Best Way to Exchange Currency Before Travelling

What is the best way to exchange currency before travelling? It sounds like a minor admin task, but getting this wrong is one of the most common ways travellers quietly lose money — airport exchange desks and hotel bureaus can skim 10-15% off your holiday cash without you noticing. The good news: the best method in 2026 is also the easiest. Here’s the ranked list, from best to worst.

The Ranked List: Best to Worst

1. A fee-free debit card abroad (best for most people)

The winner, by a mile. Cards like Chase, Starling and Monzo let you spend abroad at the real Mastercard/Visa exchange rate with zero fees and zero markup. You pay in the local currency, the card converts at the interbank rate, done. No pre-ordering currency, no carrying wads of cash, no maths at a bureau. For 90% of travellers, 90% of spending, this is the answer. MoneySavingExpert’s travel cards guide keeps an updated ranking.

2. A specialist travel credit card

For larger purchases and the Section 75 protection (which covers purchases £100-£30,000 if something goes wrong), a fee-free travel credit card — Halifax Clarity, Barclaycard Rewards — is excellent. Same near-perfect exchange rate, plus credit protection. Just pay the balance in full; the interest dwarfs any FX saving otherwise.

3. Pre-ordered cash from a good online dealer

For the cash you’ll genuinely need (taxis, markets, tips, small vendors), pre-order from online specialists — Travelex online, Eurochange, or the Post Office — for collection or delivery. Rates beat high-street branches significantly. Order 3-5 days ahead for the best rates; last-minute airport collection costs more.

4. High-street bureaus (variable)

Marks & Spencer Travel Money and Debenhams-style bureaus are mid-pack — better than airports, worse than online pre-orders. Fine in a pinch, not a strategy.

5. Your bank’s travel money (usually poor)

High-street banks are consistently among the worst rates — the convenience of “while I’m here” costs you 5-10%. Avoid unless you enjoy donating to bank profits.

6. Airport and hotel exchanges (the worst)

The absolute bottom. Airport bureaus combine terrible rates with commission fees — you can lose 12-15% versus the real rate. Only for genuine emergencies (and even then, use an ATM instead).

What Is the Best Way to Exchange Currency Before Travelling? The Strategy

For a typical trip, the optimal mix is:

• 90% on a fee-free card (spend in local currency, always decline “pay in pounds” — see below).
• 10% in cash pre-ordered online for the cash-only situations. How much depends on destination: £50-100 for most of Europe, more for cash-heavy countries (Japan, Morocco, parts of Southeast Asia).
• A backup card from a different provider, kept separately. Cards get blocked, lost, eaten by ATMs — redundancy is cheap insurance.

The “Pay in Pounds?” Trap (Dynamic Currency Conversion)

Abroad, card machines and ATMs often ask: “Pay in GBP or local currency?” Always choose local currency. “Pay in pounds” (dynamic currency conversion) lets the merchant’s bank do the conversion at a rate 3-8% worse than your card would get. It’s presented as a convenience; it’s a surcharge. Local currency, every time, no exceptions.

ATM Strategy Abroad

• Use bank ATMs, not the standalone tourist ATMs (Euronet and similar) in city centres — the latter add hefty fees and push DCC.
• Decline the ATM’s conversion (“convert with our rate?”) — same trap as above, let your card handle it.
• Withdraw larger amounts less often if your card charges per withdrawal (fee-free cards usually don’t, but check).
• Never let the ATM do the maths for you — “would you like us to convert this?” is always a worse deal.

Destination-Specific Notes

• Eurozone: Cards accepted nearly everywhere; €50-100 cash suffices. See our Spain cost guide and Turkey spending guide for cash needs.
• USA: Cards everywhere; tipping in cash is appreciated. Our New York guide covers the trip.
• Japan: Still cash-heavy in smaller places — carry more yen. Details in our Japan cost guide.

Cash-Heavy Destinations: How Much to Take

Some places still run on cash — adjust the card/cash mix accordingly:

• Japan: Cards fine in cities; rural Japan, temples and small restaurants are cash-only. Take £150-200 in yen, top up at 7-Eleven ATMs.
• Morocco/Egypt: Cash dominant outside hotels. Take £100-150 in local currency, use ATMs for more.
• Germany: Famously card-resistant — many restaurants and shops are cash-only (nur Bargeld). Carry €100+.
• USA: Cards everywhere, but cash for tipping (valets, housekeeping, bartenders).
• Scandinavia: Nearly cashless — you could do a week without touching a note.

Research your destination’s cash culture before departure — a five-minute search saves the ATM scramble on arrival.

The Leftover Currency Question

Home with a wallet of foreign coins? Options ranked:

• Spend it at the airport on the way home — snacks, magazines, duty-free. The simplest solution.
• Keep it for next time — euros and dollars keep; exotic currencies less so.
• Donate it — airport charity boxes (UNICEF’s Change for Good) turn shrapnel into good deeds.
• Exchange it back — the worst option; you’ll lose 10-20% on the round trip. Only for large amounts.
• Prevent it: The real lesson — take less cash next time. The fee-free card means leftover currency is increasingly optional.

Quick Recap: Currency Exchange

• Best method: Fee-free debit card (Chase, Starling, Monzo) — real exchange rate, zero fees.
• Cash: Small amount pre-ordered online for cash-only situations; amount varies by destination.
• Always: Pay in local currency — decline every “pay in pounds” offer.
• ATMs: Bank ATMs only, decline the machine’s conversion rate.
• Never: Airport or hotel bureaus (10-15% skim), or your high-street bank’s travel desk.

The Takeaway

Best way to exchange currency: get a fee-free card (Chase/Starling/Monzo), spend in local currency, decline every “pay in pounds” offer, pre-order a little cash online for cash-only spots, and never touch an airport bureau. Five minutes of setup before departure, hundreds saved over a lifetime of trips. The foreign exchange industry profits from confusion — now you’re not confused.