How to Exchange Currency When Traveling Europe (Money Part 2)

What This Video Shows

This is part 2 of my Europe travel money series. In this video I cover the important topic of how to exchange US dollars into Euros when traveling in Europe. There are three main options available to travelers, and I walk through each one in detail to help you figure out which approach gives you the best exchange rate and saves you the most money over the course of your trip.

Why This Matters

Getting the best exchange rate might seem like a small detail, but it can save you a meaningful amount of money over the course of a two-week vacation. The difference between the best and worst exchange methods can easily cost you 5 to 10 percent on every single transaction. Over an entire European trip, that adds up to hundreds of dollars in unnecessary fees and unfavorable rates.

Option 1: Exchange Currency Before You Leave Home

You can exchange US dollars for Euros at your local bank or a dedicated currency exchange service before your trip. The advantage of this approach is having Euros in hand the moment you step off the plane, which means you do not need to worry about finding an ATM or exchange booth when you are jet-lagged and disoriented. The downside is that bank exchange rates are usually not the most competitive, and many currency exchange services layer additional fees on top of their already unfavorable rate markup. If you go this route, compare rates between several banks and services before committing.

Option 2: Use ATMs in Europe

This is generally the best option for most travelers, and it is the approach I recommend based on my experience. European ATMs connected to international networks like Cirrus or Plus give you an exchange rate that is very close to the real interbank market rate. Your home bank may charge a foreign transaction fee of 1 to 3 percent, and the local ATM operator might add a small per-transaction fee. But even with those costs factored in, ATM withdrawals typically beat every other exchange method available. My tip is to withdraw larger amounts less frequently to minimize the impact of per-transaction fees.

Option 3: Currency Exchange Booths and Kiosks

These are the brightly lit kiosks you see in airports, train stations, and tourist-heavy areas. They are the most convenient option, but they almost always offer the worst exchange rates by a significant margin. Airport exchange booths in particular are notorious for their poor rates and high hidden fees. I strongly recommend avoiding currency exchange booths except in genuine emergencies when you have no other option available.

Credit Card Tips for Europe

Many modern credit cards now offer zero foreign transaction fees, which makes them an excellent option for purchases in Europe. If you have such a card, using it for restaurant meals, hotel bills, and shop purchases is often the single best deal available, because credit card companies generally use exchange rates that are extremely close to the interbank rate. One critical tip: when a European merchant offers to charge your card in US dollars instead of the local currency, always decline and choose to pay in the local currency. This practice, called dynamic currency conversion, applies an unfavorable exchange rate that benefits the merchant and costs you more money.

Quick Tips for Managing Money in Europe

Notify your bank and credit card company before traveling. Otherwise your cards may get frozen when the fraud detection system flags unusual foreign activity.

Carry some Euros in cash as a backup. Not all places accept credit cards, especially smaller shops, taxis, outdoor markets, and street vendors.

Avoid exchanging money at your hotel front desk. Hotel exchange rates are typically just as poor as airport kiosks.

Keep track of exchange rates. Use a currency conversion app on your phone so you always know what things actually cost in US dollars.

For part 1 of this series covering online order problems, check out that video. And for broader preparation advice, see my video on preparing for Europe travel.