The
hidden truth behind travel money – the complete guide for penny
pinchers
Every year we sit around and wait for
that period of time when we can forget about work, leave the kids
with grandma and get on a plane bound for a far and mystical
destination. We spend hours planning it; which hotel is best value
for money, plan routes, compare ticket prices and research the
amenities at our chosen place of holiday. On my last trip to Brazil
with my wife I couldn't believe how much money we wasted on exchange
rates in retrospect. Once home, I educated myself on the subject.
Astonished at what I found, I wanted to share it with others so they
won't make the same mistakes we did.
You must think, “it can't be that
much”. Well, if you are converting Euros to Dollars you can possibly lose on €40
for every $500 you exchange! That got your attention didn't it? There
are 2 elements to consider when approaching the matter; the exchange
rate offered and commission fees. Exchange Bureaus make their money
from the difference between the value they buy and the value they
sell. The higher the exchange rate they offer - the better, so you
better find out what the current exchange rates are before buying or
selling any sort of currency. Commission fees may be in the form of
minimum charges, flat fees and handling fees. Beware, some bureaus
may offer great exchange rates but come with high commissions and
vice versa. Do your research – and pay attention to the details.
So here are some pieces of advice on
how to save a buck or two. First and foremost, stay clear away from
Airport bureaus – they are exchange death traps and are renowned
for offering poor exchange rates as well as high commissions. Also,
whilst you might expect your bank to give you the best deal on
foreign currency – don't just assume since it will not always be
the case.
Whilst away, pay cash whenever you can
- credit card usage often involves transaction charges which might
not seem a lot at the time but trust me, they pile up. Using your
debit card for purchases abroad might cost you approximately 2% -
your bank doesn't like it when you exchange your money elsewhere
(Check your bank credit policy before jetting off). Of course it
would be foolish to carry so much cash, the last thing you want is
for it to get lost or stolen and ruin your time away.
So what other cash alternative are
there to ensure your piece of mind? Prepaid cards have the same usage
as debit/credit cards but without the exchange rate fees , they work
by charging them with cash before the holidays. Travellers cheques
are also a safe bet though slightly outdated. However, even these two
are subject to different fees, so read the fine print.
In conclusion, my advice to you, is to
spend as much time planning your holiday money as you do the rest of
your trip. There is nothing worse than returning from a trip and
seeing a big dent in your bank account, especially when you will
already have the post-holiday blues!
