With summer well on its way, millions of us Brits will have exciting plans to jet off on holiday in the coming months and soak up the sunshine abroad.
But from booking your flights and hotel to getting essentials for your suitcase, there's a lot of preparation that goes into a holiday - and if you're not careful, doing things the wrong way could see you getting caught out and spending much more than you need to. This is all too common when it comes to taking out travel money for your trip, with loads of options out there making it all too easy to go with the most convenient choice and end up not getting good value on your exchange.
With that in mind, Martin Lewis' MoneySavingExpert (MSE) team have compiled a list of the five "need-to-knows" when it comes to exchange rates. From avoiding debit cards "from hell" to the one place you should never get your money, here are five top tips to help you avoid common pitfalls when you're getting out holiday cash according to the MSE website.
1. Cards can beat cash rates - but you need the right one
Using a normal card, or travel cash with a poor rate, to spend money abroad means you are "paying to pay", the MSE team warned - the difference between paying for things overseas using the cheapest way compared to the most expensive method can be as much as £100 per €1,000. A special travel credit or debit card is "almost always" the most cost-effective way to spend on holiday and even beats bureau de change rates, according to MSE - you can see their guide on travel credit cards here.
2. Steer clear of using credit cards to buy your travel money
If you pay a UK bureau for currency using a credit card, it's usually treated as a cash withdrawal, MSE warned, which means you're likely to pay a cash fee and have interest added even if you fully repay. It's always best to use a debit card or cash to buy currency, the experts advised.
3. Avoid the debit cards 'from hell'
Most debit cards charge a non-sterling transaction fee for spending or withdrawing cash abroad, typically around three per cent of the transaction - but a few debit cards come with "nightmarish" charges when used overseas, the MoneySavingExperts warned. These cards charge another "sneaky" spending fee of between 50p and £1.50 each time you use your card on holiday - you can see the full list of these cards here.
4. Don't let bureaux de change hold your cash for long
If you use a bureau de change to exchange cash, and it goes bust while it has your money, you have no protection and will likely end up losing all your cash, MSE warned. The experts explained that they warn against using these firms as a tool to buy money a long time in advance or send large amounts abroad for this reason - they should only be used for small holiday transactions, and handing over your pile of cash in return for theirs is the safest route.
5. Never get your travel money at the airport
If you wait until you're at the airport or ferry terminal to get your holiday, you will be stuck with the "worst rates possible", MSE cautioned. If you're left with no option but to get your cash from the airport, they advised pre-ordering it for pick-up at least a few hours before you get there to get a better rate.
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