During this time of global self-isolation, most of us are daydreaming of how we’re going to celebrate the moment we can leave our homes again, and for many of us, that means a well-deserved vacation. Sadly, what should be blue-sky thinking is often hampered by the tough reality of how much it will all cost.
However, I’m here to tell you that there are a few ways you can save money while traveling, or at the very least there are travel expenses you can easily avoid with careful planning and thinking ahead.
Avoid Exchange Bureaus
Exchange bureaus have been a stalwart of holiday finance for decades, and they’re still one of the first places travelers visit to get their money, but they’re quickly becoming a thing of the past. With the rapid innovations and fierce competition in international and online banking, the exchange rates and fees offered by bureaus are frankly extortionate and are often barely representative of actual currency exchange values. The worst culprits of this by far are airport exchange bureaus. They depend on unprepared or unwitting travelers to exchange their money and they represent the worst value for money of any method of currency exchange. Avoid them like the plague.
These days most banks will allow you to take out and spend money in different currencies while abroad and you’re far more likely to find a reasonable rate and low fees through them. Plus, it’s a lot easier than finding a bureau; just go to any ATM and do as you’d normally do!
Don’t Pay ATM or Credit Card Fees
Even when using your own bank cards, fees are lurking around every corner. Banks will charge for exchanging your current currency into local cash, and credit cards usually charge a 3% fee on all transactions in foreign currency. Though these might seem small, they will add up, and it’s money you’re literally throwing away.
Thankfully there are ways to entirely avoid withdrawal fees. Cynthia Marx, a travel expert at 1Day2write and Britstudent, advises you to “find a bank that is part of the Global ATM Alliance, which allows free withdrawal from partnered ATMs around the world. Participating banks include Bank of America, Barclays, Deutsche Bank, and Westpac, amongst others. You could also open an account with one of the various online banks that offer free international withdrawals like TransferWise or Monzo.”
As for credit cards, there are various companies that have eliminated overseas fees, such as Chase Sapphire Preferred or Barclay Arrival Plus. If you’re going to be away for a significant amount of time, it might be a good idea to investigate these options.
Even once you’ve got accounts with companies that aren’t going to charge you fees, there are still common avoidable ways in which you’ll be charged for spending your money abroad. While it may not always be possible to avoid all fees, the solution is to be smart about how you withdraw and spend money.
Hugh Fernley, a writer at Writemyx and Nextcoursework, says “Always use credit cards first, then ATMs. These two (in that order) are your best options for exchange rates, both far outstripping exchanging cash either at home or abroad. Also, if given the option, always opt to withdraw and spend in the local currency. You may be tempted out of convenience, but the exchange rate will always be better with your bank, so always pick local currency and allow your bank to exchange the amount for you.”
Finally, when it comes to ATMs, always look for reputable ones in official banks. Often you might be tempted by machines in stores or hotels (or airports…), but the convenience will cost you. These machines are notorious for offering high fees and bad rates, and some may even be rigged to steal your card details. Steer clear of any ATM from Euronet: they push you to withdraw more money than you need to, then give you a rate far worse than the official number; it’s daylight robbery.
These are the main ways in which you can avoid spending more than you need to while traveling. Notice that none of the tips on here are actually impacting on your experience in the country. You could have the exact same vacation twice, without compromising, and come out having spent hundreds of dollars less by following these tips.