Living in Singapore, with an airport as efficient as the Singapore Changi Airport, puts us in a great position to travel frequently. And there’s nothing quite like the excitement of having an overseas trip to look forward to.
But once flights, accommodation and travel insurance are booked, it’s easy to overlook the more mundane logistics of travelling. One area that often gets neglected is how we actually manage our money overseas.
Whether you’re paying in cash or using a multi-currency card, exchange rates can quietly make or break your travel budget. The difference between a competitive rate and a poor one can easily add up to hundreds of dollars over the course of a week-long family holiday.
So before you swipe your card or walk up to a money changer, it’s worth understanding where travellers commonly go wrong when it comes to cross-border spending.
Here are five common exchange rate mistakes Singaporeans make when planning their overseas trips, and how you can avoid them.
#1 Exchanging Money On The Weekend
If you’ve ever tried to change money on a Saturday or Sunday, you may have noticed that the exchange rate feels mysteriously worse. That’s largely due to how financial markets operate.
Global currency markets are closed over the weekend, which means money changers don’t have access to live interbank rates to guide their pricing. To protect themselves against potential price movements when markets reopen on Monday, they typically widen the spread between their “buy” and “sell” rates. The result? A less favourable exchange rate for consumers.
Put simply, this wider spread acts as a buffer against risk, and that cost is passed on to you if you were to change for foreign currencies, or pay in foreign currencies, over the weekend.
Ironically, weekends often see longer queues at money changers simply because that’s when most people have time to prepare for their trips.
The same principle applies to multi-currency apps that allow you to exchange foreign currency digitally. Many platforms either freeze rates or widen their spreads over the weekend, which naturally results in lower rates.
So what should you do instead? The solution is straightforward. Try to exchange cash or convert currencies on weekdays. If you’re using a digital wallet like Revolut, Wise or YouTrip, it’s best to lock in your foreign currency before Friday evening (Singapore time).
#2 Assuming You’ll Always Get A Better Rate In Singapore
Many travellers assume that changing money in Singapore automatically means getting the best exchange rate. After all, we have well-known money changers clustered around places like The Arcade, which has long been associated with competitive rates.
But that assumption doesn’t always hold.
While Singapore’s money changers are generally efficient and transparent, exchange rates are still influenced by local demand and supply in your destination country.
In cities with strong inbound tourism, such as Bangkok or Tokyo, local money changers may offer better rates on currencies like the US dollar, the euro, and even the Singapore dollar. This is because they tend to have an ample supply. A well-known example is SuperRich Orange, which often quotes very competitive rates for commonly used currencies.
On the other hand, in destinations that see fewer foreign tourists, such as parts of Eastern Europe or South America, you may find that exchange rates are less favourable, or that certain currencies are not readily available at all.
The key takeaway is that the best place to exchange money depends on where you’re going. It’s worth doing a quick Google or ChatGPT search to see if there are reputable, competitive money changers at your destination.
From there, compare their rates with those offered at The Arcade or other money changers in Singapore, and decide whether the difference is worth the effort.
Read Also: Guide To Getting The Best Foreign Exchange Rates At The Money Changers In Singapore
#3 Relying Entirely On Credit Cards Or Multi-Currency Cards
Of course, when you’re overseas, one of the easiest ways to pay is to tap your card for everything. Credit cards and multi-currency wallets have made travelling more convenient than ever, but they can give you a false sense of security when it comes to exchange rates and fees.
Many credit cards in Singapore charge a foreign-currency transaction fee of 2.5% to 3.5%, on top of the spot exchange rate.
Even if the Mastercard or Visa rate looks fair, that extra charge can add up quickly over the course of your trip. If you do use a credit card, you should at least be getting 4 miles per dollar of overseas spend as a reward.
Meanwhile, multi-currency cards like Revolut, Wise, or YouTrip can be great alternatives, since they often use mid-market exchange rates and have lower fees. But these apps also have downsides; some charge for weekend conversions, and others impose monthly limits on free exchanges.
That’s why it’s risky to rely on a single method. The best approach is a mix: have some local cash on hand for smaller merchants who don’t take cards, and then use your multi-currency and credit cards for daily spending or bigger outlays that require deposits (like hotels).
#4 Opting To Pay In SGD When Given A Choice
At many restaurants and shops, you’ll often be asked a seemingly harmless question: “Would you like to pay in Singapore dollars or the local currency?”
Many travellers instinctively choose SGD because it feels more familiar — you know exactly how much you’re paying in your own currency. Unfortunately, this is one of the most common (and costly) mistakes you can make when spending overseas.
When you choose to pay in SGD, the merchant or their payment processor applies Dynamic Currency Conversion (DCC). The exchange rate used is almost always significantly worse than the rate your card issuer would have applied if you had paid in the local currency.
To make matters worse, some banks still charge their usual foreign-currency transaction fee even though the payment is processed in SGD. In effect, you get hit twice, a poor exchange rate and an additional cost.
The rule of thumb is simple: always pay in the local currency, and never in SGD, when given the option overseas.
#5 Forgetting That Rates Can Fluctuate Between Booking And Travel
Finally, one less obvious mistake travellers make is forgetting that exchange rates can shift meaningfully between the time a trip is booked and the time they actually travel.
If you’re paying for hotels, local tours or Airbnb stays denominated in a foreign currency, the total cost in Singapore dollars can rise or fall purely due to currency movements.
A good example is the Japanese yen, which has been particularly volatile in recent years. A hotel priced at ¥50,000 per night might cost around S$450 at one point, and S$420 just a few weeks later, simply because the yen has weakened.
If you’ve made early bookings without prepayment, your final bill will depend on the exchange rate applied by your card issuer on the day the charge is processed, which may differ significantly from what you initially expected.
The simplest way to manage this risk is to plan ahead. If you know you’ll need to pay a large amount in a foreign currency later, consider converting part of that amount early using a multi-currency wallet when the rate looks favourable.
No one can predict currency movements perfectly. But by doing this, you reduce the impact of sudden swings and gain better visibility and control over your actual travel costs.
Photo Credit: iStock/chuanchai
