Considering my new year’s resolution this year was to see more of Europe, you can bet your bottom (and yet high-ranking) dollar I’m po-faced about our year-on-year 13.7% slump against the Euro. Luckily for me, the guys at Caxton, an international payments company that undercuts traditional providers by simply being better at customer service, have put together a couple of tips for saving while abroad. Hope you find it as useful as I did!
Careful planning is a must for British holidaymakers. Let’s be honest: it’s been a brutal 12 months. The cost of a summer getaway costs at least 10% more than it did a year ago. With ongoing risks to the pound, such as political uncertainty and Brexit negotiations, the pound could weaken further still – or, if there’s a softer Brexit, it could rise back up.
We’ve been working hard to help our clients protect the value of their hard-earned pounds by avoiding fees and giving them a great exchange rate. Here are five ways to be cash-savvy when travelling from the UK to Europe in 2017.
Prepaid cards are a great way to get the most out of your holiday money. Not only do they tend to offer great exchange rates and few, if any, charges when spending abroad, they also allow holiday makers to pre-load exactly how much they want to spend, meaning you are less likely to blow your budget. The Caxton prepaid card does not charge you for using ATMs abroad, which could save you an average of £3 per cash withdrawal compared to your debit card.
Always avoid airport bureaus for exchanging money since you are bound to get stung. The bureaus have captive markets in the airport, leaving them free to offer travellers terrible rates coupled with high commission. Make sure you plan ahead to avoid this. Even if the rate is just 2% higher, this could lose you as much as £40 on the average family’s holiday spending budget.
Brushing up on how currency markets work will help you to make informed decisions and understand what makes a good exchange rate for your holiday currency. It may also be worth keeping an eye on big economic events, since they can significantly influence the strength of a currency. Keep up to date with current affairs and check the news headlines – if you see reports of the pound strengthening, it’s probably worth booking some holiday money!
Consider playing it safe: you can hedge your bets by exchanging half your currency now, half later. This can be done easily by locking in a rate on a Caxton Pre-Paid Currency Card. That way, whether the rate goes in your favour or against you, you’ll benefit from the higher exchange rate on at least half of your spending money.
If you are using a debit, credit or pre-paid card when travelling abroad, always be sure to pay in the local currency if you are given the choice. People mistakenly believe that they should opt to pay in pounds. However, by paying in Sterling the money will actually be converted twice, resulting in extra charges. In some cases this could be as much as £6 per transaction, which quickly adds up over the course of a holiday.