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The pound is currently at a six-month low at a value of €1.11. This also means that it is struggling against the US Dollar, with one pound getting you a mere $1.25. The glory days of GPB 1 = 2 USD have been gone for years, but this most recent downturn could mean a significant increase in how much you spend when you’re on holiday in Mainland Europe or across the pond.
Book Flights With Points and Miles
If you haven’t started collecting points and miles yet, now is the perfect time. Wherever you are going in the world, miles can make a difference to the cost of your flight — from economy all the way to first class. The money you could save on getting to your destination would then help to offset the money you spend while you’re away because of the weakness of the pound. Here are a couple of examples of redemption sweet spots for travel to either Europe or the US:
- With British Airways Reward Flight Savers, you can get flights to Europe from as little as 4,500 Avios and £17.50 one-way.
- Virgin Atlantic’s redemptions for flights to New York start as low as 10,000 miles and £136 in economy one-way.
Avoid Exchanging Currency
Whether you exchange currency through your bank, the Post Office or a high-street Bureau de Change, they will almost always charge you a percentage or a fee for the service. Depending on the sum you want to exchange, this could be quite substantial. This goes for changing any leftover currency from your trip, too.
How do you avoid it? By using your cards instead of cash. Gone are the days of ridiculous bank charges, and the world is becoming more and more cashless every day, with Sweden leading the way as it plans to be the world’s first cashless nation by 2023.
If you insist of having a bit of cash on you when you arrive in a foreign country, then don’t leave it to the last minute when you’re at the airport — this is where you will really pay through the nose.
Use a Credit or Debit Card With No Foreign Transaction Fees
Most credit cards incur a 2.99% fee on foreign transactions. This is where the Curve card comes into its own. By linking your credit card, it gets turned into the equivalent of a debit card, and spending abroad incurs no fees. You can also take out cash from ATMs at home or abroad without a transaction fee. The downside for miles and points cards is that no American Express cards are compatible at this time. However, the Virgin Atlantic cobranded credit cards are compatible, which means you can still earn miles while you’re away with no foreign transaction fee.
If you prefer to use your debit cards while you’re abroad, it works in the same way.
Withdraw Cash From Local ATMs
If you’re somewhere that rarely accepts cards, then use local ATMs rather than going to a Bureau de Change. I learned this a few years back and was shocked at how good an exchange rate I got when doing it. Before travelling, double check with your card issuer to make sure your card is set up to be used abroad so that it doesn’t get blocked. Certain issuers may also impose charges for doing so, so have a quick check of this too before you travel.
Always Pay in Local Currency
This is a simple one. When you’re handed the card payment machine and have the option of paying in pounds or the local currency, always pick the local currency. By paying in pounds, you will incur a Dynamic Currency Conversion fee which means that you’ll end up paying more than if you have opted for the local currency.
Featured photo by TEK IMAGE/SCIENCE PHOTO LIBRARY/Getty Images.
Know before you go.
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