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How does a currency converter work?

By Famworld
How does a currency converter work?

A currency converter will tell you the value of your money in other currencies at the actual exchange rate. You can convert over 140 currencies quickly and easily on the internet.

Simply enter your amount into the converter currency calculator, select your source currency, your target currency and you're done.

There is only one fair exchange rate

Banks and other providers often set their own unfair exchange rates themselves. This means you pay more than you have to, and they pocket the difference.

While the changeover to the euro has helped to facilitate banking operations abroad, the issue of currency conversion remains topical outside the European zone. Several solutions will allow you to convert your money before your departure, but also on the spot: so, how to choose the most advantageous offer?

When it comes to conversion, there are several factors to consider to get the best rates and pay less when traveling abroad. In particular, you should pay attention to the exchange rates applied by the establishments of your choice, but also to the commissions and any hidden costs that are added to them. You can also compare the terms and cost of the different options available to you: exchange offices and banks, but also traveller's cheques, cash withdrawals and credit card payments.

Finally, don't forget to compare these traditional solutions with their 3.0 alternatives, such as the Wise multi-currency account: this digital platform allows you to make your withdrawals, payments and international money transfers with ease. Discover all our tips for optimizing your exchange costs when planning a stay abroad!

Where to change your money before going abroad?

When you plan to go on a trip or on a business trip outside the euro zone, several solutions are available to you to convert your money. However, the latter have different modes of operation, but also different costs. What are the different methods to change your money before you leave?

In exchange offices at international airports

Most international airports have one or more exchange offices. This solution is particularly practical, especially if you have to leave urgently. However, these establishments also have several disadvantages: in addition to applying high commissions, their exchange rates are not necessarily up to date, nor to your advantage.

At your bank

Most banks allow you to order foreign currencies of your choice in advance. And if this conversion method has many advantages, starting with its simplicity, it can however be expensive. Banking establishments practice higher exchange rates than the real rate, ie the "fair" price of international currencies. They can also apply commissions to this type of operation: ask your bank adviser before ordering your currencies from your bank!

With travelers checks

Traveller's checks, or travelers' checks, allow you to pay certain expenses abroad, particularly in tourist establishments such as hotels or travel agencies. You can also exchange them for cash: each traveler's check is subject to a fixed amount, with no expiry date. Be sure, however, to check their validity in the country where you want to travel: traveller's checks are only available in certain currencies.

Avoid leaving with too much cash

In general, you should avoid withdrawing (or changing) too much cash before going abroad. You will thus minimize the risk of theft, which is particularly high when travelling, while avoiding having to convert your foreign currency a second time when you return. However, exchanging your currencies abroad can also be expensive: discover the different options available to you.

Where to convert your money locally?

Do you want to convert your euros into foreign currencies after arriving at your destination? Remember to compare the different solutions before making your choice!

Change your money at the local airport currency exchange office

Just like French airports, airports around the world have exchange offices on their premises. But again, beware of commissions and high exchange rates! To get the best rates, avoid airport exchange offices, regardless of your destination.

Withdraw money from an on-site ATM

If withdrawing money from abroad has certain advantages, starting with their practicality, remember to find out about the cost of the operation. Indeed, the latter can be subject to a multitude of fixed or variable levies: exchange fees, but also ATM withdrawal fees and distributor fees may apply to your on-site withdrawals. In addition, your bank and the one in which you carry out the operation are likely to take variable sums from one establishment to another.

Are your withdrawals from abroad subject to fixed fees? Withdraw a substantial sum so as not to have to pay these fees several times.

Finally, don't forget to withdraw in local currency, and not in euros, to avoid the phenomenon of double conversion. This way, you will probably benefit from a better exchange rate.

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