Getting the best foreign exchange rates is not as easy as you might think, even if you do contact your bank or a local money exchange facility. Just a few cents difference in the exchange rate can make a big financial difference, especially if you are changing a lot of currency and it is easy to ask yourself if you are really getting the best rate.
The best way to ensure that you are getting the best currency exchange rate is to ask or call around, research and generally compare rates. If the rate of exchange is high, meaning that you are going to lose money in the transaction, you can always postpone the currency exchange until rates change favorably. Rates can change daily and it may pay you to keep an eye on them, and an exchange rate calculator can be a useful thing.
The following tips can help you to benefit from the best exchange rates for foreign currency: Just about any bank, or bank's website will post the current interbank rate of exchange, and you should first obtain these.
When you need money exchanged, compare the interbank exchange rate with the rate that you get using an exchange rate calculator. There should be little or no difference, although you should choose the relevant foreign currency exchange rate.
Get exchange rate quotes from several money changers, using the above as a point of reference. However, foreign currency exchange dealers will almost certainly not give the same rate as the banks, as the bank rates are for million dollar wholesale transactions. Money changer and foreign currency exchange rates are usually for retail transactions. Keep in mind that most money changers are in business to make a profit, so they are almost certainly going to adjust the rate in their favor to cover operating expenses, as well as ensure a profit. The interbank rate should best be used for reference only, althoough as a rule of thumb, the difference between the bank's rate and the money changer's rate should be between five and ten percent.
If you are making currency transactions online, only use a bank, although there are reputable money changers and you should ensure you are dealing with a well known and reputable company. Friends or family may be able to recommend a company to use, or you can often find user reviews and a track record online. The cash transfer procedure should be guaranteed, regardless of which company you use.
It also pays to compare present currency exchange rates to those in the past, and this can give you some idea of what to expect in the future. If rates are high and you do not need the money immediately, the best strategy is probably to wait for a better rate of exchange.