How to make the most of your travelling money
There’s no doubt that the coronavirus has taken a huge socio-economic toll across the globe, with industries such as international aviation and the travel and leisure market particularly adversely affected.
However, there are signs that this trend may be reversed in the near-term, with Chile set to reopen its borders in December and the Southeast Asian nation of Vietnam also primed to kickstart its ailing tourism sector.
In this post, we’ll ask how you can make the most of your travelling money when planning your next trip overseas (and we’re sure it will be a good one!).
- Learn About Exchange Rates
Typically, it’s cheaper to buy international currency before you travel, as this enables you to complete the transaction at the optimal rate (so long as you avoid transacting at the airport!).
On a fundamental level, this means that you should consider learning about the exchange rates that exist within different currency pairings, which constantly fluctuate and can be tracked in real-time through online brokerage sites that allow for currency trading.
Of course, the most coverage is afforded to major currency pairings, including the GBP/Euro, USD/GBP and JPY/USD. So, if you’re travelling to countries such as Japan, the US or any location within the Eurozone from the UK, it should be relatively easy to monitor price movements and access analysis which forecasts future market shifts.
Economic calendars also highlight trends that can impact on currency valuations, so you should review this type of tool before completing a transaction.
- Should You Use Credit, Prepaid or Debit Cards?
If you don’t want to withdraw or exchange cash, another option is to use a credit card. However, the key is to utilise specialise travel credit cards, which typically don’t add sterling exchange fees and afford you near-perfect rates when spending overseas.
Some cards (such as the Barclaycard Rewards card) even manage to avoid charging overseas cash withdrawals, creating far greater flexibility in terms of you access and spend your travel budget.
Additionally, specialist credit cards that have been designed for the purpose of travel also afford you Section 75 protection, which ensures that vendors are jointly liable with the creditor in question in instances where you need to return or reverse a purchase.
Prepaid cards may also be of value to travellers, although they afford minimal flexibility in terms of the amount of cash you can spend. As a general rule, you should avoid using standard or domestic debit cards overseas, as they’re typically open to variable charges for both online purchases and cash withdrawals.
- Is Your Domestic Currency Accepted Abroad?
If you’re a Brit or a US citizen travelling abroad, you may also be able to use your domestic currency in most locations overseas.
Make no mistake; the British pound and the US Dollar are two of the most widely used and exchanged currencies anywhere in the world, with a large number of developing countries accepting these assets in stores and outlets nationwide.
If you’re able to use your domestic currency overseas, this may well be the most affordable option as you won’t have to consider exchange rates or transaction fees.
However, you’ll need to ensure that you can use the currency widely before making the trip, as you may need to create a reserve fund in the native currency of whichever region you intend to visit.
