How to get a good deal on foreign currency


With many Aussies planning to take advantage of warmer European weather in the middle of the year, strong exchange rates in Japan and the snow season in New Zealand, you should make sure your money is ready to travel too.

Foreign exchange (FX) - or converting currencies - should be a top priority to organise ahead of your overseas trip to ensure you are making the most out of your hard earned money.

Getting the best deal can mean spending less on hidden fees and rates and more on well deserved holiday treats, so here are some tips for managing your next currency conversion.

how to get a good deal on foreign currency exchange

1. Look for simple pricing

There are often many layers of a FX transaction which can be difficult to decipher. For example, there can be different fees, exchange rates and transfer timings to consider for just one trade.

To keep things simple, look for a FX provider that offers a simple pricing structure; that offers the same fees across all currencies and purchasing outlets.

This will help you compare similar options when searching for the best FX deal.

2. Find the best conversion deal

Exchange rates can fluctuate as frequently as every hour, which for the savvy traveller can provide many opportunities to find a great FX deal.

In saying this, it may seem overwhelming to track global exchange rates every hour by yourself. To allivate this stress, choose a FX provider that offers real-time exchange rates to allow you monitor for the best deal to convert your money in the lead up to your departure.

Ideally the goal is to convert your money when the Aussie dollar is high against your destination's currency.

3. Keep an eye on fees

There are a number of fees that can be involved in a FX trade, such as processing, clearing and international transaction and/or transfer fees (or telegraphic transfer fees).

Look out for transparent and upfront pricing from your FX provider so you know the total cost of your transaction - and how much money you will be receiving.

If your provider doesn't provide clear pricing, you may risk receiving less money in the new currency than what you had budgeted for.

4. Multi-currency cards

If you are travelling to multiple destinations in one trip with different currencies, find a travel card that allows you to hold, spend and send multiple currencies within the one account.

Ideally this card would provide real time currency switching.

5. Local currency or FX at the terminal

You may be travelling with your local bank card that allows you to make international transactions, either online or at a terminal.

When making a purchase at a terminal, typically it's best to choose your local currency option to avoid any on the stop FX transaction fees.

6. Think ahead

If you're planning a holiday several months in advance, you can buy currencies in smaller amounts over time to average out the cost of conversion as exchange rates fluctuate.

Multi-currency transaction accounts are useful for this purpose and mean that you don't have to store physical cash at home for an extended period.

In short, we all love to treat ourselves while we're on holiday. By shopping around for the most competitive offer before you leave, you can make sure you're getting the best bang for your buck.

Get stories like this in our newsletters.

Related Stories


Jessica Power is the head of wealth and personal banking for Australia at HSBC. She joined HSBC in 2018 from Westpac, where she held several senior retail positions. Prior to that, she worked for Citigroup Australia. Jessica has a Bachelor of Economics, Finance and Marketing from Macquarie University, and a Master of Applied Finance from Securities Institute Australia.