10 top tips for slashing the cost of spending overseas
| Author: Irene Robertson | Published: 19th July 2007 10:39 |
10 top tips for slashing the cost of spending overseas - get ready for the Beach
Whether you want to eat out with colons in Costa Rica, make phone calls with ringgits in Malaysia or do whatever with your dong in Vietnam, big travel money savings are now possible with a unique free new tool from consumer revenge site MoneySavingExpert.com.
The easy to use Travel Money Maximiser, located at www.moneysavingexpert.com/travelmoney searches all the main online foreign exchange bureaux to find the best deal, taking into account commission and delivery charges. It can increase the amount you get by over 10% compared with the worst online dealers. And these tend to be substantially cheaper than getting it in the airport anyway.
What £75 would buy you after all charges
(As at 20 June 07)
Currency--------Worst online-----Maximiser's Cheapest----Improvement
Euros--------------99---------------10--------------------------------8%
Chinese Yuans---955--------------1,069---------------------------12%
US Dollars---------131--------------144------------------------------9%
Turkish Liras------171--------------184------------------------------8%
How does it work?
Choose either the amount of currency you want or how much you're willing to spend. E.g. Ask "Who'll give me the most Euros for £100?" or "Who's the cheapest to get 200 Euros?"
The Travel Money Maximiser then quickly searches all the online bureaux to find the cheapest. Most importantly, it takes into account commission and delivery charges so you see exactly what you'll get. (Screen grabs available on request)
The best way to understand UK Travel Money Maximiser is to try it!
Visit www.moneysavingexpert.com/travelmoney
Martin Lewis, the creator of MoneySavingExpert.com, says,
"The problem with travel money has always been that there are a myriad of charges which confuse the actual rate. Many people think "commission free" makes it cheap. It doesn't. All it means is you don't pay a fee, but it's likely you'll get a worse exchange rate.
"In the past when asked how to do it the cheapest way, I told people to ask lots of providers, ‘How many euros/dollars/yen will you give me, after all fees, for my pounds?' and go with the one that offered the most. I got so fed up with this I decided to build a web tool to do it for you."
MoneySavingExpert.com Top Travel Money Tips
As well as using the www.moneysavingexpert.com/travelmoney to save cash, the following top tips will help you slash your costs:
- Don't leave it till the airport. The worst place to get foreign currency is at the airport; you'll often be charged up to 3% more buying there than at the same bureau outside the airport.
- Watch out for a 'load' on your plastic. Spend on a credit or debit card abroad and the bank gets the best possible exchange rate, called the ‘Visa/Mastercard wholesale rate'. This should mean more euros, dollars or Costa Rican colons per pound, but unfortunately, almost all cards add a ‘load'; an extra charge of up to 2.75%. In other words spend £100 of Euros and you're charged £102.75. Yet you won't spot this as the charge isn't broken out of the exchange rate. Find out how much your card(s) really costs at www.moneysavingexpert.com/cardoverseas
- WARNING! Halifax, IF, RBS, NatWest or Lloyds debit cardholders. These are the cards of shame! They've all introduced huge penalties for spending abroad that no other cards have. You'll pay up to £1.50 each time you spend, so buy something for a fiver and it'll cost you £6.50 and that's before the load. Do not use these cards abroad; you're better using foreign exchange.
- Withdraw currency on a credit card and you'll always pay interest. Pay off a credit card in full at the end of the month and normally you don't pay interest. Yet if you withdraw cash, something commonly done when abroad, almost all cards will charge you interest even if you pay off the card in full.
- Got a Nationwide Bank account? You're quids in abroad. If you've got a Nationwide bank account, then using its debit card is absolutely the cheapest way to spend abroad as it doesn't charge a load or a fee for withdrawing cash. It's even cheaper than using the cheapest foreign currency.
- Get a specialist travel credit card just for when you're overseas. If you don't bank with Nationwide, the next best thing is to get a Post Office credit card as it's still cheaper than getting foreign currency. It also gives the very best exchange rates as it doesn't add a load; however you will pay a fee for withdrawing cash, so it's best to spend on the card rather than withdraw cash. The Post Office just pips the other specialist travel cards from the Nationwide and Saga, as its interest rate is a little lower. The best thing to do is get the card just for when you trip away, and remember to set up a direct debit to pay it off in full each month. For full info www.moneysavingexpert.com/cardoverseas
- High street bureaux are cheaper online. Many high street bureau de change, such as Travelex, offer better rates on their websites; don't assume it's the same rate in both. However, order online and there may be a delivery charge. For the best of both worlds, order online then pick it up in the high street branch to avoid delivery fees. To find the very best rate use the new free tool at www.moneysavingexpert.com/travelmoney.
- Spending on overseas websites counts as spending abroad. If you pay for stuff on a website and pay in a foreign currency, this is just like spending abroad - so ensure you're using the cheapest plastic to do so.
- For big holiday/foreign website purchases use a credit not a debit card. Buy something abroad that costs over £100 and pay for it, or even just give a deposit, on a credit card, and Section 75 of the Consumer Credit Act means the credit card company is equally liable with the retailer if anything goes wrong. So if you can't get in touch with the retailer when you bring it home, call the credit card company and it has to sort it. You don't get this protection with cash or debit card spending.
• Never ‘pay in pounds' when you're overseas. If you're abroad and paying with plastic and the shopkeeper says "shall I charge you in pounds?" say no. This means they are going to do a currency exchange for you and the rate you'll get is usually substantially worse than using one of the top cards
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