Going abroad is exciting. Getting your money changed into the right currency isn’t. Nevertheless, it’s essential you have the necessary spending money available in the local currency. It’s no good turning up in Europe trying to pay with dollars. So get it sorted early and you’ll be on your way to having a seamless, enjoyable trip.
It’s surprisingly easy to get ripped off when changing money. Exchange rates vary depending on where you go (changing up your money at airports is never a great idea) and most banks will add fees if you use your card abroad. You can still get a good deal, though. Pay attention to the following five tips:
1. Get a pre-paid card
Pre-paid currency cards look just like a credit or debit card, but tend to be issued by specialist money changing companies. They allow you to preload money from your bank account onto that card, fixed at that day’s exchange rate.
Vouchercloud says prepaid currency cards are most cost effective in shops and restaurants, as some cards will charge you for withdrawing cash from ATMs, and outline the pros and cons as follows:
- Advantage: a currency card is not linked to your bank account, and is easy to replace if lost or stolen
- Disadvantage: don’t leave balance on a pre-paid card for your next holiday, as most have an inactive fee, sometimes as much as £2 a month
2. Choose the best pre-paid cards
However, not all pre-paid cards are equal. Rates and extra charges vary – so it’s important you pick the best. The prepaid Mastercard from Revolut is a good choice. It works alongside an app and gives you the rates banks give each other, which will always be far better than bureaux de change. It operates for most currencies, including euros and dollars. Other options include Monzo and FairFX euro and dollar cards. You can find out more from The Money Saving Expert.
3. Investigate your existing credit card deals
Unlike most specialist cards, some credit cards allow you to spend for free overseas. The Creation Everyday, Halifax Clarity and Santander Zero are top choices. It’s also worth finding out what your current card provider offers you for overseas travel. According to the Guardian, good credit cards are a better option if you pay the balance off at the end of the month to avoid incurring interest charges. Pre-paid cards tend make money off people when they leave cash on the card (and get charged for it). Either way, you’ve got to be quite disciplined.
4. Always pay in the local currency
A lot of hotels, shops and ATMs abroad will ask you what currency you’d like to pay in when you use your card. This is especially commonplace in Spanish tourist resorts. But if you choose your usual currency, the retailer will do the currency conversion and rates are often poor. If you’ve sorted out a good card, it’s always best to choose the local currency and let your card sort the conversion with the rates you know.
5. Make the most of your money
Create the best deals for yourself by budgeting and making your money last longer. Richel Goes has previously explained how she got by on a budget of $25 a day in Manila. “Hard as hell, but possible,” she said. If you’re on holiday elsewhere, you might want to allocate a bit more for everyday – do a bit of research and find out how much you should be paying for accommodation, travel, activities and food.
How do you change your money?
Share your top tips with us.
Disclaimer: This is a guest post.