5 savvy tips for spending abroad

By splitting your money into a mix of cash and cards, and keeping them separate in your bags and wallets, you’ll have flexibility as well as a back-up if some is lost or stolen.

Make sure you tell your bank you’ll be spending on your cards overseas, and keep a list of contact numbers for your banks separate to your cards in case you lose them and need to call to cancel. Also, check whether your travel insurance will cover you for lost cash. Your policy may have terms and conditions to follow, such as getting a police report.

It’s always useful to take some local currency with you in cash to pay for essentials. While most foreign exchanges are commission-free, the rates vary widely.

Buying money last minute at the airport or ferry will work out the most expensive, as exchange rates and fees are usually higher. The best way to find the cheapest currency is to compare rates online. You’ll then be able to pick the money up on the high street or even get it delivered.

Using your debit and credit cards on holiday can be expensive—you’ll often have a foreign usage loading fee, which can add up to 3% to the cost. Some cards will also add a fee on when you withdraw money from a cash machine.

But this isn’t always the case. Several credit cards and some debit cards have no loading fee or withdrawal fee, making them the cheapest way to spend.

Sometimes you might be offered the choice of how to pay on your card—either in sterling or in the local currency. The exchange rate is usually far worse than the one you’ll get from your card provider, so if you’re offered the choice of how to pay on your card, always choose the local currency. 

If you don’t want to use your debit or credit cards, then prepaid cards can be a good option. These can be loaded up with cash before you go, so you can spend without getting into debt or being charged interest.

These cards are growing in popularity as a safe alternative to travellers’ cheques, as the money you load onto the card is protected by a PIN. You’ll usually be charged a fee to take money out and to top up your funds though, and the exchange rate is set at the time you put money onto the card.