8 tips to buy your euros at the best foreign exchange rate
If you live in Spain, you may have an ongoing need to transfer money from home to your Spanish bank account. In which case, you’ll know full-well the pitfalls of exchanging currency! Up one minute, down the next, the foreign exchange market can be a real roller coaster. Given this, how can you ensure you buy your euros at the best exchange rate? Find out, with the following 10 tips!
1. The early bird catches the worm!
This is to say, the sooner you start looking at the exchange rate, the bigger a window you’ll have for a good one to become available. After all, imagine you need to buy euros. If you wait until the last minute, you’ll have to accept whatever exchange rate is available at the time. But, if you look in advance, you can keep an eye on things, and buy your euros when a good exchange rate shows up!
2. Let Google be your guide.
So, if you want to keep an eye on the exchange rate, how do you do so? Well, it’s just a simple case of asking Google! Enter the currencies you need to exchange into the search bar (for example, “pound to euro”), and Google will return the latest rate for you, there and then. Piece of cake! Then, whenever you want to see if the exchange rate’s improved, you just type in the same query.
3. Don’t look to the stars.
In most spheres of life, we’re told to aim as high as we can. Unfortunately, that’s not the case with foreign exchange. This is because, if you aim too high with your preferred exchange rate, it may be unrealistic, and never arrive! For instance, you may wish to exchange pounds for euros at 1.30. However, sterling hasn’t been this strong against the euro since 2008, meaning it’s unlikely to come up!
4. Seek a word from the wise.
If you’re unsure what a realistic exchange rate is, take a hint from those in the know. If you ask a currency dealer, they’ll be able to tell what’s happening to the euro exchange rate now, as well as where it’s been in the recent past. So, this will give you a much better idea of what exchange rate is reasonable, meaning you don’t have to wait around ’til kingdom come before you buy your euros!
5. Don’t get greedy!
Of course, what may happen is that your target exchange rate arrives, but you decide to hold off, to see how high it goes. If this is your instinct, I’d advise you to think again! This is because the foreign exchange market is a treacherous beasty, meaning an exchange rate that’s climbing one minute can be way down the next. Given this, once a good exchange rate turns up, take it!
6. Get chatty.
If you’re exchanging a large amount, it’s obviously crucial that you feel comfortable with the currency dealer you’re using. With this in mind, talk to them a bit before you decide if you want to use them. Find out if they sound like they know what you’re talking about and, most importantly, if you trust them. If not, it could be worth talking to a currency dealer you do trust.
7. Hold onto your wallet.
This is another way of saying, look out for currency brokers that charge fees and commission! Simply put, you shouldn’t have to pay it, and if you’re talking to someone that says they charge fees, then look elsewhere. There are plenty of foreign exchange dealers out there who don’t demand anything in extra costs. (If you’re unsure if they charge fees, then check their website or ask.)
8. Don’t accept the first offer.
One currency broker can offer you a much better exchange rate than another. For this reason, don’t accept the first offer you receive. Instead, shop around, especially between banks and currency dealers! You may find you can save up to 4% using a specialist instead of a bank which, on a large transfer, will add thousands to your final euro total. Not bad for just a few phone calls, eh?
About the writer
Peter Lavelle is a currency dealer at specialist foreign exchange broker Pure FX. To find out when the best euro exchange rate becomes available, sign-up to our free newsletter. We’ll tell you when the exchange rate hits a record high.