get the most for your $$, etc." so, what is up with exchanging money? specifically in paris, and how do we go abot doing this? this question comes from someone who has only trip outside the us was to the bahamas. thanks so much in advance for you help!!!!

The exchange rate you find in the newspaper is not the rate you will get if you exchange your $$ for francs at one of those ubiquitous currency exchange places, AMEX, etc. These places make their money by giving you a worse rate. In other words, say the exchange rate in the newspaper (the "wholesale" rate) is 7 FF per $1. You won't get the wholesale rate at currency exchange office - you will get a worse rate. <BR> <BR>I will be going to Paris next week and plan to use my ATM card because in doing to I will get the wholesale rate. Also, using credit card for your purchases has the same effect. I do not recommend using your credit card for cash advances because most credit card companies charge huge fees for doing that. <BR> <BR>I have been overseas many times and no longer use traveller's checks. You can use your ATM and credit cards almost everywhere now. Whether you buy your traveller's checks in francs in the U.S. or buy them in dollars and exchange them for francs there, you will get screwed on the exchange rate. <BR> <BR>A final note: make sure your PIN for your ATM is four digits long - ATM's in Europe only accept four-digit PIN's. <BR> <BR>Hope this helps.

Good advice from Linda but, here is a caveat. Some Credit Card companies charge a small fee when converting back to USD. For instance, my Shell Master Card, which gives me discounts on gasoline purchases, tacked on a surcharge for my purchases made on the card while in Europe. Big surprise when I got the statement. Don't do that anymore. Check with your Credit Card company first.

I second Linda's approach. I've found ATMs to be the way to go in terms of getting cash overseas, at least everywhere I've been in western Europe. Teller machines are not hard to find, and usually quite easy to use; I've used them in Venice, Paris, Geneva, the Haute-Savoie Valley, Munich, Amsterdam and small Dutch towns, the Rhine Valley, Athens, Santorini, Mykonos, Paros, London and western England, and all over Ireland and Scotland. Never had any problems. The exchange rate you get is definitely better than you'll receive at Thomas Cook et al.--as Linda said, that's how they make their profits; and better than the one you'll get when you buy traveler's checks as well. <BR> <BR>My usual approach to money when traveling in Europe is to withdraw my limit in cash at the airport on arrival day (to limit ATM fees, if any) and use that for small daily spending until I run out, at which point I take out more cash. Larger purchases, like hotels, restaurant dinners, and major shopping go on credit cards, where one can also be sure of a good exchange rate, can challenge a charge if there's a problem, and can often get bonuses like airline miles if you have that kind of card.

When in Italy, I always try to change currency at a bank rather than the available exchange offices in towns or at airports. You get the best rates. If you must exchange money on the streets, I would avoid American Express offices, which offer less lire for your dollar.

I have been to Paris 4 times (and hoping for a 5th shortly), the best rates I have found in Paris is at the Paris Vision bus tour offices. Better than any bank, change booth, or ATM card. No commission. I'm guessing their outlook is get you into the office to change your money and maybe you'll purchase a tour. Never any pressure to purchase a tour.

Mandy, <BR> <BR>No lecture here or anything - - not even entirely your fault that you went to college (presumably graduated high school) and the basics of how monetary systems work are not part of a basic education here in America. <BR> <BR>You probably understand this in your own subconscious more than you realize it. You know that a dollar is roughly worth two to three quarts of gasoline. And you understand that it can be worth more gasoline on one street corner than on another. And a different amount in one city versus another - - and next week versus this week. <BR> <BR>And currency is no different than gasoline. It is worth what someone is willing to pay for it. It represents faith in the economic system of that country. Some days the faith runs higher, some days lower. Some countries have higher faith in their near neighbors, some have less in their neighbors where manufacturing or mining or farming or whatever - - is not going so good at the moment. <BR> <BR>The place that exchanges your money for you is selling you a service - - (s)he is offering to buy a little faith in your country's monetary system; you are showing your willingness to buy into the faith of that country's economy. <BR> <BR>Just like with how many quarts of gasoline you can buy for a dollar, some places sell you more, some places sell you less - - and the reason(s) might have nothing to do with you or what you perceive you are getting for your dollar.

As Rex pointed out, currency is a commodity, like gasoline or blueberries. There are producers, middlemen, brokers, and, eventually, consumers. The larger the quantity, the cheaper per unit you can buy it (why the interbank rate is cheaper than at the exchange bureau). In addition, there's overhead; the cost of counting, bundling, and securing, legal tender (Travelers' checks, currency, coins) is much higher than electronic operations at an ATM (it's just bookkeeping there), hence, the better rate through an ATM.<BR><BR>Finally, the "worth" of the commodity is changed by daily news - it's all very convoluted - what appears to be bad for a nation's economy can be good for its currency, making it more expensive to buy with the $US. Now, this isn't particularly good for international trade, because the US would be discouraged from buying from that country, blah, blah, blah...all of this makes my brain hurt.<BR><BR>Two simple rules: it's more expensive to deal with humans and tangibles than it is computers and electronic numbers; anytime the $US is strong against another currency, it's good for US travelers to that country.

i appreciate everyone's advice, and of course it makes perfect sense! thanks for not making me feel like an idiot. i have found that i never quite know what kind of attitude to expect on this board. thanks again!

Hi, Mandy, I agree with Gina - we spent 18 days in Italy in October and used the ATM for cash and credit card to pay when possible and got really good rates and I think it was all of $1.50 USD per ATM transaction. <BR> <BR>Rex - great explanation of exchange rates - how about an economics course on the Forum? You said it very well.

I don't want to get into the economics of the situation because it is complicated. But, to augment Rex, the exchange rate is a function of the demand level for a given nation's currency. Back last summer, the US dollar was in demand because of our lucrative financial markets. (The Big Bull was still romping.) When the stock market started slipping recently, so did the exchange rates of the dollar vis a vis the Euro as well as non EU currencies. People were selling stocks and taking the money out of the US and there was concurrent strenthening of several national economies. Demand for $$ fell; and so did the price for Europeans. (Simple economics; if there are more sellers than buyers, the price gets cut. Take for example the Russian ruble. For years US green was a surrogate currency because Russians did not want their own money!! On the street exchange rates were quite good.) <BR> <BR>From the discussions above, there are several very critical points that need to be underscored so that the individual does not end up taking a beating. <BR>1. Some companies do use exchange rates as an advertising gimmick. (Once in Canada I saw several merchants who were advertising exchange rates much better than those available at the local bank. It was a form of a mark down. I asked why the store did not simply discount the prices. Well, it seems like the members of the merchants association had agreed not to discount prices until x date and some of the stores had found a loophole.)Take advantage of those deals. <BR>2. Watch the amount of "metal" accumulating in your purses and pockets. <BR>We are not used to large denomination coins. Sometimes we tend to treat 10 franc coins like dimes rather than dollars. If you change countries and have a pocket full of metal, banks will not exchange it. So you either carry the coins home or give them away. <BR>3. ATM's are usually the place to get spot cash at the best rate, but exceptions do exist. And you should know in advance what your bank back home charges. For example, I get two "foreign" ATM uses per month at no cost. <BR>After that, I pay $1.50 per transaction, regardless of the amount. <BR>4. Changing small amounts of currency after crossing from one country to another usually gets the worst possible rate. If you are riding on the train, you might as well spend the residual on food!! Perhaps you can unload some of the coins you have pocketed. <BR>(I got caught with 150 ff last summer because it was rolled up in a pocket. I found it just as we got to the border and the bar car closed. And I am still fuming about it - slightly. So I changed it in Lausanne because I anticipated it would be over a year before I got back to France. ) <BR> <BR>Hopefully the introduction of the Euro as a common medium of exchange will reduce the need to be constantly spending and/or exchanging small amounts of money.

My favorite experience with travelers' checks: My last day in Europe I was in Geneva (isn't that the "banking capitol of the world"?) and realized that when I returned to the US the next day I would have no US dollars. However I had an uncashed $100 US American Express travelers' check. I went to the American Express office, thinking I could cash their check and get $100 in cash. WRONG!!! They would only change my US travelers' check into Swiss francs at their current rate, then again exchange those for US dollars at their current rate. They informed me I would get approximately $67 for my $100 check. That was seven years ago and the last time I took a travelers' check to Europe. I use only my ATM (withdrawing funds from my checking account, not "borrowing" on a credit card) and credit cards for all purchases over about $20. Haven't had a problem yet in many months of European travel.

All good advice, However, It needs to be clarified that you should use a debit card to get the best rates, net! If you use your credit card for your cash most banks will charge you a transaction fee & intrest on that money until you pay them back.I carry a credit card for most all purchases ( 1$ = 1 mile) & my debit card for local cash. It works in all major & 3rd world countries. Not sure about the 2nd world countries. Don't worry about the exchange rates the ATM gives you (it is the best at that momemt) except to give you a comparison for what you want to purchase. ie: 1$ = 7FF, A Coca Cola is 20FF or about $3US.

As for credit cards, an interesting new development has arisen. Formerly Visa/MasterCard charged an unseen 1% for foreign conversion. That worked so well for them that most credit cards tack on an extra 2% (still unseen) over that. The only card I know for sure that doesn't do that is MBNA (there are a few others). <BR> <BR>What is really funny is to write your credit card people a letter asking them if they add an extra percentage, how much and why. I've never seen such gobbledy-gook in my life!

You have to pay comission to change money, thats why the rate varies - some overcharge. <BR> The commonest ripoffs are bureaux which have signs saying "no commission on buying foreign currency".It may be foreign to you but its local to them & they'll charge 9.9%!! <BR> Both rates & commission are posted. <BR> Use ATMs & Thomas Cook. <BR>In UK post offices give the best rate.

A few tips. <BR>1. Be absolutely sure what is the NET rate before handing over any currency especially to non-banks (i.e the ubiquitous exchange offices). The headline rate may appear attractive but often commissions may amount to 9/10% ! Look around if you have time. <BR>2. Use bank exchange machines if available but check the flat commission amount first. If you are a small group try to do one operation all together thus splitting the flat commission. Note that many machines do not accept dollars. <BR>3. Check out the post offices in the major tourist locations - often they give good rates with low commission. <BR>4. If you are crossing the border you will find that many shops, gas stations, supermarkets etc will accept the neighbouring country's currency. You can unload small amounts this way by buying something you may need immediately or later. If you have larger amounts you may find that large hypermarkets or commercial centers (near borders) will change foreign currency at a good exchange rate because they think you are going to spend it there. <BR>Ian