7 top tips for making your money go further on your summer break.
By Kate Duggan
- Find the best exchange rate
Compare exchange rates in seconds on moneysavingexpert.com. At the time of writing, TravelFX is offering €1,150 for £1,000, which is €20 more than some other providers. If you buy currency at the airport without pre-ordering, you could seriously lose out.
Loyalty schemes such as Tesco Clubcard and Nectar offer exclusive exchange rates for members but they still tend to be lower than the best buys.
- Sidestep high bank fees
Most banks charge a 2-3% fee to use your debit card abroad. Some even charge an additional £0.50-£1.50 for every transaction.
Your bank may offer the option of taking out a multi-currency card before you travel, which can keep costs down. However, it’s often better just to apply for an additional account with one of the digital-only banks. My main account is with a high-street bank, but I also have a Starling Bank account, which doesn’t charge fees for spending abroad or withdrawing money. I transfer my holiday spending money to it before I travel.
Alternatively, you could apply for a Currensea card, which links to your existing bank account but typically has far lower fees. It also had the best exchange rates I could find.
Another option is a travel money card. You transfer money to this before you go and can top it up while you’re away. Usually, there isn’t a fee to use it abroad, but there may be one to add money. Before choosing a card, compare fees and the exchange rate being offered.
- Avoid credit card fees
If you’re hiring a car, you may have to pay with your credit card. Most providers will charge you for using your card abroad, so consider taking out a new one before you go. Which? recommendations for overseas spending include the Halifax Clarity and the Barclaycard Rewards credit cards, neither of which charges fees on use abroad. The APR for both is quite high though, so make sure you pay the bill off in full when you get home.
- Don’t buy foreign currency on a credit card
While it’s tempting to use your credit card to top up a pre-payment travel card or to buy cash in another currency, the transaction is likely to be counted as a cash withdrawal. This can incur a hefty fee.
- Make sure your cash is covered
Travel insurance is essential for unexpected expenses like emergency medical treatment. However, there’s usually a limit to how much cash it will cover. And, if the insurance provider decides the money was lost or stolen due to your negligence, you may not get anything. So, check your policy wording carefully and consider limiting the amount of cash you take with you.
- Check your phone plan…
… and then check it again. Many phone plans have a data roaming package that allows you to use your phone while abroad. However, you’ll need to make sure the country you’re visiting is on the list. For example, Switzerland isn’t included in EU-only plans.
If your phone plan doesn’t include data roaming, ensure you order the right pass as an add-on before you travel. Otherwise, you could end up with no coverage or an astronomically high bill.
You’ll also want to be very careful using your phone while travelling to your destination. Ferries, for example, have their own maritime mobile networks, which aren’t covered by your usual phone package. I had a nasty shock last year when I was charged more than £70 for using my phone on the ferry between Scotland and Northern Ireland.
- Pay in the local currency
Finally, you’ve reached your destination and are ready for that first sweet sip of margarita. If you’re paying with your debit or credit card, you may be offered the chance to pay in sterling. But it’s almost always better to pay in the local currency to ensure you get the best exchange rate. Who wants to pay more for their margarita than they have to?
