Whether you travel abroad, in regards to cash withdrawals: the ATM knows the card is from your home country, so it brings up dynamic currency conversion (which is the ATM’s own quoted rate), giving you the option to choose that or continue without it (leaving that up to your home bank instead). For example: you decide to withdraw 300€ from the ATM but the machine’s exchange is 300€ = $410 (which is a rip off).
But, if one continues to not use DCC: the bank does the conversion from their end, in this case it comes out as $358 including a $5 transaction fee (more like $353). The same applies to contactless payments, as at some establishments, the reader will give you a choice between local currency or the one from your home country, do you pick the one that’s already converted or pay in local currency leaving it up to the bank?
Don’t use a bank that charges $5 for currency conversion. If it’s anything more than an additional 1% it’s a shit bank. Always charge things in the local currency and let your bank do the conversion for +1%. Need cash? Hit a real bank ATM (not a shady kiosk one) with a debit card that refunds ATM fees and withdraw local currency for +1%. Currency conversion any other way is a complete ripoff, aside from ordering money from the bank before you leave.
But wait is that a flat $5 fee for any amount? That can quickly outcompete 1%…
How often are you spending >$500 vs <$500 on a single transaction in a foreign currency?
Yeah that’s a good point.