Soopermartin

Hello. Going to Europe soon and want to ask about ATMs vs bringing bills.

Background: I often travel to Thailand and I take US$100 bills to exchange into baht. The exchange fee is only 1%. So I lose 1% and get Thai cash. Using ATM, there are inconvenient daily limits, and also the potential problem of my bank shutting down my ATM card. Wells Fargo told me to my face once before I left USA that I could use my card in Thailand, but after I got there I could not use it. Bank of America is better, if I tell them in advance, I can use my ATM there. The fee to use an ATM in Thailand is about $5 per transaction, AND (very important) the bank takes about 3% fee. Last trip, I bought gold bullion (for spot price plus 1%) in USA and took it with me, just a few coins. In Thailand I sold these at 100% spot price, for local cash. Cut the bank out entirely, and I only lost 1%.

I think a lot of people are hooked on using ATMs overseas when they don't fully realize the fees.

I am going to Europe soon and I am reluctant to use ATMs. I spoke to my bank today and they said their transaction fee is about 3%, and $5 per transaction fee if I use non-partner banks.

I wonder if someone can tell me what the rate is to sell US$ for British Pounds, once I arrive in Britain. Will I lose more than 1%? Are you sure? Is there a website that indicates online what a given bank in Britain will pay me for my US$?

Also, I will travel to the continent from Britain. I wonder if a bank in Britain will sell me Euros for dollars, at a fair rate.

Thanks for any feedback.

kybourbon

>>>I am going to Europe soon and I am reluctant to use ATMs. I spoke to my bank today and they said their transaction fee is about 3%, and $5 per transaction fee if I use non-partner banks.<<<

My bank doesn't charge those fees. Sounds like you need a different bank.

You will lose much more money in Europe exchanging $'s. You would have to use exchange places as most banks don't want to fool with tourists exchanging money. I had to exchange some cash at a bank in Italy last year as my ATM card wasn't working. People exchanging money were waited on last after all other customers were served. I was in line for change two hours. Exchange places give a lousy exchange rate plus charge a hefty fee.

janisj

"<i>I wonder if someone can tell me what the rate is to sell US$ for British Pounds, once I arrive in Britain. Will I lose more than 1%?</i>"

More like 7%-9% and sometimes more

"<i>Are you sure?</i>"

Absolutely

"<i>I wonder if a bank in Britain will sell me Euros for dollars, at a fair rate.</i>"

No

What may or may not make sense in SE Asia does not apply to Europe.

Use your ATM card --and if there are partner banks -more the better . . .

Soopermartin

Thanks for the responses. I use Bank of America and I am not 100% positive but I do believe, with some certainty, that regardless of what bank you use, if you were to record what the exchange rate on a given day is, and you use your ATM on that day in Europe, your US-based bank will give you an exchange rate that reflects something like 3% commission for themselves.

On the subject of banking, I also want to open a bank account in Europe. If anyone here can has some experience with that, I would greatly appreciate any advice.

Regarding selling dollars in Britain for pounds, based on what was mentioned above, here is the international rate now:

STG : EUR 1.129
STG : USD 1.635
EUR : USD 1.448

Therefore, if I go to Barclays Bank branch with dollars in hand, I will need $1.63 x 1.07 = $1.74 in order to purchase 1 pound sterling?

Peter_S_Aus

Forget it. Use an ATM card.

Or take gold Krugers.

janisj

Use your ATM card . . . end of discussion.

(BTW -- you most likely won't be able to open a bank account)

Soopermartin

<i>"Forget it. Use an ATM card. Or take gold Krugers."</i>

I discovered a bullion shop in London that pays spot for gold so it's easily possible to use your US$ and buy a few krugerrands at a local coin shop in USA then sell them in London for identical exchange (zero loss). Sometimes krugerrands are 1% over spot though when you buy. I like to avoid bank fees if at all possible. Thanks for the advice re: ATMs are the only way to go. I wonder if there is a contrarian opinion to that but I do respect all people responding. Thank you.

PatrickLondon

However and whatever you buy and sell (whether cash currency or gold), someone will seek to take their cut. A system that depends on a physical transaction (you taking whatever it is into a building with a person to check it, count it, work out what to do with it, count out cash to give you, and so on) is by definition more expensive to operate than one that works on electronics, and will charge you more. They will dress it up in all sorts of ways ("No commission!" = lousy exchange rate, "Best rates!" = high commission charge), but they will almost certainly take more off you than any ATM-based exchange.

Peter_S_Aus

Travellers cheques are another possibility. I personally don't use them, but a few people really like them.


For some obscure reason ....

Or maybe a Letter of Credit?

kybourbon

>>>>I use Bank of America and I am not 100% positive but I do believe, with some certainty, that regardless of what bank you use, if you were to record what the exchange rate on a given day is, and you use your ATM on that day in Europe, your US-based bank will give you an exchange rate that reflects something like 3% commission for themselves.<<<

That would be wrong. My bank does not (I use a credit union). I get the exact interbank rate you see in the paper or on oanda.com or xe.com. Other banks refund the ATM fees. It depends on your bank and you seem to have chosen one with the highest rates. You can check your receipts when you get back against the currency websites (use the history rate finder and enter the date of the transaction, it will give you what the rate was that day).
http://www.oanda.com/currency/historical-rates/

exchange rates
USD GBP EUR JPY
USD 1.0000 1.6340 1.4475 0.01239
GBP 0.6120 1.0000 0.8859 0.00759
EUR 0.6908 1.1288 1.0000 0.00856
JPY 80.683 131.825 116.793 1.0000

Soopermartin

Hi Kyle. I would not be surprised if Bank of America offers rates higher than others on ATM. I have tried to pay attention to these matters but my travel is usually to Asia, and I carry cash. ATMs are a backup source. I have family there and don't mind exchanging several thousand $$ because I can keep it safe at home. I usually read the daily rate to keep the money exchange honest, and from what I recall, I always lose just 1% which isn't really bad.

I do have a hard time believing that you can get the exact interbank rate, but my faith in banks is not high (I am a skeptic). If there are banks which offer this exact rate, and refund ATM fees, it is good news. So thanks for that bit of optimism. The falling US$ is bad enough, if you have any US$ then you know that sad story. Thanks for your comment.

Peter_S_Aus

I'd short the USD, and take a long position on the AUD, maybe not so long on the euro.

Soopermartin

<i>"I'd short the USD, and take a long position on the AUD, maybe not so long on the euro."</i>

No joke. I was in Australia last year and got AUD$109 for US$100. I found prices to be high. Since my trip the US$ has fallen about 15%. It must be a joke for Aussies to come visit USA now, it is truly a sign of becoming a Third World country when foreign tourists come and laugh at how cheap everything is.

alanRow

"I use Bank of America"

who are partnered with Barclays in the UK and hence you won't pay the $5 transaction fee if you withdraw money from one of their ATMs

In France the partner bank is BNP Paribas, in Germany it's Deutsche Bank

J62

I also use Bank of America and I am 100% positive, with certainty, that when I use a BofA partner bank, when I record what the exchange rate on a given day, and I use my ATM on that day in Europe, my BofA will give you an exchange rate that is exactly the interbank exchange rate.

I've checked on the internet at the exact minute I've made the ATM withdrawal.

Nikki

The Charles Schwab check card offers ATM use with no foreign transaction fee and no 1% VISA charge and even refunds any fee imposed by an ATM in the US (the ATMs abroad do not impose a fee for the use of foreign cards, all fees are imposed by your own bank).

Motorino

Sounds good Nikki. I am going to look into Schwab card. I will also look into Bank of America, which I actually have, but must be doing something wrong or do not have enough money to get the deal others are getting from Bank of America. Currently Bank of America is charging me 3% on all purchases and withdrawals + $5 on ATM withdrawals that are not owned by Bank of America. My university ATM card account does not charge the ATM withdrawal fee and refunds foreign bank fees but does charge the 3% foreign exchange fee... There is hope!

Commodore

We will be in Europe this summer. I just changed my BoA pin at the ATM machine from a long one, to a 4-digit code, as recommended.

It seems BNB Paribas is a good BoA partner in France. BNL D'Italia in Italy.

Anybody have any recommendations about Spain banks? BoA does not list any institutions in Spain.

kybourbon

Scroll down to the chart for charge comparisons of different banks. It only lists a few credit unions, but you can see from the chart most don't have fees or just charge 1%. My credit union issued credit cards don't charge high fees either.

http://flyerguide.com/wiki/index.php...reign_Exchange

Motorino

Great link kybourbon. Thanks. I see I am using the wrong bank in many cases and it does suggest that no advice fits all situations, which is why it is always best to check with your own bank before traveling. Unfortuantely many fo these banks are not available in eveyr city in the US, which adds another layer of complexity to getting the best card.

I do wonder if the chart is 100% correct, as if it is then it does raise a question about the 100% certainty of this comment:

""J62 on Jun 3, 11 at 5:49am
I also use Bank of America and I am 100% positive, with certainty, that when I use a BofA partner bank, when I record what the exchange rate on a given day, and I use my ATM on that day in Europe, my BofA will give you an exchange rate that is exactly the interbank exchange rate.

I've checked on the internet at the exact minute I've made the ATM withdrawal""



From chart it does appear that Bank of America is charging at least 1% on an ATM withdrawal and in many cases 3% on purchases abroad, which, frankly is my experience.