An actual currency exchange example?

I can't give a specific example but I can tell you that my bank does not charge me a fee for ATM withdrawals in a foreign country, but they do charge me a fee for getting € (minimum $5, but depends on how much money I'm changing). I also know that the exchange rate I get from my bank when they sell me € is not as good as what I get from an ATM (as long as I request local currency and not the DCC they try to stick you with so they can charge you more). Right there, I'm saving money but I can't tell you exactly how much. I just know that every little savings helps because I travel on a shoestring budget.

I don't follow Rick's advice per se, but just use simple math. Keep in mind that US-based credit and debit card products are different than in Canada. If I want to use my credit union's ATM overseas, I pay a 1% foreign exchange fee on any withdrawal amount (with no limit on the number of withdrawals). If I want to buy currency from my credit union, I would pay somewhere around 7%. Since 1% < 7%, I use the ATM. There are foreign ATMs that charge their own flat fees, so I avoid those.

If you exchange physical cash, that involves an employee, in an bank branch or kiosk who has to be paid and rent has to be paid. The pieces of paper have to be securely transported, either from the foreign country to your bank (if you exchange there) just so you can transport them back again; or if you exchange in Europe your home banknotes which you brought with you need to be securely transported back to your home country.
All this costs money, which you end up paying.

If you get your cash from an ATM, all that travels between countries is internet messages, which are cheap.

BTW - "if I wanted $500 Euros" - the $ is not used for Euros or any other currency in Europe. If you write $, people will think you mean some sort of dollar.
The symbol for the Euro is €. Write "€500" or "EUR 500". All currencies have a 3-letter abbreviation which banks, airlines etc. use.
For example: GBP (or £), CAD (Canadian Dollars), DKK (Danish Krona) etc.

Allan, if I don’t have a sufficient amount of Euros saved from a previous trip, I purchase Euros from our bank ahead of time to ensure that I don’t need to make any monetary transactions when I land, and the next jet lag day. If I remember correctly, the minimum quantity to acquire from the bank was 300 Euro, and it was definitely less than $10 US dollars for that transaction, using the exchange rate I would have paid for an ATM transaction in Europe. After that money has been spent, I just use an ATM card with no fees in Europe.

For me, that slightly extra cost is more than worth it to not be stressing about money when I’m groggy, and not exposing my ATM card to theft when I am not 100% alert. It gives me much more time to make all of my ATM transactions at open banks, also.

So, less than $10 savings, That’s even less if your bank ATM has an international transaction fee. And, as my husband says, if your trip cost is a cup of coffee, that extra cost is just the drips leftover at the bottom of the cup.

Yes, I do have data from June.

But first, a few points...

Whether an ATM is best depends largely what options you have. The "consensus" that ATM is best also assumes you incur no fees, avoid fees there, and avoid DCC, otherwise savings evaporate.

Now for my experience, I was in Paris and Brussels at the beginning of June. I landed on May 30 and used an ATM at the airport. I then used an ATM on June 1 in Brussels.

• May 30...Withdrew 180 Euros...My Charles Schwab account had a debit of $201.15...meaning a euro cost me $1.1175

Going back on XE Currency, the Interbank rate for that day is recorded as a euro costing $1.1138. Rates of course vary by the minute, so impossible to know to the third decimal if you are comparing apples to apples, but I was able to get euros at a very small cost, a fraction of a percent, which is outstanding.

If I had gotten euros at home, the best I could have expected was a 5-7% cost or $1.16 to $1.20.

An edit....as far as fees are concerned, a common set of fees is that your bank charges you $5 for a non member bank transaction, and 3% for foreign transactions, then my 180 euro withdrawal would have cost me $211.50, or $1.1750 per euro, about the same as if you bought euros at a bank in the US.

Allan- . You also have to note that all banks have different schemes and fees. So Billy Bob using a no fee Farmer’s Credit Union that is local to his community simply won’t relate to you because you cannot use it. Others get an internet based account they only use overseas with $0 fees and no conversion bump applied (often Charles Schwab). They just fund the account before they go.

Example on $500. My bank, B of A has several schemes in play. Use an unrelated foreign atm and it is $5 per transaction plus 3% conversion fee bump over the pure bank to bank rate. Use a related bank, B of A has sister banks (Barclays etc) where the $5 fee is waived but not the 3%. So for $500 it costs ($5 plus $15= $20 or just the $15 conversion rate) depending on a generic atm or related sister bank. Watch out for private ATMs with their own fees. B of A sister banks have no such surcharges thus not in my equations.

Now if you want cash up front before leaving home with B of A there is no service fee (mailing charges waived if you get $1000 or more) but you pay a potentially higher conversion rate of 5%. So on $500 you would pay $25 over the international bank to bank rate.

However, if you have a higher account status with perks at B of A you pay only a 2% conversion rate over the bank to bank thus $10 on $500.

So total fees and bank to bank rate conversion adjustments on $500 can range from $10 to $25. I get cash ahead before leaving the US and pay the 2% or $10 per $500. To me the amount is minor and less of a hassle then opening a separate internet bank account for foreign use to save $10-30 on a trip. If I have to grab an ATM overseas I know the sister banks and use those to eliminate the $5 fee.

I have dealt with a bank ATM in Rome eating an ATM card and credit card number theft in London so I prefer cash for most smaller transactions- time is money and avoiding lost time over such issues has value to me If I’m spending close to $15,000 on a 3+ week trip I just absorb the $10-50 I may be spending on the slight bump in bank to bank rate, which I do keep to a minimum.

Warning: Many US banks and credit unions will advertise NO fees for foreign atm use. That is true as to a set fee; $5 per withdrawal etc. But that no fee rarely applies to the conversion rate. Few US traditional banks will give you the flat bank to bank conversion rate. There is a built in bump of 3-5%. It is not listed as a fee. It is just the conversion rate used. There are special banks like Charles Schwab were you can get, or dang close to it, bank to bank rates. I don’t bother to do it but I would never critique those who do.

Allan,

I don't have an actual example that you are referring to because I have never used an airport ATM for exchange upon landing. We usually have leftover currency from previous trip. That said, if we need currency upfront eg. (to pay for Apartment) we will purchase at our home bank ahead of time. When we need more currency we will visit an ATM connected to a bank as needed. Our bank ATM card does not charge fees in Europe.

Just to add- Both my husband & myself have our own debit card (different accounts) in case one of our cards gets lost...

@Jean-- I love your husbands point: "If your trip cost is a cup of coffee, that extra cost is just the drips leftover at the bottom of the cup." Well said!!!

I belong to 2 credit unions. Neither sells foreign currency. Neither charges any kind of ATM fee or exchange fee when I use my debit card(s) to get cash in Europe. I'm charged the straight exchange rate for the time I withdraw the cash. Also neither charges any kind of fee for anything I buy using my credit card(s) from them.

When you get foreign currency from a bank, they are selling it to you. Most banks are for-profit institutions, so they are charging you in some way for the exchange services they are providing, whether at home or abroad.

If you want to check on how much they are charging, use the Oanda app or something similar as close as possible to the time you order or get the foreign currency at home or get cash from an ATM abroad.

All that's assuming that you do not fall for the DCC (Dynamic Currency Conversion) option whether getting cash with a debit card or making a purchase with a credit card. The link is to the RS Travel Tip about that. The basic advice is to just say no.

P.S. As I post this, according to Oanda, 1€ = 1.10505 USD and 1£ =1.31417 USD. 1€ = 1.46127 CAD, 1£ = 1.73790 CAD.

I don't have the precise comparison that you describe: I never went to a bank and soon thereafter an ATM, to compare.

I can make small sample comparisons between bank-based exchanges and ATM-based exchanges, each in relation to the published, historical exchange rates on those dates.

BANK SAMPLES: April 21, 2015
Euros purchase at a bank (Wells Fargo)
Bank rate I received: $112.40 for €100
Historical published rate: $107.38 for €100
Bank rate % higher: 4.67% ($112.40-$107.38) / $107.38

GBP purchase at a bank (Wells Fargo)
Bank rate I received: $155.85 for £100
Historical published rate: $149.26 for £100
Bank rate % higher: 4.42% ($155.85 -$149.26) / $149.26)

ATM SAMPLES: October 14, 2019
Euros at an ATM (Commerzbank, Nuremberg, no ATM fees charged)
ATM rate I received: $110.64 for €100
Historical published rate: $110.25 for €100
Bank rate % higher: 0.35% ($110.64-$110.25) / $110.25)

Czech Koruna at an ATM (CSOB, Prague, no ATM fees charged)
ATM rate I received: $4.278 for CZK100
Historical published rate: $4.256 for CZK100
Bank rate % higher: 0.52% ($4.278-$4.256) / $4.256

In these small samples:
- the bank charged 4.42% and 4.67% over the published historical rate
- the ATMs charged 0.35% and 0.52% over the published historical rate

Source for historical rates: www.exchange-rates.org

Unless you want to get the currency for your entire trip before you go, the difference in cost is minimal. (And if you DO want to carry all your cash from home ... ask about the wisdom of that on another post.)

For Allan in Alberta, there are only a few small financial institutions in Canada's highly centralized banking system that will let you use foreign ATMs without a service charge. Small means marginal, although not necessariiy doubtful, but perhaps hard to find. The charges vary from bank to bank to credit union, but the exchange rates are pretty much uniform.

Allan, are you taking into account the differences between an ATM at the airport, versus an ATM in the city? There is a cost associated with the convenience. Whether its significant or not is your choice.

My bank charges a fixed fee of $15 per currency transaction, regardless of the amount, plus their "market rate" is somewhere between 7-10% lower than the interbank rate of the day. Foreign ATM withdrawals have a 3% fee. Yes I know I could do better, but I'm not changing banks to save a few bucks for that one trip abroad every year.

Just a note, I got rid of some leftover British Pounds at the LA airport this week. They gave an effective rate of $1.07/1£, versus the day's published interbank rate of $1.17/1£.

Wow, considering the actual interbank rate this past week varied from 1.30 to 1.32 USD/GBP, I'd say you got hosed.

Yep, I paid for the convenience of getting rid of them, since I don't have a future trip to the UK anytime soon, and don't know anyone who is planning one. I didn't want to get stuck with obsolete bills as I have in the past.

I work in the financial markets and spend hours looking at major currencies. I’ve seen the laughable rates at currency exchanges plus the not quite as laughable rates at banks, but still pretty bad.

If you’re buying and selling physical foreign currency, you’re holding risk. Let’s assume there’s an announcement that Greece has decided to default on some bonds and the Euro plummets when trading opens at 5 PM Chicago time tomorrow. If you’re a currency dealer, now you’ve got Euros that you bought at a particular price and now need to sell them at a lower price against all western currencies.

I don’t look at Asia much but China has obviously been in the news lately. Those type of events can rock the markets as well.

I may as well fire the first shot and mention that Western Europe is far more cashless than the USA and you should consider finding a contactless credit card to use for most purchases when you get an interbank rate.

One receipt from my 2018 Sicily trip when I used a Bank of America ATM on a military base.
Community Bank, Italy, Sigonella
$472.92 withdrawal
400€
Conversion rate 0.8458
Then it gives my account balance. So, the rate from the ATM was $1.1823 per 1€. The official exchange rate for that date was 1.1767.

I always get Euros or Pounds at the end of a trip so I have some for the next trip. Because of the currency fluctuations, sometimes you come out ahead, others, you lose a little.

Stan, obsolete British banknotes don’t lose their value. After the transition period you just need to go to the Bank of England in London to exchange them for new bills. No fee is involved.

Dale of Chicago: ...Western Europe is far more cashless than the USA and you should consider finding a contactless credit card to use for most purchases when you get an interbank rate.

Dale presents a Gordian Knot solution to the currency exchange question. The better credit cards not only do not have a mark-up converting at essential Interbank rate, but often come with "rewards" in the form of cash-back or air travel "points". For example Capital One Quicksiver Visa does not charge a foreign transaction fee and rebates purchases at 1.5%.

That said, accounts such as Charles Schwab Debit/ATM don't need an example because they "exchange" at Interbank rate with no added fee: https://thriftytraveler.com/atm-fees-charles-schwab-debit-card/

I guess to comment on some statements above...

are you taking into account the differences between an ATM at the airport, versus an ATM in the city? There is a cost associated with the convenience

There are no fundamental differences between an ATM at the Airport vs "in the city", Your card charges no differently, any ATM may charge fees which are disclosed in either case, and either can offer DCC. I get cash at the airport all the time from an ATM, never any additional cost as long as I do not pay a fee or succumb to DCC, and no different than if I got cash in town, even if I use one of the dreaded "Travelex" ATMs.

My bank charges a fixed fee of $15 per currency transaction, regardless of the amount, plus their "market rate" is somewhere between 7-10% lower than the interbank rate of the day

Just semantics, but your bank did not sell you currency for Lower meaning less than interbank rate, It was likely 7-10% above the Interbank rate. If you bought today, you likely would pay about $1.19 for a euro instead of the interbank rate of $1.11.

That said, accounts such as Charles Schwab Debit/ATM don't need an example because they "exchange" at Interbank rate with no added fee

I have a Charles Schwab account, and I read through the linked article. True, Charles Schwab charges no additional fees for transactions. True, Charles Schwab reimburses you for direct flat fees incurred at an ATM. However; the Charles Schwab card is Visa branded, and Visa builds in a fee for the transaction that amounts to about 1%. However, due to fluctuations in currency markets through the day and their ability to lock in at one of the lower rates of the day, it means you typically see something from about market rates to 1% above market rate. In less likely instance (a volatile market) you might even see just under market rate. But regardless, you are still incurring a fee not reimbursed by Charles Schwab, it is just something built into the network. This is exactly the same as many experience at a Credit Union that charges no fees, a cost of up to 1%

The network fee is "up to 1%" and varies depending on the amount of dollar volume the specific bank or credit union has with the network. It is billed as one lump sum to the bank, not individually in the transactions. Larger banks do pay a smaller fee, as low as 0.25 %, and may or may not pass it on to their customers. This fee is required by law in the US to be reported as a separate line item on your bank statement if it is passed onto the customers. Capital One does not pass this on for their fee free accounts so they really are fee free.

The variation you might see in the exchange rate from what is reported on the transaction and what the exchange houses report is due to Visa and MasterCard setting their own rates for items settling that day. These rates are very close to the official exchange rates and really have very little if any impact on the cost of the transaction at the range of amounts tourists normally encounter.

Allan,

I have been using ATMs to get cash while in Europe (and the rest of the world) ever since that was a possible choice. I have an account at a bank I use when traveling that charges exactly ZERO fees when getting money from an ATM. It has always provided me that exactness. If I type in a foreign currency on Google and ask what the equivalent in US$ is, it always matches what my bank statement shows for transactions posting that day. And until recently, most bank owned and operated ATMs in Europe had never charged any fees at the ATM for getting money. So my cost of getting cash has always been zero over the exchange rate itself. This bank does not offer foreign exchange service to get cash before leaving the US.

My other bank does offer foreign exchange service where you can buy and sell most non US currencies. They do have an exchange rate markup of around 8 - 10% over the Google rate. When I checked Friday, their rate was US $1.25 = EUR 1. The Google rates $1.11 at the time I checked. At 14 cents per Euro, €1000 would cost me $140 more than getting the same amount from an ATM on arrival in Europe at an ATM with no fees.

And there is no difference in using an actual ATM at the airport and in the city or elsewhere. True there are many ATM looking devices the airports, mainly operated by Travelex, that are extensions the exchange desk right next to it and not true ATMs that charge their own rate. But if you look around, you can find one that just lets you get the cash you want. Watch out for Dynamic Currency Conversion where the ATM or merchant offers to charge you in your home currency, "for your convenience". It isn't for anyone's convenience except their own because the use their own exchange rate of up to 15% more in their favor.

So, the short answer is Yes, I always find that using an ATM in Europe (with the above stated conditions) is less costly than buying currency at home before my trip or any other method of obtaining the foreign currency I need. However, you will just have to do the math. What would the total cost be for getting a specific amount of foreign currency from your bank including fees and exchange rate markups before your trip compared to using ATMs in Europe with the fees your bank charges.

I use ATMs from banks that have international partnerships with mine meaning with my debit card, I am charged no international fees or any fees whatsoever.

Getting foreign cash at home is akin to setting fire to my own money. What an absolute ripoff.

Dale of Chicago.
I have a couple of mates who have in the past worked on the forex desk. Keep on trading.

Our banks and financial institutions issue Travel Money Cards, a debit card provide via M/C or Visa. 11 or so currencies can be loaded on to them to be used overseas. I assume that you are likely to be aware of these. I use one issued by Qantas. Easy and secure, chip and PIN.

Do any of your financial institutions issue similar cards/instruments?

Regards Ron

Any such products in the USA are total rip offs.

Dear Sam

I am sorry to hear that is the case.

Regards Ron

Ron, the add money to a card products are basically used by the unbanked here in the USA or people that live only in a cash world. May not always be criminal money, sometimes there’s a wage garnishment from bank accounts for tax reasons or court cases. So, they’re not really an option for Americans as they come with high fees.

I will also mention that if someone is going to be sweating it for 8 hours on the plane over because they don’t have local currency then just get some in the USA and be done with it. It’s not good value but it’s a small fraction of the cost of a European vacation and worth it for the peace of mind.

Meh, unless you're buying a factory the cost differential isn't worth the effort spent writing about it.

Fast Eddie- the issue is that some folks (and maybe rightly so under their economic circumstances) come totally unglued at the thought of losing $1.88.

Dale, thanks for the reply. Thought I might share with you how the travel card works. In my case from Qantas and doubles as my frequently flyer card/access.

Card is issued free, is my boarding pass for domestic flights with Qantas and entry to domestic airport lounge. No paper.
Gives me membership of Oneworld with sapphire privileges hence, lounge access.

When I am taking a trip or vacation, I can select the forex rate and day, execute the order and the monies are available next day. No Fees. Two months, two weeks or two days before departure I can execute the order. The card has a limit of $100,000AUD.I can do this from anywhere, well maybe not China, Russia or other non-secure countries. To best of my knowledge all western European countries are secure. Can be done with my smartphone hotspot. Have never had to do it yet.

Should AUD drop against a currency, I have effectively hedged. Other way, I lose.

I am controlling my forex by deciding on trends and am solely responsible for the rates, not a trader or credit card issuer.
The chip in the card recognises which country I am in and its currency. There is a small fee for cash withdrawals. Don’t have to do this often. For 6 weeks, late 2018, withdrew on 3 occasions. However not fees when I make a purchase using the country’s currency loaded on my card. I have a $100 AUD contactless limit after which I enter my PIN. Have been using for at least 8 years, and cannot remember signing a credit card transaction at home for at least 15 years. Only carry about $40 cash on me at home.

Disclosure: I hold shares in Qantas and CBA.

Dale, you may wish to check out the Qantas website and let me what you think about it from a forex perspective. At present no tax on any forex gains. Alas, no claimable tax loss on forex loss.
Regards Ron

Tassie,

The card you describe is the exact opposite from what is available to us in the US. If I could, I would get that card for my travels.

Our similar cards in the US have a fee for everything. $15 to just get the card. A fee on every transaction (ATM withdrawal, purchase, adding money, checking balance, EVERYTHING). If you don't have enough value loaded for a given currency and you have another loaded, they will move the money to the needed currency, but they change it back to USD first and then into the desired currency. And, you guessed it, they charge a fee for each of the conversions using their choice of rate. If you no longer want the card, you have to pay a fee to get the remaining funds off the card and the conversion is done at their rate. Also, you cannot use the card in the US, only in other countries.

Needless to say, but not a popular item here.

Mark, many thanks for your concise reply. It has in helped me understand many of the posts and concerns about currency conversion. Some quite intense calculations.

Yes, I had one of those from my bank, with the fees, I think back around 2003, when they were introduced here. Just checked my bank’s website, still being offered and but with many fees now gone. However, if not vigilant about which currency was being used it would be easy to rack up fees.

I think I will stick with my Qantas Frequent Flyer card.

Best wishes on achieving all the Rick Steve’s tours. Maybe we will come across each other sometime, somewhere.
Regards Ron

Today Wells Fargo will sell you Euros for $1.165. The real price for euros today is $1.106. At an ATM you will pay $1.106, the real price. 500 euros from Wells Fargo costs $582.50. 500 euros from an ATM is $553. So right at an additional $30 cost or 6 percent.

That's not considering issues like successfully predicting how much cash you need for your trip or the risk of carrying a lot of cash

IMO the bigger savings comes from having the appropriate bank account for traveling. Wells Fargo (like most big banks) charges $5 per transaction PLUS 3 percent. To keep it simple, $8 on a $100 transaction, for the same $500 transaction it's $5 plus 3 percent of $550 (500 euro) $16.50, $21.50 (smaller than $30 to buy euros ahead). Again there's an incentive to take larger withdrawals (up to your daily limit) to reduce the $5 per transaction charges - but your right back to carrying large amounts of cash. If you bring back euros, you'll pay again to trade them back into dollars.

It's not hard to find a credit union or smaller financial institution that charges only one percent (and no fee) or $1 on a $100 transaction. On the 500 euro transaction you would pay one percent of $550 (500 euros) or $5.50. Some financial institutions have free options that require a product, service or minimum deposit level. If those work for you, great. If not, open a travel checking account that only charges one percent. I really like knowing I don't have to worry about cash. If I need 40 euro, it's one percent. If I need 300 euro, it's one percent.

European ATM's generally don't charge a fee (I've heard rumors that some now charge). Be wary, however, of ATM look-alikes in Europe. Travelex is putting in lots of machines and charging the same exchange fee your bank would charge you, often adding a transaction fee. Last time in Dublin, you had to search through the airport to find a Bank of Dublin ATM. Travelex machines were ubiquitous, both in the airport and on the main road downtown. If the ATM name has "ex" in it, assume it's an exchange booth and look for an ATM with "banc, bank or banco" in the name.

The last thing I'd mention is daily withdrawal limits. You have two that you may run into. Many ATM's have individual transaction limits (I've run into 150 euros regularly). If you want more, the machine will reject your transaction. Sometimes it's hard to know why your transaction is being rejected. It doesn't look much different than a machine just not working. There is also the daily limit on your card. Most banks impose a limit of around $500 per day as a protection for you. Your bank can tell you what your limit is and whether they will change it at your request (most won't). The limit normally refreshes at midnight where your bank is headquartered (not where you are traveling).

Thanks to some of you for your examples, I think this may be the most relevant statement I read;

So, less than $10 savings, That’s even less if your bank ATM has an
international transaction fee. And, as my husband says, if your trip
cost is a cup of coffee, that extra cost is just the drips leftover at
the bottom of the cup.

We have typically taken cash for day to day expenses and used our credit card for the larger purchases such as hotel, or if we're buying from a machine such as train tickets. Personally, I've never thought it a big deal to carry 1000 Euros or Pounds in a money belt, but that's an idea for another post. I'd be curious if opinions will differ between Canadians and Americans.

However, regarding the cup of coffee comment, it is very true. I'm not charged a additional fee to take out foreign currency at home, and my bank routinely has Pounds and Euros on hand and I don't have to wait. As of this morning, if I was to buy 1000 Euros, my bank would charge me 1.51070 (Canadian to Euro). Now the current international rate is 1.46223 and assuming what many of your are saying and you're not experiencing mark ups at ATM's overseas, if I were to withdraw 200 Euros 5 times $292.446 + $5 (my bank charges me $5 for every foreign ATM withdrawal) = $1487.23, which is a savings of $22.77. Since I can't use my debit card outside of Canada for any transaction except for at an ATM, I have to use a credit card for any other form of purchase. My bank charges me 2.5% plus the exchange, so 1.51070 + 2.5% = 1.54846. If I made 10-100 Euro transactions, it would cost me $1548.46 which is $61.23 more than paying cash taken from an ATM. So it is just drips at the bottom of the cup.

In summary, since I'm not on a shoestring budget, my original post seems to be much ado about nothing.

Allan, when I read your original post that is what I thought “much ado about nothing” after reading all the posts, agree, the amount of money is not worth losing sleep over. And I have no choice as I checked with my local credit union bank and I can’t get euros from any bank in Alaska.

Travelex is putting in lots of machines and charging the same exchange fee your bank would charge you, often adding a transaction fee. Last time in Dublin, you had to search through the airport to find a Bank of Dublin ATM. Travelex machines were ubiquitous

I would just note that this is not always the case. Travelex has been making deals to serve as the ATM Vendor for various airports, Heathrow is a notable example. I have used Travelex branded ATMs a number of times and have not incurred any fees or Currency conversion costs. They usually do offer to make the conversion (DCC) like an increasing number of ATM's, but you have the option to decline DCC and do the transaction in the local currency.

I can't speak for all banks, but mine-RBC has a handy search on its website that allows me to find the closest affiliated ATM and maps it out on google maps for me.

Have read this post with interest, and it appears that the conclusion reached is that the savings from using an ATM are not all that substantial, especially, if you get dinged with the flat fee for using a foreign ATM each time (like Allan, I am in this boat too). This means I tend to withdraw larger amounts anyways, and besides one also doesn't want the annoyance of having to find an ATM every single/other day, even if one didn't incur this added fee. When I have exchanged the money at home and taken with me, I am still taking the same precautions as I would have with carrying a still sizable amount of cash (same as would have occurred with taking it out of an ATM), but can instead enjoy my trip without this distraction. I have observed that although it seems like a little thing, it can become the focus for a portion of your travel day. For me, even that amount of time and energy saved for something else while travelling outweighs the dollar amount saved. Stated mathematically (this is for Allan who likes equations and calculations): TIME + ENERGY > $$ (saved from) ATM.

I have used Travelex branded ATMs a number of times and have not
incurred any fees or Currency conversion costs.

Since I don't live in London, I can't run down to Heathrow and try an ATM, but I can tell you what it would cost today in Denver from a Wells Fargo bank or a Travelex store, because I just came off their websites.

Just a few minutes ago, the Interbank rate per Oanda was $1.095 for 1 euro.
On the Wells Fargo website, they wanted $1.129 for 1 euro.
On the Travelex website, they wanted $1.203 for 1 euro.

That's the conversion rates with no shipping fees. in the past I've ordered small amounts of foreign currency (~$40) through my local Wells Fargo branch, and the main branch delivered them to the local branch, and I paid no shipping fee.

So WF was 3.1% over the Interbank rate. That's really an aberration, Wells normally sets their rate in the morning at 5% over the Interbank rate and keeps their exchange rate the same all day, even when the Interbank rate changes. In this case I have to assume that the Interbank rate has gone up during the day, making their fixed rate lower.

Travelex was 9.9% over the Interbank rate and 6.6% over the Wells Fargo rate.

When I do travel domestically, I often see Travelex currency exchange booths in airports. I note Travelex's rate and then use my computer on Wifi to find the Travelex rate. At these exchange booth, I often see their rates at 10% - 14% over the Oanda rate at the time.

You say you never incurred any fees or currency conversion costs, but without seeing the rates you actually paid and the date, I can't confirm that. Travelex obviously gets you every where they can; I can't believe they're not doing at ATMs also.

the general consensus is it's cheaper to use the ATM because Rick says so

No, because I say so. Trust me!

But they -Travelex -are apparently not doing the gouging at ATMs. Their ATMs are not converting cash, they are accessing your bank account for the local currency and the network is converting. I did this at a Travelex ATM in Heathrow, and the conversion was the same rate I received at a NatWest Bank ATM in London, roughly 1/3 of 1% above the daily posted rate, which is what that card always gets me.. this was a couple years ago, and if no one else can try this sooner, I will do another 20£ withdrawal next time through in the fall and post. However, others have reported this as being correct more recently.

The thing to look for here is the network label - Visa/Plus/MasterCard etc. If that is on the ATM it doesn't matter who owns it, you can route your payment through it. Of course it may have a posted usage fee, plus attempts to distract you into using its own services through DCC, but that is the case for bank-owned ATMs as much as 'independent' ones. Indeed in the UK at least some ATMs that look as though they are owned by a bank are actually operated on their behalf by an independent. They make their money through the network fees if nothing else, which is often enough for a high volume location such as an airport.

I'm with Lee. I don't spend massive amounts when I travel. In 20 days, I probably use an ATM ten to fifteen times - primarily because it costs nothing extra to take small withdrawals rather than fewer large ones.

One could argue I'm only saving $7 each trip to the ATM, and be technically correct. I look at it as $70-100 I can spend where I want instead of gifting it to a bank.

Not carrying a lot of extra cash is a security issue. If you lose your cash to a pickpocket, or simply carelessness, losing $40 dollars is much less expensive than losing hundreds.

ATM's are also much more convenient that getting foreign currency before your trip. It may be different in Canada but at most U.S. banks, you have to order currency, wait, then make a trip to the bank to pick it up.

Is there a single upside to purchasing currency from your bank before a trip?

I think there's quite a difference in the situations in Canada and the US. Canadians seem not to have the no-fee card options we have available. On the other hand, they seem to be able to obtain foreign currency from their banks (or other sources??) at a lower cost.

Unless you plan on taking all the cash you need for your trip with you, the real question should be about fees and percentages. It's not realistic for me to take all that cash on a trip so instead I focus on zero international transaction fee atm cards with low (1%)fees.

Since I don't live in London, I can't run down to Heathrow and try an ATM, but I can tell you what it would cost today in Denver from a Wells Fargo bank or a Travelex store, because I just came off their websites

Except that is mixing Apples and Oranges, you are talking Currency Exchange, and ATM takes money out of my account. The point is, the name on the ATM makes little difference, be it Travelex, a major bank, or Bob's ATM, they either charge a fee (or not), offer DCC (or not), and then your bank either charges a fee...or not. You just need to be aware of the costs. If you did seek out a place to convert physical USD to GBP, the costs would be comparable to what you see in the US.

My response above is to counter the notion that if you see "Travelex" on an ATM that you will be "ripped off", that need not be the case, and no more a reality than at any other ATM.

Is there a single upside to purchasing currency from your bank before a trip?

Sure there is.

Having a supply of currency prior to travel is a risk mitigation. I usually have currency from previous trips, and I do not recall ever having an issue getting cash at an airport on arrival...but I have a couple of accounts with proven card use and frequent travel. A new traveler, never having used a card, might be advised to get a supply of a couple hundred euro or whatever currency applies.

If you have a Bank, by choice or just because of no other option, that charges an out of Network Charge plus a FTF, then getting currency ahead really cost about the same as getting it there. I would not suggest getting all that is needed due to risk of loss, but I might bump that 200 up to 500, and I would probably withdraw larger amounts less frequently.

The other situation is a need for a large amount of cash for something like an Apartment payment, if your bank will not allow an increase to a daily limit. In that case, if they will not take partial payments, bank transfers, PayPal, etc.; then taking currency may be the only option. I tend to shy away from these deals, but I understand many like the relative low cost and accept the risk.

ATMs are the least expensive, next is your local bank or AAA, most expensive is a currency exchange at the airport. Use the last only as a last resort.