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ATMs vs $$ to Exchange

My husband and I are debating whether it's best to bring cash with us to exchange at a local bank upon arrival, or rely on ATMs for the best rates. RS says banks can charge 8%; I don't ever remember paying such a fee but I'm thinking that maybe it was included as part of the exchange rate we were given. Any help is appreciated.

Posted by
17720 posts

You're bringing US Dollars with you to exchange at a local bank? No way. I last did that in 2000 and paid a high rate for the exchange - 4%, 6%, I no longer remember how much. ATMs will give you the best rates. Try to use a minor bank in the US. Major banks, like Wells Fargo, Chase, USBank will charge you 4% (3% discount on the exchange rate plus another $5 (1% on $500) for the process, at least 4%). A lot of local banks and credit unions will charge you 0% to 1%.

Posted by
7684 posts

Many banks in Germany simply will not exchange money for you unless you are a customer. The few that do, may charge you anywhere from 5-10 € to do the exchange, depending on the amount and the bank. The rate is better than what you get at the money exchanges though. Do not be fooled by "Reisebank", as this is the money exchange bank. Horrible rates and fees.

Using an ATM will be the easiest so you aren't roaming around the city, going from bank to bank asking if they will exchange your $500.

Posted by
2080 posts

This has been covered extensively here over the last several years.

Exchanging money is a service, and the fee will be upwards of 10%. if it isn't as in the sign says "no fees!!", then the 8-10% will be lost in their exchange rate that they will have set. Same if you pass US dollars to a merchant, he'll accept, but you'll lose 10 percent on top.
Getting money from an ATM via your ATM card from your own account costs about point 8 of 1 percent (0.8%) above the daily interbank published exchange rate. And hopefully you have an account that does not charge you a usage fee when you hit an ATM, European bank owned ATMs do not charge any fee for use.

This is your choice, do you throw away 8-10% of your money, or do you use it for yourself?

Posted by
17720 posts

I have to disagree a little with Larry about the charge from ATMs. Most major banks - Chase, Wells Fargo, USBank, those with foreign currency operations - will charge you 3% over the Interbank rate for currency conversion and an additional $5 per transaction for a "foreign ATM". With a normal withdrawal limit of $500, that's a min of 4%. Then they pay "The Network" in euro plus ~½% to actually execute the transaction. Keeping 3½% for themselves.

Some smaller banks pay the Network in USD plus 1% for the transaction and currency exchange and charge you just what they paid (or 1% more) plus the same foreign ATM charge you would pay at someone else's ATM in this country. Last time I checked, 1st Bank of Colorado charged 2% plus $2.

A few banks and CUs just eat the 1% as a service to their customers. My higher balance checking account with Wells Fargo gives me two "free" European ATM withdrawals per calendar month.

Posted by
478 posts

My bank will charge a service fee of $1.50 per transaction plus around 3% of the withdrawal, so we will go with this.

Posted by
2080 posts

Now just to correct Lee's posting re the fees.
Why would you use a bank that charges fees like that?
There are various banks out there, Capital One and Schwab immediately come to mind, along with various credit unions, they have all been mentioned here, who do not charge fees for ATM withdrawals, and they pass on the interbank rate at ~0.8% surcharge for your foreign withdrawal. I even added "And hopefully you have an account that does not charge you a usage fee". Not only that, these banks won't charge you for getting your money from them here. These accounts can be set up online, and you can authorize transfers to them from another account electronically.
Why would anyone bank with an institution that makes you pay them when you want to use your money?

Posted by
4509 posts

Why would anyone bank with an institution that makes you pay them when you want to use your money?

Maybe because some people are overall happy with their bank? I am. Give people information, but this borders on insulting those of us that don't do it just the way you do.

Posted by
2080 posts

They a said they are torn between bringing cash or relying on ATMs for the best rates.
I gave how to get the best rates from ATMs.
I don't understand why information that does not produce the best exchange is given.

Posted by
17720 posts

"I don't understand why information that does not produce the best exchange is given."

For the same reason that you mentioned the rate from currency exchange counters - "Exchanging money is a service, and the fee will be upwards of 10%." - as a warning. Many people have ATM cards from major banks and don't realize how much they could save with other institutions. Everyone should know what their financial institution charges. Here is a website that summarized charges from US banks.

Wells Fargo charges most customers 3% + $5 per ATM withdrawal, but my acct gives me two "free" ATM withdrawals per calendar month. My 3 week trip last year spanned two calendar months, so I got four free withdrawals, but my girlfriend uses a local credit union that eats the Network charge and also gives free withdrawals.

BTW, I can't tell about Cap One ATM cards. Their website seems deliberately vague about them; they seem to want you to use their credit cards, which are fee free, but many credit cards (Chase United Explorer, for example) are fee free. But as I have previously pointed out, the most economical (not cheap) places to stay in Germany (family run B&Bs) don't take credit cards. If you stay in a place that takes credit cards, you will usually be paying a bigger "surcharge" than what it takes to get the cash for places that don't take plastic.

Posted by
9363 posts

Without question, it is cheaper (not to mention easier and more secure) to just get cash from an ATM once you arrive. Yes, make sure your bank knows you are traveling and where, and find a low cost account. I use a small local credit union that charges me nothing. As a backup, I also carry an ATM card from an online bank, which charges 1% (they refund "out of network" fees at home, but not abroad). I have my two accounts linked, so I can easily transfer money from one to the other online if necessary. I don't have to find a "partner" bank or any special network - one card is VISA and the other is MasterCard.

Posted by
4509 posts

@ Larry

They a said they are torn between bringing cash or relying on ATMs for the best rates.
I gave how to get the best rates from ATMs.
I don't understand why information that does not produce the best exchange is given.

Because you made it sound like anyone that didn't change to a no-fee bank was an idiot. Maybe you didn't intend to imply that, but it seemed pretty blunt to me. My point was just give the information that there are banking options with little to no fees available. Plenty of people are perfectly happy with their current banking and don't mind paying a few fees on a 2 week vacation rather than opening new accounts, such as myself.

Posted by
638 posts

Leave the U.S. cash at home. As Nancy said, it's just cheaper and easier to just use the ATMs, they're everywhere, just make sure you use one that belongs to a bank, not a money exchange service. No matter what you're going to be charged a fee to access your money, in the long there is no point in carrying around the amount of cash you'll need for your entire time in Europe. The only thing worse than taking a lot of cash to Europe is planning on taking Travelers Checks, the dinosaurs of European travel. And again as Nancy said, notify your banking institution of all the countries you'll be traveling to.