The cost of travel: The best way to exchange money

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What is the best way to exchange money? That’s easily the question I get asked the most these days. Maybe it’s because finding deals on flights and hotels is a little easier these days but it’s more likely that people are just more aware of how exchange rates affect us.

Years ago, the Canadian dollar was on par with the U.S. dollar but now the exchange has devalued our dollars. What many people don’t realize is that the exchange rate you see on is never the rate you’ll pay. Bank, currency exchange offices and ATMs add their own markup to make a profit. In addition, most credit cards add a fee of 2.5% on top of their rates for even more profit. Despite these additional fees, there are ways to reduce your currency exchange fees.

Avoid fees completely with credit cards

Although it’s not technically cash, using a credit card with no foreign exchange fees is the cheapest way to pay for things. Not every card waives the foreign transaction fee so if you don’t have one of the following cards, you’ll be charged an extra 2.5% whenever you make a purchase in a foreign currency.

Scotiabank Passport™ Visa Infinite* Card

  • $150 annual fee
  • 30,000 Scene+ points when spending $1,000 in the first 3 months
  • 10,000 points when spending $40,000 in the first year
  • Earn 3 Scene+ points per $1 spent at Empire owned supermarkets
  • Earn 2 Scene+ points per $1 spent on eligible grocery stores, dining, entertainment, and daily transit purchases
  • Earn 1 Scene+ point per $1 spent on all other eligible purchases
  • Visa Airport Companion Program membership + 6 passes per year
  • No foreign transaction fees

The Scotiabank Passport Visa Infinite has an annual fee of $139, but you get a Priority Pass Membership and six free passes a year and a sign up bonus that’s usually worth $250 – $350 so there’s a lot of value with this card. I personally think it’s the best all-in-one travel card since it has no forex fees and you get a good earn rate. You earn Scene+ points with this card which can help you lower the cost of your travels. If you’re the type of person who doesn’t like to carry multiple credit cards, then this is the one for you.

Home Trust Preferred Visa Card

  • No annual fee
  • No foreign transaction fees
  • 1% cash back on Canadian purchases
  • Purchase protection

The Home Trust Preferred Visa is a pretty basic no-fee card since it only gives you 1% cash-back, but for some people, that’s all they’re looking for. That said, the 1% cash back only applies to purchases made in Canadian dollars. I used to use this card all the time while travelling, but I’ve switched to the Scotiabank Passport Visa Infinite since I like the additional benefits included.

Check out my post about Canadian credit cards without foreign transaction fees for an in-depth analysis of each card. If you’re looking for ways to earn points for free travel, then you’ll want to read my guide to the best travel credit cards in Canada.

One other thing about using credit cards when travelling. When given the choice, always choose to be charged in the local currency as opposed to your home currency. The reason for this is that merchants set their own rates which can be much higher than the rate Visa and MasterCard use when you pay in the local currency. This is known as dynamic currency conversion and is a common practice in many parts of the world. 

Exchange options when you need cash

Although credit cards are widely accepted around the world, there are still many merchants and countries that prefer to do business with cash. There have been multiple trips I’ve taken where I’ve ended up using cash more than credit. This wasn’t by choice, it’s just how the local economy works. Since exchanging money also comes with fees, you’ll want to consider the following to lower your costs.

Wealthsimple Cash Card

  • No annual fee
  • Up to $3,000 welcome bouns
  • 1% back in cash, stocks, or crypto on all purchases
  • 4% interest on deposited funds
  • No foreign transaction fees on purchases or ATM withdrawals
  • CDIC insurance protection

The Wealthsimple Cash Card is your solution if you need cash in any destination. This prepaid credit card doesn’t charge foreign exchange fees on ATM withdrawals or foreign transactions. That said, the ATM may charge a one-time user fee of around $3. Even when you factor that fee in, the Wealthsimple Cash Card is the cheapest way to get cash while on the go. Plus, you get $10 for free when you sign up with my referral link.


Using local ATMs is one of the cheapest way to exchange money. Generally speaking, ATMs charge the spot rate plus about 2.5% -3.5%. This extra charge is known as a foreign transaction fee and can’t be avoided (check with your debit card provider for the exact fee). Your home bank and the specific machine you’re using may also charge you a one-time fee of up to $5 so that’s something to consider with your overall costs. The best way to exchange money while minimizing costs is to simply withdraw your daily limit or use an ATM that’s a partner with your bank.

Foreign exchange offices

This gets a bit tricky since every exchange office has different rates. Foreign exchange offices found in airports and malls usually don’t have good rates. Any “no-fee” exchange office also tends to have higher rates since they need to make a commission. Despite all of this, some exchange bureaus offer competitive rates. The key is to know what the exchange rates are so you can do the math to see if the rates are fair. If the premium is 2.5% or less then you’re getting a decent rate.


This may come as a surprise but exchanging money at any of the big banks in Canada is usually not a good idea. Unless you’re getting USD, banks charge a pretty premium when exchanging money. Their overall rates really aren’t that good and often you’ll need to order the currency in advance.

For a more detailed look at the above and why travellers cheques are pretty much useless these days, check out my post about the best foreign exchange options for travellers.

When to exchange money for travel

When to exchange money is a question that’s asked by many travellers but it’s a game best not played since you’re essentially trying to time the market. The reason it’s become a bigger issue as of late is because of Brexit. Once the vote was confirmed to separate, the British Pound dropped 10% overnight. Let’s be clear, such shifts in the value of currencies are quite rare. If you were planning to travel to England soon, this worked in your favour but in general, you shouldn’t try to time the market.

If you still insist on trying to get the best rate on cash but you don’t know when to exchange money, I suggest dollar cost averaging. That means you would purchase a set amount of cash a few times leading up to your trip. So let’s say you exchanged $1000 worth of cash 3 different times at the rate you got each time was .90, .85, .95. In this example, your average cost would end up being .90. You didn’t buy at the lowest rate nor did you buy at its peak – you paid the average.

The problem with this strategy is that you’re exchanging money in advance at home where rates aren’t very good. As you’ve read, the best way to exchange money is a combination of using credit cards and local ATMs so why bother trying to time the markets?

Check out other parts of the series below

Part 1: Budgeting for a trip
Part 2How to pick a vacation destination
Part 3How to find cheap flights
Part 4: How to save money on hotels
Part 5: How to eat cheap when travelling
Part 6The best way to exchange money
Part 7: The basics of travel insurance
Part 8: Sticking to your travel budget

About Barry Choi

Barry Choi is a Toronto-based personal finance and travel expert who frequently makes media appearances. His blog Money We Have is one of Canada’s most trusted sources when it comes to money and travel. You can find him on Twitter:@barrychoi


  1. Gail Fawley on January 11, 2017 at 10:46 AM

    Zenbanx you can withdraw cash from an ATM in countries other than the 8 that you can hold balances in: the amount is given to you in the local currency and taken from your CAD balance at the prevailing exchange rate. Eg. MXN pesos are available even though they aren’t a “supported” currency.

  2. Currency exchange in Toronto on February 8, 2018 at 12:13 PM

    I always use Currency, knightsbridge and Zebanx dont have branches which makes me nervous.

    • Barry Choi on February 8, 2018 at 2:34 PM

      If you’re looking to promote your company, contact me for advertising rates.

  3. Guide For Traveling To Japan For A First-Timer – wongstah blog on July 1, 2018 at 8:17 PM

    […] what the pros at Money We Have have to say about money exchange back […]

  4. alex khan on June 8, 2019 at 6:35 AM

    Nice discussion. Nowadays im using P2P mobile apps to match with real people around me to exchange money. I can negotiate the rate before i walk thousands of steps. Choose the best peer, meet in a cafe and perform exchange. Winngie Exchange Local currency application is my best so far. need to be more global but i believe it will be soon. Donnow if there are some others. So far Winngie is brilliant. Just like another uber for exchanging money. Never use Euronet bankomats or airport offices. they are all cheaters, unfair rates or high commission rates. You can also use “Winngie” to send money abroad. Just wanted to share my experience.

    • Barry Choi on June 8, 2019 at 7:23 AM


      Interesting comment about apps, but how do you convert that money to cash?

      • alex khan on June 9, 2019 at 7:58 AM

        Hi Berry
        Its already Cash.
        you change cash with real people. Not any crypto. For ex. you arrive to airport you open the app, search for people around you who wants to sell or buy cross currencies they will appear on map, you can send message and meet anywhere proper change the money by hand. generally uber drivers around airport or gift shops or other tourist who gonna leave the city back available for that.

      • rosa on January 2, 2022 at 12:17 PM

        my question here, is….
        how do you avoid exchanging with someone who is a scammer i.e. gives you fake money, fraudulent bills???

        • Javier on April 8, 2022 at 9:37 AM

          Hehe, I knew these kind of people. Just negative to all new ideas.. How do you trust Uber to take a taxi? How do you know driver is not scammer and bring to you forest and kiss? We are not living in the wild-wild-west anymore. Airbnb, foodpanda, tool share, There are trust based P2P operations already. Are you aware yet?

    • jonathan on October 27, 2019 at 9:24 AM

      Do you know of any exchange apps for iphone? Winngie isn’t available for apple

      • Alex Khan on November 18, 2019 at 12:38 AM

        for real P2P i dont think apple has approved any. i guess they are waiting to be proven by thousands of users before they allow, just like airbnb or uber. I guess winngie Exchange or if there is another one will be available in IOS after they become popular.

  5. Mark S Collins on August 8, 2019 at 7:16 PM

    Casinos offer a good rate

  6. Brenda on September 29, 2020 at 9:56 PM

    I have the Air Canada Cibc prepaid card. Not going anywhere right now so will do a regular transfer CAD, when exchange is good I can chance currency to USD. Not sure of any fees so far

  7. Peter on January 29, 2024 at 5:56 PM

    Re your info on the Home Trust credit card. I still use it occasionally, depite their dropping the CDW coverage some years ago. However, on a recent trip to the UK, I booked a Hertz car rental through Auto Europe, a US company that I’ve used for decades and think very highly of. Both the original booking and the top-up payment at the end were in Canadian dollars and charged to my Home Trust card. Auto Europe bookings are made through Despite that, Home Trust refused to give me the 1% Cash Back. They also refuse to give Cash Back on charitable donations charged to the card. Just thought you might like to know.f

  8. LuisMitchell on May 1, 2024 at 9:21 PM

    I’m so much glad to read this article here. It looks like a nice tips so far. Carry on!

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