Travel money: five tips for your summer holidays
Avoid wasting money on rip-off exchange rates, credit card fees and mobile roaming charges
If you are heading abroad for your holidays this summer make sure your travel money stretches as far as possible with these travel money tips.
Buy your travel money in advance
If you leave it to the last minute and buy your foreign currency at the airport you will get an incredibly poor deal. Airport currency bureaux offer very bad exchange rates as they know at that stage you have no choice but to use them.
Don't get conned, if there is still time ahead of your holiday then use a comparison site to find out who is offering the best exchange rate. This can make a huge difference to how much holiday money you have. When I compared the rates for changing £1,000 into euros there was a €70 difference between the best and worst.
If you have left it to the last minute then order your currency online from the airport bureau de change. You can then collect it when you are there. You'll get a much better rate for having ordered it in advance – even if only the night before.
Pack the best plastic
Anyone planning to pay for things with a credit card while they are on holiday should take the time to make sure they have the best possible card with them. Every time you use your card you could pay a foreign exchange fee of around 2.75 per cent.
That means that if you used your credit card twice a day for amounts of £50 for a two-week holiday you would pay almost £40 in fees over the course of your trip.
Avoid this by getting a card that doesn't levy a foreign exchange fee. One of the best is the Halifax Clarity Mastercard. Not only is it fee-free for foreign purchases but Mastercard also tend to offer a slightly better exchange rate than Visa.
Pay in the local currency
Sometimes when you are paying on a card abroad the retailer will ask you if you want to pay in the local currency or pounds sterling. While it can be tempting to opt for sterling so you can see exactly how much you've spent you'll end up spending a whole lot more.
Normally when you spend abroad your bank or card provider will do the currency exchange for you. Typically they will use the Mastercard or Visa exchange rate – which is as close to the actual exchange rate as you can get. If you opt to have the currency switched into sterling at the point of sale it is the retailer's bank that will exchange it, usually with a poor rate so they make a profit.
Tell your bank you are going abroad
If you are going to be making cash withdrawals and using your cards abroad it is worth telling your bank where you are going. Unexpected foreign spending often triggers a fraud alert and can lead to your cards and accounts being frozen. One quick phone call before you go can avoid the headache.
Buy a local Sim card
The cost of using your mobile phone abroad may be falling but it is still far from cheap, particularly if you want to use a smartphone to check your emails or surf the web. Many providers will charge several pounds a day for you to access the internet.
Avoid expensive charges by buying a local Sim card for the country you will be holidaying in. Not only does this mean you'll avoid roaming charges, you also won't have to pay to receive calls. Just make sure your phone is unlocked so it will work with a different Sim provider.