The common wisdom seems to be "wait on getting Euros until you hit the first ATM in the airport" and then to "use your debit card without a foreign exchange fee." These are good pieces of advice, and I don't mind following them under most circumstances.
However, I have been doing some numbers on exchange rates and have factored in my personal handicap, peace of mind, and have a different view.
This morning, the euro to dollar exchange rate is 1 euro to every 1.12 dollars. I understand that this is the "exchange rate" but I am skeptical that it is available to mere mortals like me. I believe, perhaps cynically, that banks will always figure out a way to scrape off a "taste" when calculating the cost to consumers, and that no one actually gets the "exchange rate." Perhaps I am wrong, but I think the banks get the exchange rate as they swap billions of euros/dollars, and that the rate to consumers is not as favorable.
Here comes my "peace of mind" factor. I love cash. I pay for most things by cash, even in Europe. Hotels and retail shops get a credit card, but restaurants are cash recipients, as are grocery stores and much transportation. Sometimes, especially in Italy, I can get a discount for paying cash. When I travel, I like to have cash. Once, I arrived in London during the middle of a coal strike, and the power was down for significant parts of the day. ATM machines don't work without 220-240 volts of alternating current.
So, this morning I calculated how much it would cost me to purchase 1,000 euros. With the official exchange rate at $1.12 per euro, my theoretical cost would be $1,120.00 for the euros, IF I could get that exchange rate. This morning, Bank of America will sell me 1,000 euros at $1.1795 per euro, for a total of $1,179.50, or $59.50 more than the theoretical exchange rate at an ATM.
I understand that I am paying more for the cash right now, but unless I am off in my numbers, it really isn't that MUCH more. And, I will have a decent chunk of cash in my money belt to hit the ground running when I get through passport control this summer. I think the amount I am paying could be less if I get cash discounts at a few places, and my stress level will be lower than if I am looking for an ATM every two days.
Just my 2 cents.