Organising holiday money is something of an after-thought for many of us, while others sort out spending money weeks in advance. But either way, you could well be paying too much to get hold of your cash. Help is at hand, however, with these top tips for side-stepping or at least reducing transaction fees.
- Consider a specialist credit card that does not add a percentage-based fee on to currency exchange rates. While these cards can slash your ATM fees, you should make sure you pay any funds back in full each month, thereby side-stepping high interest charges. Set up a Direct Debit to ensure this happens. Card issuers really want you to use the card in the UK where bigger ATM fees are levied – so don’t!
- Beware debit cards: relying on your debit card while abroad is lazy and could cost you a great deal! High withdrawal fees, load fees, minimum charges and spending penalties all add up. Some cards are much worse than others, so check your card’s fees before you even think about using it overseas.
- Consider getting a pre-paid credit card. These cards give you all the power of a real credit card but offer complete control over your cash – since it is all yours. Lower ATM fees are another plus point. In addition, you only need to load the amount you require from your current account, protecting your main funds from card-cloning/fraud. If you have a poor credit rating a pre-paid card could be ideal.
- Euros for debit cards, pounds for specialist cards! Holidaying on the European mainland? When using your card in a shop, if you’re asked whether you want to pay in pounds or euros, always choose euros. Opting for pounds will trigger a bad exchange rate. However, a specialist credit card will offer a great exchange rate for GBP, so if you have one, say ‘pounds’!
- Take note of ATM fees. These can vary from bank to bank, so it’s a good idea to find out which is cheapest. Some ATM networks are free, so research your destination country before you set off. For example, the Bank of Canadia in Cambodia offers free withdrawals.
- Give foreign exchange offices a wide berth. These offer poor exchange rates, especially in airports. If you must use their services, you may get a better rate if you order in advance.
- Buying cash with a card? Avoid using your credit card – your issuer will charge a fee. In this case, your debit card is the way to go, since such fees are prohibited with this card type.