Singaporeans love food, property investments and travelling. There’s always a better financial decision to be made when enjoying each of these loves of our lives.
In this article, we explore our passion for travel – and being DollarsAndSense, we’ll look at how we can get the best foreign currency exchange rates to give us a bigger bang for our Singaporean bucks on our overseas trips.
Here are 5 tips for your next overseas trip.
# 1 Go To A Busy Money Changer
To get the best rates for our Singaporean dollars (SGD), we should always change money at a busy money changer. This is because with a much larger volume, these money changers don’t have to earn as wide a spread on each exchange they make.
Secondly, with larger volumes usually come more competition. This is why you can expect to see multiple money changers next to or nearby a popular money changer. What this also means is a more competitive rate. This is why the popular money changer locations at the Arcade at Raffles Place or People’s Park Complex have more than one money changers.
Conversely, going to money changers that don’t see as much volume may give you a rate that isn’t as competitive. Changing money at a money changer that is a “last resort” would also typically mean a poorer rate. These “last resort” money changers are typically those at the airports, border crossings or within an area where you don’t have much of an option such as if you’re on a cruise or remote region.
# 2 Avoid Changing Money On Weekends
This is mainly due to the fact that forex markets are closed on the weekends. This means that most foreign currency exchange service, including money changers, banks or international transfer services will use the last quote on Friday. In using this, they will usually place a small mark-up to account for any risk that the following Monday’s rate is going to hold stable.
There usually aren’t sufficient foreign currency cashflows over the weekend to induce large fluctuations in the exchange rate when Monday comes around, so it may be better to wait for the open of the markets on Monday.
# 3 Change Money In The Right Country
If we’re travelling to a country in South East Asia or developed countries such as the US, Hong Kong, Australia or the UK, bringing “just in case” money in SGD makes sense. If you don’t end up using it, we can simply bring it back home.
However, if we’re travelling to an obscure location, perhaps such as Romania, Mongolia or Chile, bringing US Dollars (USD) or Euros (EUR) may be a smarter choice. We’re not saying these places are backward or won’t change the SGD, we’re just saying that it may be a less familiar currency and demand for it may not be so high.
There are two implications for this – either we get a poor exchange rate for our SGD or the money changers in that country may not accept SGD.
Also, we should note that many money changers in Singapore do not offer the Croatian Kuna – which makes it necessary to change our money only when we get to Europe or Croatia. Taking our SGD to change into the Croatian Kuna in Germany, which is a European hub, may be feasible but taking it to Croatia to change may give us a poor rate, if the money changers there are willing to accept it.
# 4 Change Money At A Good Time Rather Than A Good Place
Most of us would book our overseas holidays months in advance, securing the best and cheapest prices on airbnb, airlines and attractions. We know that booking in advance give us a better deal.
Then, there’s really no reason to believe that changing money the day before we travel actually gives us the best deal. What we can do is monitor the rates for a period of time and change money at a good time.
Obviously, it’s not feasible to constantly monitor the exchange rates 24/7 – this is where we can use technology and services that can help us achieve this. Many online applications and services offer this convenience, including local banks and money transfer service providers such as XE or TransferWise.
After getting an alert, we can then exchange our SGD for the foreign currency for a rate we deem as a good one rather than have to wait and see what happens to the rates on the day or two before we fly off.
# 5 Change Money Via Your Multi-Currency Account (MCA)
Rather than hold the bulk of your money in cold hard cash, it may be a better idea to change some of your money via your MCA with your local banks. DBS’ MCA, UOB’s Mighty and other banks in Singapore offer this service.
Changing the bulk of your money via your MCA and a small quantity in cash at the most convenient money changer will certainly not mean the best rates for you. However, you should factor in not having to spend time, money and effort to search for and travel down to a money changer offering the best rates.
Also, you don’t need to exchange more than you need for “just in case” scenarios. If they do happen, we can simply go to our accounts online and exchange more money. Carrying less money in cash would also give us greater peace of mind.
Many places overseas accept credit card purchases and using our MCA should be just as convenient as cash and credit cards. Of course, this is also why we mentioned exchanging some money in actual cash.
We should also factor in not having to spend remnants of our foreign currencies at the airport right before leaving the country. Keeping these foreign currencies in your MCA, we can simply exchange them back into SGD, no matter how little you’re left with. This may not be feasible with a money changer if we have a few dollars’ worth of foreign currency, nor would it make sense to find a money changer with a good rate to convert it back in SGD for us actually.
This should be worth getting a marginally lower rate, and could actually turn out saving us more money.
We should note that most of the MCAs in Singapore tend to offer 11 currencies, and while they comprise major currencies, they may not be exhaustive for our travel itineraries.
Enjoy Your Holiday
While you’ve done all the legwork you could to get the best deals and plan the best trip, there are bound to be hiccups on any holiday. Take it in your stride, don’t be afraid to overspend a little as you’re on holiday.
If anything, these experiences will make you even savvier when it comes to exchanging money on your next holiday.
Change The Way You Send Money Overseas
Sending money overseas used to be a pain: high fees, large foreign currency spreads, needing to queue in line, and then wait for days before your money is remitted.
InstaRem offers a smarter, faster and more convenient way to transfer money overseas, with zero exchange rate margins and no hidden charges.
Exclusive For DollarsAndSense Readers: Use the promo code DNS20 to receive an additional SGD $20 when you make an initial transfer of at least SGD $1,000. Let us know what you think!