The best way to exchange Australian dollars is by using a card for payments, as it is by far the most economical option. For carrying some cash, the best choice is to withdraw money from an ATM.
In other words, the best strategy to save money to the maximum extent would be to always pay with a card (as we will see later, in 2024, Wise card offers the best exchange rates and the lowest costs in the market) and only withdraw the amount of cash you will need from an ATM.
Certainly, this technique to save the most money possible on your vacations might surprise you. After all, if you go to any currency exchange or bank, you will see how it is loudly advertised that “there are no commissions,” and therefore, one might simply think that it would be logical to exchange dollars at the current exchange rate and that’s it, right? Well, no! Everything has a cost, even paying with a card has a cost, although they don’t tell you or you don’t see it at first glance.
I’ll tell you a secret: this website was created by a group of friends who have worked for several years in currency exchange offices, and frankly, changing cash is by far the worst option. Moreover, to give you an idea of the extent of this bad alternative, you should know that most currency exchange operators or bank employees have discounts for exchanging currencies compared to the exchange rates offered to customers. Even with these discounts, we never change cash. At most, depending on the trip, just a small amount for certain payments or in case it is necessary to enter the country.
So, it is clear: always pay with a card and only withdraw the cash dollars that you will need. Now let’s see how to pay the lowest possible cost in both cases:
What is the best card for paying abroad?
Based on the study we have conducted of all the cards available in the market for this year 2024, for paying in any foreign country, travel cards have a lower cost than bank cards, and among travel cards, the one with the lowest costs is the Wise card.
These results are valid not only regarding the costs of payments in international stores in foreign currency (Wise would offer the best conditions, other travel cards would be about 4 times more expensive on average, and bank cards about 10 times more expensive on average); but also in the costs of withdrawing cash in foreign currencies from ATMs outside your country (Wise would again offer the lowest expenses, other travel cards would be about 4 times more expensive on average, and bank cards about 20 times more expensive on average).
Also, if you want to know exactly the cost differences and functionalities between the different cards you can find in the market in 2024, do not miss our comparative study at this link. As you will see, this comprehensive study analyzes all types of cards (debit, credit, and prepaid) and all types of providers (banks, fintech, financial institutions, etc.).
Is it necessary to bring cards from our country abroad?
As we have mentioned, it is preferable to use the Wise card rather than a conventional bank card or other travel cards, as you will save a significant amount of money when paying in foreign stores and when withdrawing money from international ATMs by paying the lowest possible fees.
Thus, in principle, it would not be necessary to bring any other card, but keep in mind that, if you are going to make payments such as renting a car, you will need a credit card, as most car rental companies will retain an amount as a deposit and will only accept credit cards.
If, on the other hand, you are not going to make these types of operations, it is advisable to leave your bank cards with higher balances at home and only for security, it would be advisable to carry an extra debit card with a little balance in case of emergency (imagine that your other card is damaged or stolen, and you also lose your mobile phone, so you would not have anything to pay with).
Consider that in case of theft, there is a risk that fraudulent operations will be carried out with your cards with the limits they have, while with the Wise card we recommend, your balance will never go negative, so only the balance deposited in it could be spent.
In addition, you can instantly block your Wise card from your mobile phone, while with your bank cards, you may need to call your bank to cancel them, running the risk that they do not provide service at that time as it may be a holiday or outside of customer service hours.
For all these reasons, when traveling, it is always much better to carry a debit card like the Wise card with the amount of money you will need. If you need more, you can always reload it instantly through the mobile application, and if you want to block it for loss or theft, you can do it instantly through the application as well. This way, you will have full access to your money at all times, without paying fees for it and minimizing the risk of theft.
As you can see, this card has numerous features through the mobile phone, so it is important that you ensure your phone battery is always fully charged. To do this, remember that in many countries, the plugs are different. Therefore, it would be a very good idea to purchase a universal plug adapter for travel, as it can be useful for any trip you are going to make in the future. In this link, for a very economical price, we show you a universal plug adapter, as well as other ideal and necessary products for travel.
Finally, it is important to know that, if you are going to take your credit card to be able to pay deposits in operations such as car rental, before traveling, it is advisable to notify your bank that you are going to travel abroad and the limits you will need. Keep in mind that all cards have daily, weekly, and monthly limits, and that when traveling, you will spend more than usual, so, in case of having somewhat low limits, unknowingly you could reach your limit and find yourself in serious trouble.
What to do if my card runs out of balance abroad?
If your debit card runs out of balance abroad, you can always get money very simply:
- If you have a bank card, you must contact a family member or friend who is a client of the same bank, so they can make a transfer to your account. Between accounts of the same entity, the money arrives immediately, so when completing the transfer, your card will be able to consume the new balance of your account. Another option would be to make an “immediate transfer” between accounts of different banks, as it is also done immediately.
- If you have a prepaid card like Wise, you can make a recharge through the App (or someone can do it for you) and receive the money instantly.
What do I do if all my cards are stolen abroad?
If all your cards are stolen abroad, these would be your alternatives to get by:
- Use dollars you have withdrawn from the ATM: You can pay with cash in foreign currency in case you have made a withdrawal at the international ATM.
- Exchange your currency into cash: It is always advisable to carry some cash in your country’s currency in case of emergency, as you could change it to dollars at exchange establishments if necessary.
- Pay with your mobile phone: If your phone has NFC technology and your bank offers mobile payment service, you should link your mobile phone with your card, and even if it is canceled or blocked due to theft, you can continue paying with your mobile phone without any problem.
- Have someone pay what you need from your country: If you simply need to buy a plane, train, or boat ticket, anyone you know in your country could pay for it online and send you the boarding pass by mobile phone (or you could download it from the company’s application).
- Receive money through money transfer agencies: In most tourist cities, there are many of these agencies. In them, anyone you know could make a transfer from your country for you to receive the money abroad.
- Sell your jewelry in a gold buying store: In most major cities around the world, there are numerous gold buying establishments where they will easily buy any gold jewelry from you.
- Sell your most valuable belongings in a second-hand pawn shop: The most coveted and easily sold items would be technological products such as mobile phones or laptops, as well as quality clothing items and watches.
- Ask for money: The easiest way to get what you need would be to ask fellow countrymen who can trust you. If you need a small amount, the perfect place to ask is next to vending machines, as everyone receives change from them, and when asking, it is very easy for people to give you something.
- Go to your Embassy or Consulate: As a last resort, the representatives of your country can always assist you.
Where to find the best exchange rate for Australian dollars in cash?
As we said before, the cheapest way to get cash dollars is by withdrawing money from ATMs.
In any case, if you wanted to exchange cash dollars at an exchange office or bank, an exchange rate of less than 5% margin compared to the official exchange rate would be a good exchange rate. Between a 5%-10% margin would be an acceptable exchange rate; between a 10%-15%, it would be a bad exchange rate, and beyond a 15%, it would be usury.
The official exchange rate of the Australian dollar compared to your currency can be easily found on Google. By subtracting what they offer you and dividing the difference between them by the official rate, we will get the percentage of margin they would be applying to you.
Usually, highly trafficked areas of tourist sites are the worst places to exchange currencies, as they apply higher margins on exchange rates. Therefore, it is best to search online beforehand for the location of a good exchange establishment instead of going to the first one you see.
In any case, if it were to exchange a small amount of money, it would not matter much where to change it in case of necessity and urgency, since it would be a matter of assuming a small extra cost in the worst case scenario.
How much cash is enough for travel?
Exchanging cash only serves two functions:
- It serves as an emergency in case your card and mobile phone are stolen so you can at least get by: eat something, make a call, travel to the embassy if you need to request a duplicate passport, and get to the airport to leave the country.
- It serves in case we need to make cash payments: in some street shops, some vending machines, and to pay for some services, such as laundries, telephone booths, shopping carts that require coins, etc.
Thus, depending on the number of days you are going to stay and what you plan to spend in cash, you can calculate more or less what you need, which in any case should not be a large amount.
Is it possible to know if in the future the exchange rate of dollars will be better or worse?
The official quotations of all currencies function as a financial market just like the stock market. Obviously, there are analysts and financial gurus who make their predictions, but just like predictions about stock prices, with the data at hand, there is no evidence that anyone is able to predict future prices.
Generally, currency market quotes tend to be quite stable, and over the course of a month, they do not vary much more than 5%, unless an unexpected economic or political event occurs, such as the unexpected victory of an opposition party with a groundbreaking economic program.