Currency handling quietly removes several per cent from most travel budgets, because it disappears into a slightly worse rate here and a small fee there. Fixing it takes about an hour before you leave.
The four charges
The exchange spread, which is how bureaux make their money — airport ones take 8 to 12 per cent.
Foreign transaction fees on your card, typically 2 to 3 per cent on a standard account and zero on a good one.
ATM fees, in two layers: your bank’s and the machine operator’s.
Dynamic currency conversion, which is the one that gets everybody.
The single most important rule
When a card machine or ATM asks whether to charge you in your home currency or the local one, always choose local. Choosing your own currency lets the merchant’s processor set the rate, typically 3 to 7 per cent worse than your card issuer’s.
Some machines pre-select the home currency and make declining look like cancelling. Read the screen.
The setup
Two cards, different networks, different providers, kept in different places. A fee-free debit card for ATMs, a no-foreign-fee credit card for paying — credit gives you chargeback protection that debit does not.
Withdraw larger amounts less often, because operator fees are fixed per transaction.
Use bank ATMs, attached to a branch, not the standalone machines in tourist areas.
Carry $100–200 in clean unmarked US dollars or euros as an emergency reserve, stored separately. Several countries reject notes that are torn, marked or printed before a certain year.
Before you go
Tell your bank. Check the withdrawal limit. Set up an authenticator app rather than SMS two-factor, which is the single most common way people get locked out of their own money abroad. Photograph both cards and store the images encrypted, along with your bank’s international number — not the freephone one, which will not work from abroad.
Countries that are different
Argentina has had multiple simultaneous exchange rates. Cuba and Iran are effectively cash-only for most visitors. China runs on WeChat Pay and Alipay, which need setting up before arrival. Japan is still surprisingly cash-heavy. Closed currencies — Moroccan dirham, Indian rupee, Tunisian dinar — cannot legally leave the country.
The money guide has the full detail.