Making Some Sense Out of Foreign Currency : Best advice is to learn the exchange systems before you leave home, and carry most of your money in traveler’s checks.

It’s easy to make mistakes when dealing with foreign currency and an unfamiliar exchange system. I learned the hard way.

Five of us picked up our baggage at Copenhagen’s airport and got into a nearby line to exchange some money. Cash in hand, we were shocked when we looked at our receipts. Each person exchanged about $25 and was charged a $5 service fee. If we had pooled our money and sent one person to the counter, we would have saved $20 altogether.

Make an effort to find out how to handle your money in a foreign country before you leave home and you’ll be in a better position to stretch your dollars.

When estimating how much money you’ll need, talk to others who have traveled in a similar style. Student travel services and youth hostel associations may be able to help you make contacts. After determining what you will need for daily expenses, multiply it by the number of days you’ll be away and add 20%.

Try to carry about 70% of your funds in traveler’s checks, which can be replaced if lost or stolen.

If possible, avoid exchanging money or cashing traveler’s checks at hotels or restaurants, where the rates are usually quite poor. A bank or an office of the company whose checks you carry usually offer the best rates.

If you just need a small amount of foreign cash, you will usually find it cheaper to use an international credit card, such as Visa or MasterCard, at a foreign bank machine. Recently, in Britain, I found that the service charge was half what I would have paid to exchange dollars at a bank. The drawback is that the credit card’s service charge takes effect the day you withdraw the cash.

Carry your money, traveler’s checks and other valuable documents in a pouch under your clothing. If those items are not easy to reach, chances are that a thief will pick a more vulnerable victim.

Spend your coins before you leave a country; currency exchange offices only deal in bills.