Recently, I’ve noticed many people around me asking whether exchanging Japanese yen now is worthwhile, and I’ve also been tempted myself, so I spent some time organizing various ways to exchange Taiwan dollars for yen.

Speaking of which, in recent years, the Japanese yen has really not just been “pocket money” for traveling abroad; from a hedging asset to small-scale investments, its value has actually been underestimated by many. Especially when the Taiwan dollar faces depreciation pressure, exchanging for yen can not only hedge risks but also yield quite favorable exchange gains.

At the end of last year, the Taiwan dollar to Japanese yen exchange rate was about 4.85, compared to 4.46 at the beginning of the year, nearly a 9% increase in a year. For investors, this return rate is actually quite good. However, my advice now is not to exchange all at once; it’s safer to do it in batches.

Regarding ways to exchange for yen, many people think they can only go through banks, but in fact, there are several options, with significant cost differences. The method I most often use is online currency exchange combined with airport pickup, which is both cost-effective and convenient. Taiwan Bank’s “Easy Purchase” has no handling fee, offers favorable exchange rates, and you can make a reservation a day or two before departure to pick up directly at Taoyuan Airport—no need to make extra trips.

If you’re feeling lazy or decide to exchange at the last minute, foreign currency ATMs are also a good option. They operate 24 hours, with only a 5 NT dollar cross-bank fee, deducting directly from your Taiwan dollar account without needing to open a foreign currency account first. The downside is that there are not many locations, and cash might sometimes be insufficient during peak times, so don’t wait until the last minute to go.

Traditional counter exchange is the safest, but it has the widest spread and the highest costs. I usually only consider it when I need it urgently at the airport. Online currency exchange transferring to a foreign currency account is suitable for those who frequently deal with foreign currencies and want to buy in batches to average costs, plus they can directly transfer into fixed deposits or ETFs later.

After exchanging for yen, don’t let your money sit idle. More and more people are exchanging yen now, and many banks offer attractive yen fixed deposit rates, around 1.5% to 1.8% annual interest. Alternatively, you can consider yen ETFs, like Yuanta 00675U, which tracks the yen and is suitable for dollar-cost averaging. For the more adventurous, forex trading is also an option—trading USD/JPY or EUR/JPY swing trades, but this requires some understanding of exchange rate fluctuations.

The Bank of Japan’s rate hike expectations last year were strong, and in the long run, the yen should appreciate, but short-term volatility is significant, especially when unwinding global arbitrage trades. So, I think now is a decent time to exchange yen, but be sure to do it in batches and avoid all-in.

For beginners, I recommend starting with the simplest methods like “online currency exchange plus airport pickup” or “foreign currency ATM,” and once familiar, consider more advanced investment options. This way, you can minimize travel costs and add a layer of protection during global market fluctuations.