Robert Mitchell provided this useful information 10 years, 5 months ago:

How to save money on the exchange rate for getting cash and paying bills!

This discussion has been updated and is now located HERE. If you wish to review the older, outdated discussion, please continue below. Just keep in mind that the information below is outdated.

The best way to exchange money and pay your bills that I have found is through a USAA debit card pulling money out of a Volksbank ATM machine in branch.

Also keep this in mind if you are used to having to make multiple trips to the ATM to get over 5-600dollars our of your account. If you use USAA like I mentioned above you can call them and have your limit raised to 3000.00 USD for 24 hours then you can pull it out in one transaction.

Today I pulled out 1645 euro off my ATM card in one transaction. $2,152.67 after the exchange.

This comes out to .7641 or 1.3086. The market rate on the Euro to Dollar today (1000 hours) is .7651 or 1.3069 . Today Community bank is charging 1.3414!!! I saved 53.93 dollars today alone by not letting Community Bank pay my rent.

Essentially I am paying .0013% I dont think you can beat that one tenth of a percent

Now you go and open a Volksbank account for 1.50 Euro per month (you only need your US passport ot open the account) and deposit your utility money into this account. First you take it out of the ATM as I mentioned above. Then walk it over to the counter and deposit it into your German account. Now when your gas, electric, phone, internet, cell companies ect take your monthly bills out you no longer pay the 2-3% that you will be paying through Community bank or Service CU.

If you are paying 2800 per month in bills that comes out to $33,600per year. If you save 2.5% that comes out to $840 savings per year by eliminating the exchange rate. Now add on all of the times you hit the ATM for quick cash and you are saving more than 1000 dollars in a year.

Now the benefit on the other side to doing this is that not only are you getting charged 2-3% on debits out of your account in Euro by these on base banks. When your gas or electric company gives you your rebates at the end of the year for reconciliation you will be paying this 2-3% again! Not if you do what I laid out above. If they owe you 800 Euro at the end of the year you will get 800 Euro in your account.


One more cool thing you may or may not have noticed. If you look at your LES you will have your OHA that includes your housing allowance and your utility allowance. If you add up your allowances and convert them to the current market exchange rate you will see that every month they tack on that 2-2.5% to cover the fees that these banks are going to charge you. So with a little work you now get to put that money in your pocket.


The key things here are use your USAA ATM to get your cash out of the ATM do not let any actual bank tellers make the exchange for you because that is when the hefty percentages get added on.

USAA and Volksbank is the best combination that I have found. Using my "other" ATM card I pay the full 1% So i set up a Volksbank account and walk from the ATM inside the branch to the teller and deposit my Euro that I just paid one tenth of a percent on. Also you will not pay an ATM fee for the transaction.

I hope this helps somebody

Robert



10 years, 5 months ago

(Be sure to read my updated post here as well as more info here).

MAP of Volksbanks

I want to clarify this one more time. There was some confusion on my part. You do not need to have a USAA account to get a better exchange rate than what AAFES is offering. AAFES takes the real current exchange rate and tacks their own fees on top of it. When you withdraw Euro from an AAFES bank such as Service Credit Union or Community Bank, you are paying the extra AAFES fees as part of the AAFES exchange rate. If you take your ATM card, even from SCU or CB, and use it in a German ATM, you get the real exchange rate without AAFES' extra fee. However, USAA will refund the ATM fees, if any, as well as foreign transaction fees. I don't think SCU or CB will refund foreign transaction fees. Check with your own bank to inquire. The reason the USAA/Volksbank combo is so nice is due to the fact that there is no ATM fee involved, and there is no foreign transaction fee involved since it is refunded.

This is fantastic info, rmitchell248. Thank you!

I hate to sound like an idiot, but how does this work in reverse? You are talking about withdrawing Euro. We get paid in U.S. Dollars. This means we have to spend dollars to get Euro. Unless I am mistaken, your example speaks of spending Euro to get Dollars.

My Community Bank account has Dollars in it. So, when I go to the ATM to get Euro, I am charged the daily rate. How do I save on that.

As you can probably tell, I am not a financial wizard when it comes to currency exchanging.

Thanks.

Want to know what taking Euro out of an AAFES ATM will cost you? Here is a handy online tool for that: Exchange Calculator

10 years, 5 months ago

No problem. You get paid in US dollars but when you take your ATM card with US dollars on it and use the Volksbank ATM machine it gives you Euro.
The conversion is done from US dollars to Euro in the ATM machine transaction between Volksbank and USAA.

Essentially we set our pay to be deposited into USAA from the government, it comes in US Dollars. I take the money out of the Volksbank ATM machine in EURO. I then deposit the Euro cash that I took out of the ATM into my Volksbank account there in the branch.

I am essentially using the ATM as my currency converter. It is taking the Dollars on my ATM/Checking account and changing them to Euro Cash. It is just a numbers game its not like you actually have cash sitting somewhere its just an amount of money that you have that does not even exist anywhere other than the banks digital system.

If you pull out US Dollars cash from your American bank account and want to convert it to Euro locally you will get hosed big time. What I am talking about has to be done through the ATM machine taking money out of your checking account!

10 years, 5 months ago

Gotcha. That is how we have been doing it all along. Using Community Bank's ATM.

Your way seems to save a bit of $$, so it is worth looking into.

Thanks for the explanation.

10 years, 5 months ago

Using Community banks ATM is about the worst thing you could do. Today they will charge you 1.3414 USD per Euro. I paid 1.3086 today that is a HUGE difference. And again if you are using Community bank they are charging you the same amount on every bill you pay automatically or through a debit from the utility company like your electric, gas, water, cell phone, home phone and internet.

10 years, 5 months ago

Just called USAA. No affiliation with the military is needed in order to have a bank account with them. I am opening an account as I write this.

I am ready to give Community Bank the ol' heave ho and start saving money by not giving it away to AAFES/Community Bank.

10 years, 4 months ago

I want to report my experience.

I used Volksbank's ATM in Landstuhl to withdraw Euro. I was charged nothing in fees from either Volksbank, nor USAA. The exchange rate I received was about 3 cents higher than what AAFES was offering that day.

While 3 cents doesn't seem like a lot at first glance, it sure adds up fast when withdrawing several thousand Euro for a vacation or other expenses!

10 years, 4 months ago

I just made a withdrawal from Stadtsparkasse German bank account in euros using my Service Credit Union debt card and it also was about 3 euro cent higher in my favor than Service Credit Union's rate. However, I was charged a transaction fee. I will make a withdrawal from the local Volks Bank and see if I get charged the transaction fee.
The savings in the rate alone far outweigh the price of the transaction fee. But, a dollar saved is a dollar earned. If I can save the cost of the transaction, it will be worth it.
I will post my results.

10 years, 4 months ago

The transaction fee is from Stadtsparkasse. Volksbank has no fee.

USAA will refund $15 in fees per month. No minimum balance required. Service CU requires $1,500 minimum balance.

Grab yourself a USAA account.

Also, foreign transactions fees are based on the withdrawn amount. The more you withdraw, the higher the fee. ATM fees are flat, however.

10 years, 4 months ago

If you can direct deposit or have USAA auto transfer to Volksbank would you achieve the same results? Just curious if possible in order to save time on having to physically go into the bank or if I were to deploy to ensure seamless transition when my wife would have to take over the rental expenses. Thanks

10 years, 4 months ago

Quote by turtlenkoi:
If you can direct deposit or have USAA auto transfer to Volksbank would you achieve the same results? Just curious if possible in order to save time on having to physically go into the bank or if I were to deploy to ensure seamless transition when my wife would have to take over the rental expenses. Thanks


I would think putting your money in Volksbank would work. It's just that you would be forced to use Euro since Volksbank is not an American bank.

And, you would be forced to use Euro at the rate the day you deposit the money. That could go either way for you.

Update: You do NOT want to have your U.S. Dollars deposited into a German bank account. You will get the exchange rate offered by the German bank, and that rate usually stinks. You are much better off doing as previously described. Get Euro from the German bank's ATM and then walk that Euro into the bank for deposit.

10 years, 4 months ago

The problem with transferring your USAA money straight to Volksbank is mainly that there would be an international wire fee every time you make the transaction. This would not be refunded since it is a wire fee.

I am not sure if there really is a seamless way to do this while deployed but I will check into a few things later this week.

Unfortunately you can NOT get your pay sent straight into your German account. This is where Service and Community bank have us trapped. They have both German routing and American routing numbers so they can interface with both communities.

Quote by Razor:
I just made a withdrawal from Stadtsparkasse German bank account in euros using my Service Credit Union debt card and it also was about 3 euro cent higher in my favor than Service Credit Union's rate. However, I was charged a transaction fee. I will make a withdrawal from the local Volks Bank and see if I get charged the transaction fee.
The savings in the rate alone far outweigh the price of the transaction fee. But, a dollar saved is a dollar earned. If I can save the cost of the transaction, it will be worth it.
I will post my results.


Unfortunately with Service I had seen them tack on a fee later that did not get refunded. If it works out for you that would be great. I do know they will not refund the ATM service charge like USAA will though.

At the end of last month I got 42 USD in refunds from USAA that covered international ATM fees and international charges

10 years, 4 months ago

Quote by rmitchell248:
...At the end of last month I got 42 USD in refunds from USAA that covered international ATM fees and international charges


USAA must have changed their refund policy. I was told I could get up to $15 in ATM fee refunds per month.

Thanks for answering the questions from the other members.

Also, I am a pretty straight forward person. I love to ask questions and get straight answers. The past several times I have been to Community Bank, I have asked the tellers why the rates were so much better on the economy than in the bank on base. The answers proved to be entertaining. One teller actually told me that the exchange rates were different off base, and that there were actually two different exchange rates. One for on base, and one for off base. She told me that AAFES controls the exchange rates on base. She then went on to tell me how "The Germans" controlled the exchange rate for The Euro off base. She was close, but no cigar.

10 years, 4 months ago

I totally agree! But you can also open an account with Post Bank as well...they offer the same "lower" exchange rate. I think there are fewer around here than Volksbank, but still just as good. And also, when using a USAA debit card to pull out euro from a German ATM, they don't charge you the transaction fees... I think it's 6 times a month you can pull money out without getting charged fees.

10 years, 4 months ago

Quote by mel_c_220@yahoo.com:
I totally agree! But you can also open an account with Post Bank as well...they offer the same "lower" exchange rate. I think there are fewer around here than Volksbank, but still just as good. And also, when using a USAA debit card to pull out euro from a German ATM, they don't charge you the transaction fees... I think it's 6 times a month you can pull money out without getting charged fees.


There are probably a few banks that can be used. The Volksbank is an example, and happens to be one that both rmitchell248 and I have tested.

Where is Post Bank? The more info, the better! Thanks.

10 years, 4 months ago

Interesting info about the DoD bank rate.

INFO

Unless I am mistaken, the news release states that The DoD rate is marked up by 2.5%. The news release tries to tell us that it is OK for us to pay the extra 2.5% because they make it up to us in our COLA. Call me crazy, but why would I want to pay 2.5% more for anything? I'm sticking with the better rate that I get using my ATM card at a German bank. The DoD justification of making it up to us doesn't make their markup any better. I have no problem using an ATM instead of a DoD bank to get my Euro.

Here is the daily rate set by DoD

DFASRelease091001.pdf

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