The pound has been volatile this week, which is really frustrating for people looking to buy travel money before they can head abroad.
We spoke to Editor in Chief of money.co.uk, Hannah Maundrell, who gave us her top tips on how to get the best exchange rate if you are going for a holiday anytime soon.
Maundrell says: “It’s so important to make sure that you are getting the most out of your money and comparing rates to see where you can get the best deal. Simple tricks will boost the spending power of your sterling abroad and if you’re not exchanging massive amounts that could offset any short-term dip in rates.”
The ten points to note are:
- Avoid buying cash at the airport: Don’t buy cash at the airport as you’ll always be able to beat it with a bit of forward planning. The same logic applies to purchasing cash from your travel company.
- Compare in advance: Compare travel money companies online but don’t just focus on exchange rates. Factor in delivery costs and choose the option that gives you the most money to spend on holiday. If you’ve left it until the last minute, order online for airport collection so that you get the best of both worlds.
- Decide how to pay: Don’t pay for travel money with a credit card as it’s likely you’ll be charged a cash withdrawal fee which adds to the cost.
- Can you lock in a rate? Top up a prepaid card to lock in your rate now. Choose your card and read the T&Cs carefully as some apply hefty fees.
- Check your T&Cs: Prepaid cards can’t always be used for hotel reservations or pay at pump fuel so make sure you have a backup option.
- Check for fees: Your regular credit card may sting you with fees abroad and your debit card is likely to be far worse. Get a credit card that doesn’t charge transaction fees abroad and pay off your statement when you get home for super cheap spending.
- Get protection: As a bonus, if you buy something that costs over £100 while you’re on holiday you could get Section 75 credit card protection too.
- Be careful with cash: Taking cash out on your credit card can leave a footprint on your credit score but keeping withdrawals to a minimum is something to bear in mind if you are planning to apply for other borrowings (like a mortgage) anytime in future.
- Do your research: Double check whether American Express is accepted where you’re heading so you don’t find yourself caught short.
- Which currency should you choose? Always choose to pay in the local currency rather than sterling if you’re given the choice as this will help you avoid sneaky exchange fees.