Are you ready for the big half term getaway? - Credit cards - News - Moneyfacts

News

Are you ready for the big half term getaway?

Are you ready for the big half term getaway?

Category: Credit cards

Updated: 19/10/2010
First Published: 19/10/2010

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

It seems like only yesterday that the kids went back to school after the summer holidays yet half term is already nearly upon us.For many families, this will mean a trip abroad in search of the kind of sunny weather that has long deserted these shores.

Official figures have just revealed that UK tourists spend more than £50 billion on holidays abroad over the course of a year, with air fares taking up the bulk of the cost (£16.4 billion), followed by food and beverage services, and accommodation - worth £5.6 billion each.

A foreign trip can be an expensive excursion, but there are a number of ways in which you could get the cost of your holidays down and make life much easier for yourself too.

Travel Money

  • There are loads of different places you can convert your cash into the local currency of the country you are visiting, all likely to offer different rates and charge differing amounts of commission.
  • Exchanging your currency 'commission-free' might intuitively seem like the best option, but it is important to consider carefully the rate on offer.
  • Often it will not be the most competitive rate you can get, so it is vital that you shop around to check out all the rates available.
  • Getting your currency in the airport is unlikely to be the best way to go about matters either. Besides from offering a more limited choice, the exchange rate is unlikely to be that great.
  • The golden rule is to exchange your currency before you get to the terminal and make sure you do your research.
  • Currency exchange websites are the ideal place to start, with even some of the older and more trusted names such as the Post Office now offering money exchange facilities online.

Traveller's Cheques

  • If security abroad is a top priority for you, then traveller's cheques might be a better option than carrying loads of cash.
  • If they are lost or stolen, you will quickly be able to reclaim your money in full, and all without having to claim on your travel insurance.
  • As with cash, however, shopping around for traveller's cheques is a good idea. Some places only offer traveller's cheques in certain currencies, while there might also be a fee for changing them.
  • Again, don't automatically assume that the commission-free deal is the best one out there.

Credit Cards

  • Credit cards might seem like one of the most convenient ways to pay your way when abroad, but it is vital to remember that most credit cards have a foreign usage fee payable.
  • This is typically around 2.75% of the amount you spend but could be higher still. If a credit card is the way forward for you, then applying for one which specialises in the travel market is essential. These will usually charge a lower foreign usage fee and, in some instances, have no fee at all.
  • If you're intending to pay off your holiday credit card spending over a number of months, a card with 0% on purchases for an introductory period is probably the one for you. The Post Office's Mastercard, which has 0% commission on overseas purchases and also offers 0% on purchases for three months might be a good place to start.
  • If you're holidaying within Europe, another option might be Nationwide's Gold Visa, which has no foreign exchange fees on purchases within Europe (a charge of 1% is made for worldwide purchases).
  • The most important thing to remember with credit cards is not to withdraw cash with them when abroad.
  • As well as possibly having to pay a foreign usage fee, you will also be charged a further fee for withdrawing the cash.
  • If you're not a fan of credit and would prefer to use a current account when on your travels,
    Nationwide's Flex account offers a debit card which allows you to make withdrawals for free within Europe (1% worldwide).
  • However, with Nationwide set to change the rules from November so that current account users will be charged a fee for using their card abroad, you will have to get in and jet away quick.

Travel Insurance

  • Besides all these steps that you can take to make your trip abroad a little cheaper, probably the single most important thing to arrange before jetting off is travel insurance.
  • Not only does travel insurance provide you with medical cover when overseas, it can also protect you from a whole host of other accidents and misfortunes that might just happen.
  • It can cover the cost of transporting you back to the UK if you are ill, and protect you in the event that you have to cancel your holiday due to accident or sickness.
  • It can also cover you for the loss of possessions or in the event of theft, as well as offering protection against any legal action taken if you injure another person or cause any damage to another person's property when away.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Top credit cards for Christmas spending

‘Tis (just about) the season to be jolly, but before all that festive fun begins, chances are you’ve got a bit more shopping to do. But, if you’re turning to credit to fund things, you’ll want to use cards that offer 0% interest deals on purchases.

Spooky reality of high balance transfer fees

Credit card debt is scary at any time of year. While most might assume that opting for the longest deal on offer would save them the most, our data shows some of the longest deals can actually work out to be the most expensive.

Reward credit cards that become ‘pointless’

If you regularly use cards to pay at the till, you may have considered opening a reward credit card to earn points every time you spend. However, not all of these cards are as rewarding as they may seem…
 
Close