coming to the US - should i buy $ here or there for best exchange rate?

[Newbie 0]

hi - this is something i never really considered too much.

In the UK it's very easy to buy AmEx travellers cheques which i can use anywhere in NY pretty much. Today's rate is £1 = $1.79.

Do any financial peeps know if it's better for me to bring a bunch of cash with me from here to there and exchange it there for dollars?
I don't want to use my card - they charge 2.75% of the sale amount as a transaction fee. I don't particularly like to carry much cash with me anywhere, but if i can get a much better rate in the US, i will do so.

Thanks if anyone can help.

"Skydiving is a door"
Happythoughts

[PhillyKev 0]

Don't know where to get the best rates, but I'd make the exchange this week if you can. The dollar hit all time low vs. the Euro yesterday, and Greenspan and the head of the EU bank are meeting on Friday, there will probably be a bump in the dollar after that.

[Newbie 0]

ok thanks. This is why i'm wondering - i'm flying out on monday and i have heard the dollar is in a slump but as you said, that could change soon.

If any US peeps have a few seconds to spare and could find out by calling a bank out there and asking what the exchange rate is for me, i would really appreciate it.
i.e. what they sell dollars at for UK pounds.

"Skydiving is a door"
Happythoughts

[AggieDave 6]

You don't have to call around to different banks. You just need to learn how to use Google.

http://www.bankofamerica.com/foreigncurrency/index.cfm?hlexp=x&olexp=x

--"When I die, may I be surrounded by scattered chrome and burning gasoline."

[pleifer 0]

oh ooh, I get to use something from my Finance class

I should not matter here or there. the reason for this is if there was a difference, there would be what is called a mis pricing, and you would be able to actually make money. What I mean is that if you came here for a higher exchange rate you could exchange over here, then exchange over there for a profit, just keep doing that and you would make money on each exchange.

My point is that if there was a better exchange here vs there, the market would be exploiting it and an equilibrium would quickly be reached....

there for my point is: euro for dollar exchange rate should be damn close either place

_________________________________________
The Angel of Duh has spoke

[Newbie 0]

damn! I knew there was a flaw to my plan!

Thank for clearing that up...

"Skydiving is a door"
Happythoughts

[Newbie 0]

wow - according to this:

http://www.bankofamerica.com/foreigncurrency/index.cfm?bac_pref=yes

you guys pay $1.95 for £1? Is that right?

We only get $1.79 for every £1 here. Someone somewhere is making a big ass profit...

"Skydiving is a door"
Happythoughts

[DShiznit 0]

http://www.xe.com/

[Newbie 0]

Quote

http://www.xe.com/

i find that isn't very reliable for consumer exhange rates (i.e. what we can get from our banks)

"Skydiving is a door"
Happythoughts

[GravityGirl 0]

Plus it's the travelling to and from where you are most likely to get mugged. So. My vote is get them now.

Where are you going?

~~~~~~~~~~~~~~~~~
Peace and Blue Skies!
Bonnie ==>Gravity Gear!

[Newbie 0]

yeah i dont like carrying much cash around with me. So yeah i'll probably just do it now - besides, as was mentioned above, the rates will probably be virtually in line or else people would be making a living out of this sort of thing.

New York, see the inlaws and have a nice relaxing break from here!

"Skydiving is a door"
Happythoughts

[Clarkey 0]

Depending how much I'm taking, I usually just take cash with me to the US. Pre-order through www.travelex.co.uk and you pick it up at the airport you're flying out from. You will lock in the exchange rate at the time of the purchase, and they're usually very competitive. £1 = $1.8037 at the moment with no commission. I think you need to pre-order at least 2 days ahead, and it's a lot better rate than buying from the banks or the counters at the airport.

[174fps 1]

Quote

oh ooh, I get to use something from my Finance class

I should not matter here or there. the reason for this is if there was a difference, there would be what is called a mis pricing, and you would be able to actually make money. What I mean is that if you came here for a higher exchange rate you could exchange over here, then exchange over there for a profit, just keep doing that and you would make money on each exchange.

My point is that if there was a better exchange here vs there, the market would be exploiting it and an equilibrium would quickly be reached....

look up the definition of the word "Arbitrage"

[Squeak 17]

Geez according to the Bank of America the exchange for Oz dolalrs is 0.833US$ here in Oz it's 0.77US$ that's a pretty significant difference 6cents in the dollar

You are not now, nor will you ever be, good enough to not die in this sport (Sparky)
My Life ROCKS!
How's yours doing?

[Nightingale 0]

I'm not sure what it's like at your US destination, but my experience in California is that it's a royal PITA to exchange money. I've still got about 80 euro from my trip to Ireland over a year ago. The average bank won't do a currency exchange.

[bob.dino 1]

Rightyo, this is something I know lots about.

There are two different rates - one for USD->GBP and one for GBP->USD. The difference is called the 'spread', and it's where the banks make their money. Everyone in the Foreign Exchange (FX) market pays a spread. The more FX you trade, the narrower/smaller this spread is. Mere mortals like us change bugger all money, so we get hurt on the spread.

Now for the fun bit: the worst exchange rate is the one you'll get at your local Bureau de Change (eg. Thomas Cook). You'll get a much better rate if you simply take your money out of an ATM in the USA using either your Mastercard/VISA or your ATM card. If you're with a UK bank and take money out abroad using your ATM card you'll most likely pay a 1.5% fee. This is still shitloads cheaper than a BdeC.

Anything that can be paid for using your CC should be paid for with that handy plastic.

If your ATM card has PLUS or Cirrus symbols on the back, it'll work in about 99% of ATMs across the world. And it'll happily give you USD.

There are only really two reasons for using traveller's checks: 1) you're travelling somewhere without ATMs or banks. 2) you're afraid of losing your cards and being without access to cash.

1) is not an issue in the US of A.

2) can be avoided if you keep your credit card and ATM card separate. One in the hotel safe with your plane tickets, and one in your wallet.

Note that you can walk into a bank with your CC and passport and take out as much money as you like. However, since pretty much everywhere in the US appears to take plastic, use it.

I can go on about this for ages, so if you need more info, PM me.

edited: for clarity.
edit2: in bold.

[bob.dino 1]

That's your spread mate - one is from USD->AUD and the other is AUD->USD. If you look in the window of any money changers, you'll see a buy and a sell price, and there's usually a 10-20% difference.

Which, to be honest, is fucking scandalous.

[BGill 0]

I hate the exchange rate. it's the worst it's been in the 4 months i've been overseas, so now when i'm down to the wire with spending money its even worse. $1AU = $0.78US, WTF is that?????

[rehmwa 2]

I only travel in the Far East, but I always do all my exchanges anywhere but the US. At home there is always a hefty charge to conduct the exchange PLUS the rate is worse.

...
Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[Deuce 1]

Withdraw your money from an ATM in the US. It will save you a ton.

Whatever your bank is, it should have an ATM service that is supported in the US. Just withdraw your money in dollars.

If you earn any money while here (gosh I don't know how) you can have the money posted directly back to your bank account if it is a check/Visa type card.

I've heard this happens in Sweden from time to time. And it is reportedly the best exchange rate that can be found!

[Newbie 0]

thanks for writing all that out for us Bob - however i just wanted to ask about charges. When i withdraw from an ATM in the US i get charged a minimum or £1.50 (about $3ish) whenever i use it - this is the minimum charge - i think it's 1.5% or minimum of £1.50 - something like that. This means if i hit an ATM 3 times in a day (to save carrying alot of cash aorund with me) i would be paying a minimum of almost a fiver (which i know isn't much, but i hate paying something for nothing, and this is a way for the banks to make money from nothing).

The other thing is my credicard company (most of them infact) charge 2.75% transaction fee. So if i buy something for say $200, i'm paying fees again that i can avoid by using my travellers cheques.

With this in mind, is it still better to use atm's and credit cards? Thanks for the help all!

"Skydiving is a door"
Happythoughts

[Squeak 17]

Quote

thanks for writing all that out for us Bob - however i just wanted to ask about charges. When i withdraw from an ATM in the US i get charged a minimum or £1.50 (about $3ish) whenever i use it - this is the minimum charge - i think it's 1.5% or minimum of £1.50 - something like that. This means if i hit an ATM 3 times in a day (to save carrying alot of cash aorund with me) i would be paying a minimum of almost a fiver (which i know isn't much, but i hate paying something for nothing, and this is a way for the banks to make money from nothing).

The other thing is my credicard company (most of them infact) charge 2.75% transaction fee. So if i buy something for say $200, i'm paying fees again that i can avoid by using my travellers cheques.

With this in mind, is it still better to use atm's and credit cards? Thanks for the help all!

I'd be looking for a new credit card if they charge you 2.75% to use the thing
I have a VISA card and I get charged nothing on tranactions (interest free for 30 days) or if I take out money from my credit facitlity they start charging interest from that point.
However, what I've done in the past (& will do again in January) is I put a large chunbks of money on my credit card so the balance is well into the BLACK, then I just use ATMs to withdraw UD$ and incure nothing more than the $1.00 - $1.50 fee for using a foreign ATM

You are not now, nor will you ever be, good enough to not die in this sport (Sparky)
My Life ROCKS!
How's yours doing?

[bob.dino 1]

Credit cards charge the merchant a fee, not the end customer... it sometimes gets passed on, but not always.

The ATM fee & potential credit card fee are much smaller than the bureau de change fees + spread you'd pay. So stick with the plastic!

As an aside, you know some places advertise 'no commission' foreign currency exchange? They just widen their spread, and make just as much cash .

But most importantly, have fun in the States

• Quote

[Newbie 0]

thanks - i have never found a credit card that doesnt pass on fee's to customers or a debit card that - when using an ATM - does not charge me for taking out currency. And not just in the States - this happens throughout all of Europe. Maybe it's a UK thing?

Thanks again for the advice!

"Skydiving is a door"
Happythoughts

[PhillyKev 0]

Well shit...I called that wrong. Figured Greenspan would say somthing good about the dollar, but he did the opposite and it crashed even further. Hope you didn't exchange yet.