Currency Questions ~ When & Where To Buy US Dollars ?

In the mad pre-vacation panic of packing, cancelling the milk and making sure that "Tiddles" has a caring home whilst you're away, it's often easy to forget the one thing that you will use every single day of your vacation ~ US dollars !

Many folks leave this vital element to the very last minute to arrange, whereas, with a little investigation and prudent planning you could save yourself a small fortune by shopping around in advance of your departure to Dolphin Song Villa.

Dollar exchange rates, like all globally traded currencies, tend to fluctuate on a daily basis. Unfortunately, there is no crystal ball that tells you if the rate will be higher next week than it is today (if there were, we'd all be millionaires!). But it is possible to study trends, which often give an indication of which way a currency is headed.

There are all sorts of factors that affect the dollar exchange rate, including the overall economy of the country, the price of major consumables such as oil, and a myriad of other intertwined and complex factors … but don't panic, it's not as scary as it sounds !

My advice would be to make yourself aware of the dollar exchange rate as soon as your vacation at Dolphin Song Villa is confirmed. Use this rate as the benchmark for all other currency decisions. Now, regularly check the exchange rates in newspapers, on line and on the TV news. You will quickly see how the rates fluctuate, and in some instances, be able to identify the reasons for these changes.

Whilst keeping abreast of these fluctuations, you also need to start shopping around to decide exactly where you are going to buy your currency from. There are of course banks, travel agents and Bureau De Change outlets, but increasingly there are also major high street stores offering money exchanges, as well as numerous well established on line traders.

Wherever you decide to buy, remember that the exchange rate you see offered will vary from place to place, and that the "selling" rate is not the same as the actual daily rate of the currency concerned. For example, at the time of writing this article the actual value of the US dollar against the pound sterling is $1.89 / £1.00. However, the "selling" rate if I bought US dollars would probably be closer to $1.83 / £1.00. This 6 cent difference per dollar I buy is the way that currency exchange companies make their profits.

Remember also that some companies are "commission free" (i.e. they do not charge any additional fee for the service they provide), whereas others may well have a flat rate or a percentage rate based on the amount of currency you are trading. This fee if applicable, needs to be calculated into your figures to work out which company is offering the best value.

Generally speaking, companies offering slightly higher selling rates tend to also charge a service fee as a way of clawing back the seemingly good deal they are giving you to begin with. So always check in advance if any fees or commissions are applicable to your transaction.

If you are using a credit card to purchase currency, you will most probably be charged a "cash withdrawal" fee by your credit card company, so this too should be factored into your overall cost.

Assuming that your vacation is not a last minute trip, you should have time to follow the advice above and get a feel for the way that exchange rates work. If you are planning for example on exchanging £1,000.00 sterling, don't feel that you have to do it all in one lump sum. If you feel the exchange rate is good, but don't have all your proposed spending money to hand at that time, just exchange a smaller amount. At least if the rate subsequently drops you will have achieved good value for a proportion of your spending money.

As the owner of Dolphin Song Villa, and therefore a regular visitor to the USA, I tend to purchase dollars in dribs and drabs between trips, when the exchange rate is good, rather than putting all my eggs in one basket and praying that the exchange rate will be great the day before I travel.

Sadly, there is no exact science to trading currencies, but with a little forethought and planning, great savings can be made and good value achieved when it comes time to exchange your hard earned sterling.

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