Buy Euro now for a later trip

See -- Buying Euro's in June for Europe in July -- under General Europe or the dozen similar questions asked this past week and scattered through out this site.

If you want to buy euros now, one good way is to buy a prepaid cash card denominated in euros. You buy the card today, it loads with euros at today's exchange rate, then you can use it at a European ATM to withdraw the euros in future, whenever you want.

One well-known source of these cards is Travelex. You can get the details at www.us.travelex.com (No, I don't work for Travelex.)

Whether it's a good idea or not to buy euros now, you have to decide for yourself.

I would be very careful about viewing a prepaid cash card as a good deal unless you know the exact numbers. Prepaid cash card as consider gift cards and fall outside of the bank regulations that apply to debit and credit cards. Travelex is an currency exchange bureau and never known for providing good deals. I just reviewed the card on their web site. No information on the fees charged or the exchange rate -- a BIG RED FLAG. Information concerning the "loading commission" is only obtained from the selling office. There is 1.75E fee to withdraw money and a monthly fee of $2.30 and no indication of how you would change left over Euro back to dollars. A couple years ago the AAA visa cash card cost about 10% for the convenience of using that card. I am guess this is similar. Check the fine print -- TWICE

A debit card from a bank or credit union that does not charge currency conversions fees is the only way to go.

You should always read the fine print with any type of card.

I was recommending the prepaid card - denominated in euros - as one way to obtain euros at today's exchange rate, for use at a future time. This was the OP's question.

A prepaid card allows you to "lock in" today's exchange rate.

A debit card or credit card won't let you do this. The exchange rate will be whatever it happens to be when you use the card.

But the point is with a prepaid card you are NOT locking in the current interbank, or close to it, exchange rate. You are locking in THEIR exchange which could be inflated by 5 to 10% plus additional fees. The debit card exchange rate will always be less than 1% over the daily interbank rate which is the best exchange rate you can hope to obtain. It will change hourly but the changes over time are small. My personal opinion is that prepaid cards are bad deals. The only one I have seen that might be close to reasonable is the Wal-Mart prepaid but their details are hard to discover. But it US dollars only.

Frank is right that you pay THEIR exchange rate. Just for my own curiosity I called the Travelex office in downtown Chicago. Their exchange rate today for a prepaid euro card is $1.28. The wholesale exchange rate today is $1.238. Works out to a markup of about 3.4%. They have no other charges or fees to purchase the card - the guy I talked to said they make their profit off the exchange rate markup.

I believe 3.4% is pretty similar to the markup Sachin would pay if she bought euro cash or travelers checks.

Bottom line is that if you want to buy euros stateside you're going to pay a markup not matter what method you use.

Answer to #3: Fly to Europe ASAP - I leave tomorrow.

That's funny, Charlie. Hope you're having fun.

It is so easy to say now. The Euro is priced at $1.19 as of late June 4. Some traders predict a one for one exchange is possible. Speculating in the currency markets is best left for the specialists. But at one to one, I will stock up.

wayne

I was in Vienna for 3 days, a couple of weeks ago (between Prague and Budapest - great trip, by the way) and I took my $500 limit from the ATM every day, and then paid for everything I could using plastic. I came back with a moneybelt full of euros for my next trip!

I have friends going to Austria soon, and I am almost tempted to give them my ATM card and ask them to bring me some cash back.