Are you getting ready to fly abroad? Don’t forget to bring a travel-friendly spending card with you, which saves you enough for an extra meal, drink or day out.
a typical debit card costs around £6 to withdraw 250 euros from a money machine and around £2.50 when spending £100 in a shop or restaurant – costs that can add up quickly during your stay.
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But the best cards offer almost perfect exchange rates and free cash withdrawals from ATMs.
Here Harriet Cooke walks through the different options available depending on the type vacationer you are.
COZY TRAVELER
THE best travel debit cards have no expenses for spending or ATMs abroad, so you can use them as if you were going to the shops at home.
It means opening a new bank account, but you can do this in addition to your main account and transfer money if you don’t want to switch.
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Top picks are from Starling Bank† Pursuit and virgin money‘s M Plus accounts.
Some travel debit cards are linked to your main bank account, meaning you don’t need to open a new account or transfer money before you travel.
The Currensea card is the most important available and does not charge an ATM fee, although the free Essential plan has a 0.5 percent exchange fee on all card purchases.
Please note that some foreign ATMs may charge fees. So if you want cash, bring it with you.
Primary school teacher Jamie Melzack, 45, from Totteridge, north London, carries a Currensea card that he has used on trips to Cyprus, Abu Dubai and the US.
The father, who has daughters Amelie, 13, and Mia, 11, with wife Emma, 44, a business owner, is planning a road trip to France in the summer to avoid flight problems.
He said: “I love that I can just walk out the door and go to any country and the card, which has a great exchange rate, is all ready to use. I get an email every time I use it and app alert telling me exactly what I’ve saved each time compared to the fees my bank would have charged.
“So on a trip to a wedding in Cyprus a few weeks ago I saved £20 which is great when everything gets more expensive.”
OUR CHOICE OF TOP CARDS
When choosing a decent travel money card, you should look at the exchange rate and the fees that are added on top of that.
Financial expert Andrew Hagger, of the Moneycomms site, said: “There is very little to choose between Mastercard, Visa and Interbank rates. You just need to keep an eye on what your card provider adds on top.
“For many debit and credit cards, it is typically between 2.75 and 3%, otherwise known as non-pound transaction fees. The biggest thing to look out for is if the overseas retailer or ATM asks if you want to pay in pounds.
“This seems attractive to the British, because they know exactly how much will be written off. However, if you choose to pay in GBP, the retailer will use a local exchange rate (not Visa or Mastercard), which is very poor value and could end up costing you an extra five to ten percent.
“The golden rule is to always pay in the local currency.”
PLAY-IT SAFE SIGHTSEER
PRE-PAID cards are useful if you want to stick to a fixed amount while on vacation, but don’t want to carry around piles of cash.
They also allow you to pre-purchase currency and fix an exchange rate, although some only allow you to top up with pounds which can then be exchanged each time you make a purchase.
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The downside is that many charge fees, and often people forget they have money with them when they get home.
Some cards, like EasyFX after 12 months charge £2 a month if you don’t use the card.
Top picks are prepaid travel cards that use the interbank exchange rate – like the EasyFX card, which has a 1.8 percent fee when exchanging up to £1,000; and Hyperjarallowing spending at the Mastercard rate.
Finance employee Yaa Taylor, 49, took a Hyperjar prepaid card for a vacation to Turkey in May. Before going on holiday, she topped up her card with £250 in spending money, which was converted into Turkish liras for free when she spent it.
Mother of four Yaa said, “I like that prepaid cards have a spending limit so you don’t have to worry about being overdrawn or going over budget, which can happen on vacations.
“It was a nice trip with a boat trip and a visit to a Turkish spa, and I had money left at the end. I am now saving for my next vacation.”
EXTRAVAGANT EXPLORER
THOSE who like to spend money on holiday may prefer a travel-friendly credit card that protects them if something goes wrong with purchases over £100.
Credit card providers should take the same responsibility as the retailer if the customer is not satisfied.
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HalifaxClarity’s Clarity card has no charges for spending abroad or ATM withdrawals, although you must pay off ATM withdrawals on the same day to avoid daily interest.
Barclaycard Rewards Visa is another top pick, according to Expert in saving money, at no extra cost for use abroad. You must pass a credit check to get a credit card and withdrawals can be recorded on your credit score. Pay the debt before interest is charged.
Former business owner Peter Hall, 61, and wife Joanna, 54, who used to work in sales, enjoy a lot of vacation now that they’re retired.
Bournemouth couple subsidize travel by collecting Virgin points on the Virgin Atlantic credit cardwhich they convert into rewards such as flights, vacations and experiences of the Virgin Red Club† They also collect Avios points for BA flights with their amex Map.
Peter’s Virgin Atlantic card charges 2.99 percent for spending abroad, so he also has a Virgin Money credit card, which is free to use in the Eurozone.
Only the Atlantic card will allow you to earn points that you can spend on Red rewards.
He said: “For smaller purchases abroad, such as meals, I use the Atlantic card because the fees are worth the rewards. For larger bills, such as a hotel, I use the Virgin Money card to avoid the charges. If it saves me £20-£40 I’ll use the free card.”
OLD SCHOOL CASH LOVER
IF you prefer cash over cards, get the best exchange rate possible by exchanging at home before going abroad.
Use a site like Money Saving Expert’s to find the best deals TravelMoneyMax†
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Pick up is generally cheaper than cash delivery. Never buy at the airport unless you have arranged it in advance.
Do not purchase currency with your credit card as this counts as a cash withdrawal which means you may be charged fees and higher interest.
Harley Young, 24, a marketer from Manchester, likes to take foreign currency on holiday to control her spending while she is away.
She and her partner David Fowling, 31, who works in sales, used their local Eurochange agency to buy Hungarian forints for their city break to Budapest last month.
She said: “I usually spend cash during my vacation.
“Most of it is spent on meals, museums and days out.
“It’s easier to be in control and see how much you have left, while with a card, the money is invisible, so it’s easier to spend.”
The couple took just over £200 in currency for three days, but said they probably should have taken an extra £100.