How to avoid hidden holiday costs this summer

Buy your holiday money in advance, not at the airport. You’ll get a much better rate of exchange. Make sure you’re buying from a company that’s authorised by the Financial Conduct Authority (FCA), and if you’re having the money sent by post, check what the delivery charge is, and whether it is being sent by recorded delivery.

MoneySavingExpert has a currency calculator which enables you to search for the current best buys.

It is safer to use a credit card or travellers’ cheques rather than take all your spending money in cash? A couple of credit cards are your best option. 

Take one for paying for refundable hotel deposits and car hire, so that your credit limit isn’t maxed out, and one for every day spending. You’ll get a more competitive rate of exchange and no commission fees.

Don’t use your credit card to withdraw money from foreign ATMs, as you’ll be charged a fee and interest from the date of withdrawal. 

If you are given the option to purchase in local currency or sterling at a shop or restaurant, you should always choose the local currency because you will benefit from the credit card provider’s exchange rate, rather than the merchant’s rate which is likely to be inferior. 

Using your credit card to make purchases over £100 also gives you some protection if something goes wrong. A good card for overseas spending is the Halifax Clarity card which has no fees.

You should shop around and choose a deal before you leave the UK. Don’t leave it until you are standing at the arrivals lounge abroad.

According to iCarhireinsurance, many travellers are still not factoring in “extras” at the rental desk when they’re hiring a car. If a family purchases an additional driver (£68), a sat nav (£102), a child’s car seat (£82) car hire excess insurance waiver (£83), super theft waiver (£75) and tyre and windscreen excess waiver (£18) for a week this August in Spain it will cost an additional £428 on the original car hire price of £301.  

Make sure you leave plenty of time to return your car, so that you can find and visit a petrol station before you drop off your hire vehicle and avoid a surcharge on fuel. 

You can save money by not reserving an airline seat, although you may find that you and your travelling companions are split up and distributed around the plane. The earlier you check in, the greater your chance of sitting together, but with online check in available in advance, there’s no guarantee of that.

Mobile costs: Use the hotel WiFi, not data roaming as it will be really expensive. Switch off your data when you are outside free WiFi zones.

Following the Foreign and Commonwealth Office (FCO)’s warning that the European Health Insurance Card (EHIC) will not apply if we enter a no-deal Brexit scenario, it’s essential that you have travel insurance. 

At present, the EHIC is issued free of charge and allows anyone who is insured by or covered by a statutory social security scheme of the EEA countries, as well as Switzerland, to receive medical treatment in another member state free, or at a reduced cost, on the same basis as a resident of that country.

AllClear Travel, a specialist in medical travel insurance, says the EHIC is extremely widely used, with 93 per cent of its customers saying they carry an EHIC card.  

Even if a deal is successfully negotiated with the EU and the EHIC continues to be available to UK citizens, it is not a substitute for travel insurance as it does not cover the cost of repatriation (returning a person back to their home country), which the new figures show to cost between £3,000 and £7,000 in Europe. 

The EHIC also does not provide cover for cancellation or for baggage claims and only offers access to the same state healthcare as provided in the country visited, which may not be the same as the NHS and does not include private medical treatment. 

Travel insurance product manager Simon Williams, of comparison website Compare Cover, said: “The best thing for holidaymakers to do is to look carefully at the type of travel insurance they are taking out. Ensure that it will cover you in all pre and post Brexit eventualities and if you are in doubt, pick up the phone to your current or chosen provider and go through all eventualities to ensure you can holiday with full peace of mind.”