Viva Press Release (April)
The Post Office’s Holiday Spending Report 2023 revealed that 77% of people planning to take a holiday overseas state that the price of in-resort food, drink, and sightseeing is a factor they consider when deciding where to go.
Holidaymakers budgeted an average of £338 to spend in-resort during their last overseas holiday; however, very few stuck to their budget, with 70% admitting to overspending.
Jetting off this summer and unsure how much money to put aside for extra spending? Check out TUI’s holiday spending money calculator. The tool is free to use – simply answer a few questions about your destination, board-type, and the sort of activities you’re interested in. The calculator will then use the information you’ve provided to generate a rough estimate of how much money you can expect to spend during your trip.
Dan Whittaker, a personal finance expert at Vivamoney.co.uk, explores different ways to access travel money and shares top tips for making your budget stretch this summer.
1. Compare exchange rates
‘When buying our currency in cash, many of us head to our nearest high street for ease, especially if we’re already out doing a bit of holiday shopping,’ Dan says. ‘While this may be the most convenient option, it could also be costly. Using a comparison site such as Money.co.uk to view and compare exchange rates could help to save you money. Comparing is quick and straightforward and will generate results from both high street and online bureaus. You can simply use the tool to give you an idea of different available rates, or you can go ahead and either click and collect or order your currency online.’
2. Buy before you fly
‘Research has suggested that airport exchange rates can be as much as 10 to 13% higher than rates offered by banks and high street bureaus. This could equate to a loss of at least £10 for every £100 you exchange. According to a survey carried out in 2022, holidaymakers purchasing currency from either Heathrow, Stansted, Liverpool, Leeds Bradford, East Midlands, and Birmingham airports risked an average loss of £172 when converting £1,000 into euros.’
3. Be aware of credit and debit card fees abroad
‘Many providers will charge a currency conversion fee when you use either your debit or credit card to make a transaction overseas. This is known as a ‘non-sterling transaction fee and the average charge is around 3%. In addition to this, you could also be charged a cash withdrawal fee if you use your credit card to withdraw cash from an ATM. Make sure you’re aware of any fees or costs beforehand, so you’re not hit with a nasty surprise when you check your statement back home.
‘If you’re going to use your cards abroad, remember to let your bank know where you’ll be travelling to. This can usually be done through your online banking account or app. When your bank notices that your card is being used to make transactions outside of your country of residence, they could suspect fraud and your card may be cancelled.’
4. Pay in local currency
‘If you do opt to use your debit or credit card abroad, you might want to pay in local currency where possible. When you go to complete a transaction in an establishment such as a restaurant or shop, you will usually be given the option of paying in either Great British Pounds (GBP) or the local currency. The rate of local currency payments is determined by your card network (such as Visa or Mastercard), whereas GBP payment rates are set by the merchant and may be higher. Paying in GBP could be up to 10% more expensive per transaction.’
5. Consider a travel credit card
‘One way to potentially avoid transaction fees is to use a specialist travel credit card. There are a number of these cards on the market – some do not charge any transaction fees for overseas spending, whereas others do. If you’re approved for a travel credit card, be sure to read through the terms and conditions before you accept so you know exactly what to expect when using the card abroad.
‘This option isn’t for everyone and requires careful consideration beforehand; you should only consider applying for a travel credit card if you’re confident that you’re able to manage the monthly repayments, including interest, without this affecting your essential outgoings, such as your rent or mortgage, utilities, and food. As with any credit card, you should aim to make at least the minimum repayment amount on time each month, as failing to do so could result in additional fees and charges, as well as damage to your credit score.’
6. Look into prepaid travel money cards
‘If you’re looking for an alternative to travel credit cards, you may wish to look into a prepaid travel money card, which you can get from various retailers including TUI and the Post Office. You will not be charged any fees for using these cards abroad. Travel money cards can hold multiple currencies at the same time, which might be especially ideal for those embarking on a cruise or backpacking around a variety of countries.
‘You can use your travel money card wherever you see the Mastercard or Visa logo.
These cards do not link to your bank account, which should offer you some peace of mind if your card is lost or stolen. In addition to this, because travel cards are prepaid, they do not have any impact on your credit score.’
Viva Money has shared tips for making the most of your travel money this summer.
-ENDS-
About Viva Money
Viva Money is not a lender but is a fully regulated and authorised credit broker. Viva Money is a registered Trading Name of Digitonomy Limited, Registered in England and Wales (Company number 08385135), Registered Office; Steam Mill Business Centre, Steam Mill Street, Chester, Cheshire, CH3 5AN. Digitonomy Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register under reference number: 690249. Licenced by the Information Commissioners Office, (registration number ZA007309)
Website: https://vivamoney.co.uk/
Dan Whittaker - Personal Finance Expert at Viva Money
Dan has strong market and product knowledge across a range of consumer finance products including, but not limited to, credit cards, savings, loans, and mortgages.