Plan half term holiday money now for a better deal
With October half term just around the corner, MoneySuperMarket.com offers tips to help those going abroad when schools break up.
Foreign currency
Families escaping to warmer climes during the half term week will benefit from arranging their holiday spend in advance. Leaving it to the last minute to buy your holiday spends at the airport when you arrive is the most expensive way to pay for your currency. Planning ahead by ordering cash online for delivery, or pre-ordering it for collection at the airport, will unlock better exchange rates and make your money go further.
Pre-paid cards
Rather than carrying large amounts of cash around, using a pre-paid currency card can serve as a great alternative. Many offer competitive exchange rates on foreign currency and some come without the sting of withdrawal and purchase fees. They can also be topped up quickly online so if you run out of cash, they are a useful tool – especially if any children are heading abroad this half term on school trips. Make sure you use a card which is designed for the currency you are using otherwise you could end up paying additional fees. The Global Traveller card from Caxton FX is a good option, and has no charges for cash withdrawals or purchases abroad.
Putting it on plastic
Those wishing to use plastic abroad can travel safe in the knowledge that using onespecifically designed for overseas usage is the cheapest way to spend overseas. However, it is important to do some research ahead of your trip to ensure you are maximising your money, as using a credit card for ATM transactions abroad can be expensive as interest is charged daily. Some providers can charge up to 2.50 per cent in fees however, Halifax’s Clarity Credit Card is free to use abroad for both point of sale purchases and ATM withdrawals. If you are planning to use a credit card, paying off your purchases in full every month will ensure that you avoid any interest charges and a costly bill when you return.
The scenario is the same when it comes to debit cards with some banks charging around 2 per cent for ATM withdrawals alongside a 2.75 per transaction fee. Whilst it may be too late for some to apply for a new current account, those who use the Gold Classic Account from Norwich & Peterborough Building Society will benefit best as it is free to use abroad.
Bob Atkinson, travel expert at MoneySuperMarket.com said: “Planning your holiday finances is just as important as planning where you are going to go on holiday. There are various options for how you spend overseas, so there is no excuse to pay over the odds. The key is to work out how you will spend before choosing whether to take foreign cash, use a pre-paid card, or put it all on plastic. Withdrawing currency in advance or using a pre-paid card is a good way to keep tabs on your spending, while debit or credit cards designed for overseas use arethe safest and cheapest options as you have the benefit of using a PIN protected card.”
Protection when abroad
Booking fun activities might fall above protecting your family and their belongings on your list of priorities, but having adequate cover in place is crucial. Whilst opting for the cheapest policy available is better than having no cover at all, you still leave yourself at risk of being under insured. For example a family of four traveling to Spain for one week can get cover for £7.99 with Cheaper Travel Insurance. Whilst this offers a good level of medical cover, protection against cancellation and baggage is only £500 with a £250 excess. By paying just £2.96 more for a policy with EHIC Plus, you will benefit from cancellation cover of £5,000 and baggage cover at a more generous £1,500 with a much lower excess of £75.
Bob Atkinson continued: “You should aim to arrange your insurance policy as soon as your trip is booked to ensure that you’re fully covered in the case that you need to cancel the trip. When deciding which provider to go with, be careful in reading the small print, to ensure that you’ve chosen a deal that offers your family adequate cover levels.
“It’s likely that if travelling abroad this half term, you’ll be going to an EU destination, so as well as taking out a decent insurance policy, make sure you and each member of your family are travelling with a European Health Insurance Card (EHIC). This gives access to state healthcare at a reduced cost in the unfortunate case that you need treatment. However, an EHIC is not an alternative to travel insurance as you may still need to pay some sort of fee for any treatment needed, therefore you’ll need to make sure you have your EHIC and your policy papers with you at all times.”