Jan 28th 2009 Currency Conversion Tricks for Overseas Travellers
Are you travelling overseas soon? Do you know what the current currency exchange rate is for the main countries you’ll be visiting? Do you know what your dollar/euro/pound will buy you in Thai Bhat, Mexico pesos or Aussie dollars?
Foreign exchange trading is a big-boys game – but the average traveller can still have a little fun with it and save a bit of holiday cash. The trick is to know what your up-to-date conversion rate is and monitor it for a few months before you leave home. It sounds like a lot of work – but its not really – its surprising how quickly you will get a feel for the currency movements.
If you think your currency as strong as its going to get – then take the punt and lock in your foreign exchange rate by buying foreign cash, pre-paying expenses such as hotels and tours or by buying travellers cheques.
If on the other hand you think the exchange rate is low and may get better – try to delay your foreign exchange costs as long as possible. Put as much of your holiday expenses on your credit card giving you that extra month to pay when you get home – but don’t try this with a card that you don’t clear each month, otherwise your foreign exchange gains will be consumed by credit charge interest rate charges!
Knowing the the high/low points of your currency against the your holiday destination’s currency is important because then you guage where you are in the currency rate cycle – don’t believe the news reports which claim, “The Dollar Has Crashed” or “The Pound At XX Year Low” – the reality is that rarely does a major currency collapse against all players – sterling may be doing bad but the Indian Rupee may be doing a lot worse – check the explicit figures for your specific currency by using an online currency converter.
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