Anonymous left a comment on my blog a bit ago- he asked:
I am interested in becoming an exchange student in Germany myself, and I've got a question you might be able to answer.
How are you handling your money? As in, are you using traveler checks, an ATM card, a debit card...?
For anyone who's interested in becoming an exchange student, this is a good question- that's why I'm answering this in a post, and not just the comments. I'd like to apologize for waiting so long to answer this, though. Sorry Mr. Anonymous!
In any case, I opened up an ATM account in the US, and put my mother's name on it as well. This way, I can access my money from (pretty much) any ATM in Germany, and my mother can transfer money from my savings account into that account as necessary. ATM's give you good enough exchange rates, and if you have a nice bank they have low or no fees. I would recommend this option.
American credit cards won't get you far in Germany- all Germans have an EZ card. I'm not sure what it stands for, but in any case it's a little different. Expect to have to withdraw cash from ATMs and then pay with it- even for big purchases.
Nobody uses checks in Germany. Don't bring them. You'll get laughed at.
Also: Germany is really expensive. In addition to the exchange rate, food is expensive, transportation can be expensive, traveling is definitely expensive, and clothing is very very expensive. Plus, you begin to pick up costs that you may not have covered in the US- a good exercise is to keep track of everything you pay for in the US for a month (and everything your parents pay for you) and then multiply that by 1.5 or so. That's probably about right.
Anyway, save up enough money beforehand that you have more than you need, not less!