On the eve of the May holidays, the ruble went down again - those travelers who did not postpone their holidays abroad in currency had to change money at a less favorable rate. A bank employee talks about how he plans his spending in foreign currency and what needs to be done so as not to overpay when traveling abroad.
Head of the Department for Development of Relations with Secured Clients and Non-Credit Products of Raiffeisenbank
We live in economic conditions where it is impossible to count on the stability of exchange rates. If in everyday life we may not feel the influence of fluctuations in rates, then on vacation this becomes a more serious nuisance. Most of those who like to travel to other countries have at least once had such a case when, on the eve of their vacation, the dollar and the euro jumped in price and the travel budget unexpectedly increased. Sometimes significantly - by 20-40%. Not very nice when this happens. It is not in our power to influence exchange rates, but it is possible to minimize the risk of rising vacation costs that you have long dreamed about. There are several basic rules that I follow in order to organize my finances and less depend on currency fluctuations.
Do not delay the purchase of currency
I never put off buying a currency until the day before departure. Personally, I have savings in the currency that I use on trips. But for those who do not yet have savings, and those who prefer to keep reserve funds on deposit, I recommend buying euros and dollars for travel in small parts from each salary.
For example, you are planning a vacation in Greece in six months. On a trip you want to bring 1,200 euros for pocket expenses. What will the course be like in six months? Even macroanalysts are unlikely to be able to give an exact answer. But if you buy 200 euros each month, then the average price you pay will be optimal. Previously, when buying a currency required going to the bank, of course, it was not very convenient. Now the operation can be carried out in an online bank in a couple of clicks, so the process is greatly simplified. In addition, online usually offer a more profitable course than in the departments. This is also worth keeping in mind.
Transfer money to a currency card
Pay abroad for purchases that are expensive on the scale of your budget only with currency cards. Once, on a short business trip in Europe, I had to pay for gifts for my family with a ruble card. It so happened that a day after the purchase there was a jump in currencies, and as a result, the amount charged was 20% more than I expected. Of course, for relatives it is not a pity and the amount was not so significant, but unpleasant when the costs come as a surprise.
Why is this happening? When making payments abroad on a ruble card, settlements are not made daily. At the time of payment, the amount is blocked on the account, but the final debiting occurs on average two days later at the rate that is relevant at the time of debiting. If there has been a jump in the exchange rate these days, then the costs will be more than you expected. It does not depend on the bank in which you have an account. This is the process of interaction between banks and payment systems. To avoid such surprises, it is better to pay with foreign currency cards abroad. In Europe - Euro, in the USA - dollar.
Use cards for free
For example, I have payment cards and insurance for traveling abroad for all family members free of charge as part of a package of banking services - I comply with the terms of the account balance or the amount of monthly transactions and do not pay a commission. Of course, I’m a client of the bank in which I work, but I’m sure that if you carefully study the market, you can easily find similar opportunities with our competitors.
Choose your local currency when paying with a card
This advice is relevant for those who have traveled to a country with a different currency with a dollar or euro card. Sometimes when conducting an operation in stores, the terminal, seeing that the card is a Russian bank, offers a choice of local currency or rubles. You should always choose only the local currency. Otherwise, you can overpay up to 10% due to double (or even triple) conversion, commission of banks and seller.
According to the rules, the seller must allow the customer to make a decision, but somehow in one small store in Asia I had a case when the cashier chose the rubles himself, the extra 3% of the purchase amount was debited, so I recommend that you be careful.
Do not be lazy to save miles
Miles can be accumulated both on airline loyalty cards and on bank cards. Besides the fact that it is an opportunity to save on a ticket (always relevant, regardless of the dollar and euro rates), it is also a good option to buy a ticket at the time of peak currency prices - miles are not so sensitive to currency fluctuations - prices do not change so promptly.