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Nine tips for saving money on your summer holiday in 2019

Don't let card fees and exchange rates ruin your trip

With the arrival of summer, millions of UK holidaymakers will be jetting off to spend time relaxing and enjoying the sunshine with their loved ones.

But a trip abroad can quickly blow through your budget, especially if you’re hit by rip-off card fees and poor exchange rates.

Which? offers ways you can enjoy an amazing break in the sun without burning a hole in your wallet.


1. Avoid currency conversion rip-offs

When you go to the ATM or pay with your card abroad, you may be given the option to pay in Sterling, instead of the local currency.

This service, known as dynamic currency conversion (DCC), means banks or businesses can use their own currency rate for the transaction.

In almost all cases, this rate is likely to be much worse than the one you’d be offered by your own card provider, especially if you’re using a travel credit or debit card.

Instead, you should always opt to pay in the local currency.

Indeed, in April it was announced people who use Mastercard currency cards, such as Caxton, WeSwap and FairFX, will no longer be given the option to withdraw money in pounds.

2. Be wary of credit card fees

When you just use your normal credit card on holiday, you could be hit with three different types of fees:

  • Non-sterling transaction fee – this is a percentage of the value of each transaction. You’ll typically pay up to 2.99% each time you use a credit card.
  • Non-sterling cash fee – you can also expect to pay a fee of around 3% (or a minimum of £3) when you take money out of an ATM with a credit card.
  • Interest on cash withdrawals – when using a credit card you’ll be charged interest on cash withdrawals straight away, until the date you pay off your balance.

Specialist travel credit cards generally don’t charge you these extra fees, making them a better choice to pack for your holiday. You’ll also have the option of borrowing money in an emergency, like if you need to re-book flights or pay for healthcare out-of-pocket.

The table below shows the best travel credit cards on the market – the links take you through to Which? Money Compare. Alternatively, you can find out more in our guide to the best travel cards.

Credit card and issuer Non-sterling transaction fee Non-sterling cash withdrawal fee Cash withdrawal APR Representative
Barclaycard Platinum Cashback Plus (Visa) 0% 0% 0%* 21.9%
Creation Everyday Card (Mastercard) 0% 0% 12.9% 12.9%
Santander Zero Credit Card (Mastercard) 0% 0% 18.9% 18.9%
Tandem Cashback Credit Card (Mastercard) 0% 0% 18.9% 18.9%

* Pay no interest for up to 56 days as long as you pay off your balance in full each month, otherwise you will pay 27.9% APR.

3. Opt for a fee-free debit card

Similarly to credit cards, you can rack up a fees quickly using your everyday debit card on holiday.

Some banks offer fee-free options for overseas spending on your everyday debit card.

Both Starling Bank and Cumberland Building Society offer debit cards with no additional fees for purchases, transactions or cash withdrawals overseas.

Monzo, meanwhile, which is also a Which? Recommended Provider, offers fee-free transactions and free cash withdrawals of up to £200 a month.

You can find out more in our guide to the best debit cards to use abroad.

4. Consider a prepaid travel card

You can load a prepaid card with cash to take overseas with you. Some will let you select specific currencies when you load it, locking in the exchange rate on that day, while others allow you to exchange as you go.

Most online and high street retailers offer prepaid cards. You can generally add money to your card over the internet, via text or by phoning your provider.

Prepaid cards offer the advantage of not needing to take large amounts of cash abroad. If your card is lost or stolen, balances are protected and can be transferred to another card.

However, prepaid cards are not covered by Section 75 of the Consumer Credit Act, although those using cards from Visa and Mastercard may still be able to retrieve funds using chargeback.

Read more: prepaid credit cards explained

5. Book train travel in advance

If you’re planning on taking the train to your destination or to the airport, you can slash the cost of your travel by booking an advance fare.

These tickets are normally released 12 weeks before you travel and can allow you to save up to 80% of the full price. As an example, the anytime fare from Manchester Piccadilly to London Euston in August costs £175 but an advance ticket is £29 – a massive 84% reduction.

Splitting your ticket can also have a huge impact on how much you’ll pay. This essentially requires you to book legs of the journey  individually, rather than booking all the way through to your end point.

An alternative way to cut down on travel expenses is to look for slower routes to your end station, or to travel at off-peak times.

6. Don’t buy your travel money from the airport

Airport bureaux de change will rarely offer the best currency exchange rates, as they have little incentive to be competitive.

You might be better off buying foreign currency on the high street in advance or at the Post Office.

Alternatively, you can increasingly buy your travel money online, but make sure you use a legitimate company.

7. Download a budgeting app

If you want to take control of your finances on holiday, a number of apps let you view all of your income, outgoings and spending habits in one place.

Which? has looked at five budgeting apps to help you save cash.

Most of these apps are registered with the Financial Conduct Authority. They are also part of the Open Banking Initiative, which has seen the nine largest banks open up their data to third parties through a secure channel with your consent.

8. Remember your Ehic

If you’re heading to an EU destination, or Iceland, Norway, Liechtenstein or Switzerland, you should make sure you apply for an Ehic card before you go.

Showing this card entitles you to treatment in state hospitals at the same price as residents of that country, often for free or very low-cost.

Without an Ehic, you may be asked to pay for any treatment up-front.

Applying for an Ehic card is free, but some copycat websites will try to charge you, so make sure you apply directly through the NHS website.

Keep in mind that if the UK leaves the EU without a deal on 31 October, you may no longer be entitled to state-sponsored healthcare under the Ehic.

9. Find the cheapest travel insurance

According to the Foreign and Commonwealth Office, 24% of travellers head off on holiday without insurance.  But this could land you a bill for hundreds of thousands of pounds if you have an accident or become unwell.

This is true even if you have an Ehic. For example, you won’t be covered for mountain rescue, returning to the UK with a nurse or air ambulance, having possessions stolen or cutting your holiday short.

Arranging suitable travel insurance could save you in the worst case scenario.

When looking for good travel insurance, it’s wise to shop around for the right policy and make sure it gives you the right level of cover. You can see how we rank providers in our guide to the best and worst travel insurance.

Which? Limited is an Introducer Appointed Representative of Which? Financial Services Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited.

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