Mum, told you I'd be a billionaire one day!

When I first started traveling and needed to exchange my money, I was clueless on the calculations (despite having taken a class in finance, FML). I resorted to going to the nearest money changer to get it done, regardless of how bad the rates were. It wasn't long before I realized that different money changers offer very different rates and if you do your homework right, you can save up to a whooping RM100 or more.

Confused on how to calculate rates at money changers? Here's a simple guide:

We Buy
We Sell
US Dollar
Japanese Yen

There are only four columns that you need to pay attention to in any money changer counter, as shown above. The base currency that you will be using to buy a foreign currency must be that of the country that you are currently in, i.e. if you are in Malaysia, you can only buy a foreign currency using the Malaysian Ringgit. If you were to exchange your money in Singapore, then the base currency will be Singapore dollars.

The table above is something that you'd see in a money changer in Malaysia. Based on the table, a few information can be derived:
  • RM3.715 is needed to exchange with 1 USD
  • RM32.50 is needed to exchange with 1000 Japanese Yen

To buy, look at the "We Sell" rate.
To sell, look at the "We Buy" rate.

Use the following formulas to count:

Amount of foreign currency you get when you buy using RM:

So based on the formula, if you want to exchange RM10,000 to USD, you will get:

= US$2,691.79

(If it is Japanese Yen, the unit will be 1000)

It's that simple! Keep this simple formula in mind and you can easily compare the amount of foreign currency that you will get so you don't have to lose out even a little!

Rule of thumb:

When buying foreign currencies - The higher the "We Sell" rate, the less money you will get in return. So when comparing the rates at money changers, always be on the lookout for the lowest "We Sell" rate possible!

Happy counting!