Change to dollars now or wait and see??

pebbles21

hi would appreciate some advice here ,im heading to the states on holidays at xmas and have my spending money put away but in euros so in the current climate of the euro weakeaning against the dollar should i just change over now or wait and see if it improves nearer the time

thanks in advance;)

biko

Your guess is as good as mine*

*these are uncertain times

pebbles21

biko wrote: »

Your guess is as good as mine*

*these are uncertain times

ok re phrase it then what would you do change or wait ???

kmick

How about you hedge. Buy half now and half when you are going.

lovepink_xo

ahh im wondering the same thing!!im going there in less than a month and have about 5,000+ euros that i need to convert to usd, a few weeks ago the euro was worth 1.45$, now its at 1.28

juvenal

It's quite difficult to judge as the markets are so uncertain at the moment.

In recent weeks the US dollar has strengthened quite a bit against the Euro, whereas the Canadian dollar has weakened. During the summer months, the US and Canadian currencies had parity at 1:1, now they're at 1:1.25.

On another note, I think you're positively mad to be even considering changing hard cash from Euro to Dollars. Why don't you use your credit card to purchase absolutely everything there, and then use the cash to pay off the card upon your return.

I don't understand people who change currency when going abroad, between the cash rate and the bank charges you're losing out. When you use your credit card abroad, you don't pay a charge on the transaction (unlike UK credit card holders who do), and you get the interbank foreign exchange rate. Typically this interbank rate is usually anywhere between 2% and possibly up to 7% better than rates you will get when exchanging cash or traveller's checks.

Using a credit card takes discipline, but I always use plastic wherever I go, unless I'm going to some remote country/area where I know that I'll have trouble getting credit card payments accepted, then I'll bring some small amount of cash. You're going to the US, where plastic is king. I'd strongly advise bring a small amount of cash (e.g. $200) for small tips, taxis etc., and use a credit card to pay for everything else. It will be accepted everywhere, and you'll get a superior rate of exchange than you would going into a bank and changing currencies across the counter.

One thing - Don't use your credit card to get cash from an ATM, only use it a POS (point-of-sale, such as shops/restaurants etc.) transactions, and you'll do a lot better.

lovepink_xo

juvenal wrote: »

It's quite difficult to judge as the markets are so uncertain at the moment.

In recent weeks the US dollar has strengthened quite a bit against the Euro, whereas the Canadian dollar has weakened. During the summer months, the US and Canadian currencies had parity at 1:1, now they're at 1:1.25.

On another note, I think you're positively mad to be even considering changing hard cash from Euro to Dollars. Why don't you use your credit card to purchase absolutely everything there, and then use the cash to pay off the card upon your return.

I don't understand people who change currency when going abroad, between the cash rate and the bank charges you're losing out. When you use your credit card abroad, you don't pay a charge on the transaction (like UK credit card holders do), and you get the interbank foreign exchange rate. Typically this interbank rate is usually anywhere between 2% and possibly up to 7% better than rates you will get when exchanging cash or traveller's checks.

Using a credit card takes discipline, but I always use plastic wherever I go, unless I know that I'll have trouble getting credit card payments accepted, then I'll bring some small amount of cash. You're going to the US, where plastic is king. I'd strongly advise bring a small amount of cash (e.g. $200) for small tips, taxis etc., and use a credit card to pay for everything else. It will be accepted everywhere, and you'll get a superior rate of exchange than you would going into a bank and changing currencies across the counter.

One thing - Don't use your credit card to get cash from an ATM, only use it a POS (point-of-sale, such as shops/restaurants etc.) transactions, and you'll do a lot better.

i dont know about the OP, but.... not everyone has a credit card.
im an 18 year old student and getting a credit card would be a disaster for me.
plus not everyone gets one even when applying.

juvenal

Just to give you an idea, at today's €uro/US$ exchange rate on oanda.com

€5,000 =

Interbank (wholesale) | US$6,623.95
Credit card | US$6,490.88
Cash | US$6,358.42

As you can see, there's a night out worth of cash in the difference there.:) Plus you've the added security of not carrying around over $6k in cash with you. At least with a card you'll have fraud protection and the ability to cancel it on the off chance something should happen.

lovepink xo wrote:

i dont know about the OP, but.... not everyone has a credit card.
im an 18 year old student and getting a credit card would be a disaster for me.
plus not everyone gets one even when applying.

My sister got a student MasterCard from AIB, they were practically handing them out in the university. I wish I had €5k when I was an 18 year-old student! :P

Anyway, it's just something worth considering.

ncmc

On another note, I think you're positively mad to be even considering changing hard cash from Euro to Dollars. Why don't you use your credit card to purchase absolutely everything there, and then use the cash to pay off the card upon your return.

Using a credit card takes discipline, but I always use plastic wherever I go, unless I'm going to some remote country/area where I know that I'll have trouble getting credit card payments accepted, then I'll bring some small amount of cash. You're going to the US, where plastic is king. I'd strongly advise bring a small amount of cash (e.g. $200) for small tips, taxis etc., and use a credit card to pay for everything else. It will be accepted everywhere, and you'll get a superior rate of exchange than you would going into a bank and changing currencies across the counter.

That's good advice, but only really works if you are able to clear your card when you get home, if your card has a balance before you go and you can't clear it when you get home, then you are going to pay interest on the purchases.

I would agree with the previous poster and but half now, half later. It is such a shame though, I got some dollars for 1.60 before my holiday in August, it left everything so cheap!

juvenal

ncmc wrote: »

That's good advice, but only really works if you are able to clear your card when you get home, if your card has a balance before you go and you can't clear it when you get home, then you are going to pay interest on the purchases.

I would agree with the previous poster and but half now, half later. It is such a shame though, I got some dollars for 1.60 before my holiday in August, it left everything so cheap!

I agree; as I said it takes discipline to have a credit card and for it not to cost you more than it's worth and end up in debt. Some people treat them as a licence to spend money irrationally.

Personally I don't bother with cash for the most part, but I'm careful enough that I've only carried over a balance once (and it was well worth it). If you think a credit card is something you don't think you'd be able to manage, then you should stick with hard cash. You can't spend what you don't have!

lovepink_xo

juvenal wrote: »

Just to give you an idea, at today's €uro/US$ exchange rate on oanda.com

€5,000 =

Interbank (wholesale) | US$6,623.95
Credit card | US$6,490.88
Cash | US$6,358.42
As you can see, there's a night out worth of cash in the difference there.:) Plus you've the added security of not carrying around over $6k in cash with you. At least with a card you'll have fraud protection and the ability to cancel it on the off chance something should happen.



My sister got a student MasterCard from AIB, they were practically handing them out in the university. I wish I had €5k when I was an 18 year-old student! :P

Anyway, it's just something worth considering.

hmm i suppose thats good, BUT dont think $100 is enough to make me want a credit card. i love shopping and cant control myself when i see cute things so i know i would get myself in serious debt. at least if i can only spend what i have in hand i wont buy as much.
AIB have been trying to push the student credit card on me too (i already have a student bank account with them) but i know a guy whos 28 and working a job that gets a little over minimum wage and they wouldnt give him one! (he only wanted it for holidays as he didnt feel safe carrying a lot of cash on him but he didnt mention that to him &they still denied him)

MonsterMob

juvenal wrote: »

One thing - Don't use your credit card to get cash from an ATM, only use it a POS (point-of-sale, such as shops/restaurants etc.) transactions, and you'll do a lot better.

If you put money onto your credit card and take it out that way then the charges are similar to a bank charge.

Bluetonic

MonsterMob wrote: »

If you put money onto your credit card and take it out that way then the charges are similar to a bank charge.

If it's loaded with cash and it's stolen and used illegally it can cause problems.

mike65

The euro is on a downward slide for a while I think, the macco economic numbers are all poor to bad, the ECB will be cutting rates before they raise them again.

I'd buy now.

Mike

Nunu

I've had my NY new years trip booked since March and have had all my spending money ready to change since June. Why, oh why didn't I change it inJuly/August ....I am an idiot:(

I spent last summer in NY and used Credit card for 90% of my purchases...when i got home and checked the exchange rate MBNA charged me I remember being largely dissapointed? Is the rate always better than exchanging cash over the counter? I will definitely be able to cover any money I spend on my card...so it's the best way to go yeah? @ Juvenal

Edit: Forgot to mention my bank does not put on any charge when I change my money, so that's something for me to think about when weighing up against using credit card exclusively - where there will be a charge on every transaction.

juvenal

Nunu wrote: »

I've had my NY new years trip booked since March and have had all my spending money ready to change since June. Why, oh why didn't I change it inJuly/August ....I am an idiot:(

I spent last summer in NY and used Credit card for 90% of my purchases...when i got home and checked the exchange rate MBNA charged me I remember being largely dissapointed? Is the rate always better tahn exchanging cash over the counter? I will definitely be able to cover any money I spend on my card...so it's the best way to go yeah? @ Juvenal

Like any market where it can fluctuate due to any number of forces, the currency markets will roll up and down and you can see considerable differences even in the space of a few days. It's very hard to predict, but I would agree with Mike when he says that it's probably not going to strengthen in the short to medium-term future. I just follow the economics from my armchair, but you can get a flavour of where it's going with a little research - it's the predictions that are difficult, and that's why the likes of JP McManus is mint!;)

Don't give yourself a hard time about not exchanging two months ago, you could easily have done it and the dollar might have gone to $1.80 now, and you'd still be kicking yourself.

While the credit card rate is usually favourable, some people think there will be a huge difference between it and the over-the-counter cash rate. This is not the case. It usually lies somewhere between the wholesale and the consumer's rate, so depending on your expenditure it can sometimes make several hundred dollars difference.

I would use the credit card for a variety of reasons; favourable rate; no fees (unless you get carried away and let it roll over to the following months!); security - you don't have several thousand dollars in your hotel room/on your person; and the freedom of not having to plan to take $400 shopping today, but find $600 worth of bargains that you can't get because you haven't enough cash with you.

Put your money in your current account, and pay what you owe on the card when you get home. Like any loan, your credit card is a form of lending, so wait until you have to pay it (usually the 29th or so of the following month - it will say on your paper bill). The funds are better off in your account then in the banks. And I'm not 100% sure, but it may not do your credit rating any harm either.:)

Just my €0.02

Bluetonic

juvenal wrote: »

so wait until you have to pay it (usually the 29th or so of the following month - it will say on your paper bill).

It can be any of the weeks of the month, you decide when applying for a credit card.

zeusnero

I saw a great opportunity in August when the rate hit 1.59 - bought $6500 worth of Dollars. Unfortunately (ttbomk) it's practically for an individual to get a US$ holding account in an Irish Bank....

Saw the BOI 5.26% APR account and changed $5000 back at $1.51. If i'd held on I'd now be sitting on €1006 profit (and growing by the minute). :mad: Looks like currency speculation definately has its merits...

So moral of the story - I still have $1500 bought at a rate of 1.57 to spend on a trip to the US in November

You should probably have/get a credit card anyway.

Advising it to you as an answer to your question is silly as it's going to use whatever dollar rate there is in december anyway.
Remember also that the rates you see on line are not what you will get at a bank or on your credit card.
It will be 2 cent less than that.
They have to make money too..

I got dollars yesterday for an up coming trip because I foresee the Euro sliding further as more and more EU countries declare recessions.

Theres also the U.S election.
Thats a great uncertainty.
At the moment,it's pricing up the dollar from what I can see.

Yo'll get $1.25 in a bank today and I'd take it to be honest.

On a 1000 Euro it will give you $250 dollars less than last july ( I got a rate of 1€ = $1.58 back then...yikes! so theres been an almost 30% fall already.

The dollar/Euro could easily go to parity if it wants , it has been there before a few years ago.
In fact for a while the euro was worth well less than the dollar-so it's up to you.

My advice is to buy now especially if it's december you are going in.

(This advice is given at your own risk)

penexpers

juvenal wrote: »

I don't understand people who change currency when going abroad, between the cash rate and the bank charges you're losing out. When you use your credit card abroad, you don't pay a charge on the transaction

An AIB visa card is charged 2.75% for each transaction outside of the eurozone. I assume other cards/banks attract similar rates.

robinph

Form those of you who cannot, or dont want to, get a credit card then a Visa Debit card is what you want.

unklerosco

robinph wrote: »

Form those of you who cannot, or dont want to, get a credit card then a Visa Debit card is what you want.

Just sent off my application form... Great idea

juvenal

penexpers wrote: »

An AIB visa card is charged 2.75% for each transaction outside of the eurozone. I assume other cards/banks attract similar rates.

Not on any of mine, although my main one is with another Irish bank. It doesn't surprise me that AIB charge tbh As far as I knew, Irish based banks didn't charge a foreign transaction whereas UK banks did. One Halifax manager than I worked with tried to justify the 4% charge by telling me "yeah well we don't charge you €40 a year to have it":rolleyes:

Charging cardholders a fee for transactions abroad makes a mockery of the mantra that a credit card is accepted anywhere around the world*

*except outside your home country where we'll charge you for the pleasure of using it

unklerosco

Does that mean Halifax Ireland will charge 4% on every purchase made?? Or do they work like the irish banks??

juvenal

unklerosco wrote: »

Does that mean Halifax Ireland will charge 4% on every purchase made?? Or do they work like the irish banks??

This was about 5 years ago, so I'm not sure what the situation is now.

At the time, the transaction charge was on all transactions made outside the sterling zone.

penexpers

juvenal wrote: »

Not on any of mine, although my main one is with another Irish bank. It doesn't surprise me that AIB charge tbh As far as I knew, Irish based banks didn't charge a foreign transaction whereas UK banks did. One Halifax manager than I worked with tried to justify the 4% charge by telling me "yeah well we don't charge you €40 a year to have it":rolleyes:

Charging cardholders a fee for transactions abroad makes a mockery of the mantra that a credit card is accepted anywhere around the world*

*except outside your home country where we'll charge you for the pleasure of using it

Which bank is your card with? Because as far as I can see all of them charge at least 1.75% for foreign currency transactions, which as far as I know is a Visa/Mastercard fee.

Where the UK banks differ is they might charge you on top of this fee, which Irish banks don't do.

dingding

Is there any way to get a US dollar credit card, that you could top up with Euro when the rate was good and use it for purchases in the US.

unklerosco

I guess if u knew someone in the states u possibly could... You'd prob need to do a wire transfer from ur bank here to a bank there???

All I know is I left work n the dollar was $1.24... Came home from college n its $1.28. Keep going.. PPPPLLLLLEEEEAAAAASSSSSEEEEEE!!!!!!!

dingding

I wonder is there an Irish solution, don't want to get caught with an "off shore" account by the taxman.

juvenal

Bluetonic wrote: »

It can be any of the weeks of the month, you decide when applying for a credit card.

I'm not so sure. Any bank I've ever dealt with have had a standard date for Visa payments. It may vary from bank to bank, but I wasn't aware that the individual would determine their own cut-off date.

penexpers wrote: »

Which bank is your card with? Because as far as I can see all of them charge at least 1.75% for foreign currency transactions, which as far as I know is a Visa/Mastercard fee.

Where the UK banks differ is they might charge you on top of this fee, which Irish banks don't do.

I'm with PTSB, and looking at both my online and paper VISA statement now.

I'm not charged any foreign currency transaction fee whatsoever; the breakdown on my paper statement shows the CA$ transaction value, the conversion rate on the day in question, and also the €UR charge that appears on my card. I thought perhaps the fee was built into the rate, but after some quick maths, this is not the case.

Perhaps I'm lucky, or perhaps the banks don't charge the fee if the balance is cleared before the due date. Either way, I've never been charged a fee for using my credit card anywhere for a POS transaction (maybe Ryanair or online ), and I've literally had it around the world.:)

unklerosco wrote:

I guess if u knew someone in the states u possibly could... You'd prob need to do a wire transfer from ur bank here to a bank there???

All I know is I left work n the dollar was $1.24... Came home from college n its $1.28. Keep going.. PPPPLLLLLEEEEAAAAASSSSSEEEEEE!!!!!!!

Madness! When you see the fees banks charge for a credit transfer outside the Eurozone you'd stop. The last time I sent money to a foreign account, it ended up costing me almost €50. Bit of a joke when it's really the click of a mouse button, but too many people (SWIFT for one) are making money from it.

penexpers

juvenal wrote: »

I'm with PTSB, and looking at both my online and paper VISA statement now.

I'm not charged any foreign currency transaction fee whatsoever; the breakdown on my paper statement shows the CA$ transaction value, the conversion rate on the day in question, and also the €UR charge that appears on my card. I thought perhaps the fee was built into the rate, but after some quick maths, this is not the case.

Perhaps I'm lucky, or perhaps the banks don't charge the fee if the balance is cleared before the due date. Either way, I've never been charged a fee for using my credit card anywhere for a POS transaction (maybe Ryanair or online ), and I've literally had it around the world.:)

Check again...

The amount of any Visa Card transaction (in a currency other than
Euros) will be converted at a rate of exchange determined by permanent tsb for the date when the transaction is debited to the Visa Card Account. This may not be the date on which the transaction has taken place. A commission fee of up to 1.75% of the transaction amount is included in the rate of exchange.

http://www.permanenttsb.ie/pdf/Personal_and_business_banking_charges.pdf

juvenal

Good find :-)

I saw that on the website, and the same fee on the other banks' websites, but presumed that it would be added on at the end as a separate charge. I didn't realise it was built in to the rate, but as you said, it's a card handler's charge outside of the bank's control.

Even with this fee, it's still a better rate of exchange (by a marginal amount granted) than the cash rate over the counter in the high street bank.

As far as I can remember, when I worked with the UK banks, they charged an additional fee per transaction on top of the charge from Visa/Mastercard etc. This made using the card abroad more expensive than cash, which defects the purpose IMO.

Anyway back OT, I would also change the cash now if I were not going to use a card. I can't see it improving beyond $1.30 or so before Christmas.

juvenal

juvenal wrote: »

Anyway back OT, I would also change the cash now if I were not going to use a card. I can't see it improving beyond $1.30 or so before Christmas.

Just as well I don't play the currency markets!

Since the Fed cut interest rates again yesterday, the US dollar has slumped to a 2.5 month low against the Euro, with current market rates around €1 - $1.38.

A further fall of several cents into the 1.40s is possible over the coming days.

http://www.x-rates.com/d/USD/EUR/graph120.html