Credit card, debit card or cash? We have spoken to experts to find out the best way to buy your holiday money this summer.
UK residents spend billions of pounds abroad each year, but it can be difficult to know how to make sterling go as far as possible. With summer fast approaching, so too are the opportunities to splash out on holidays, so the Money team spoke with travel experts to find out when, where and how to pay abroad.
The cheapest way to spend overseas is often on plastic, if you've got the right plastic,' said James Jones, head of consumer affairs at Experian. 'Using credit and debit cards can be a great way to get the very best exchange rates.' He said rates offered by currency exchange shops are usually 'much less attractive' than those offered on some cards, which were much closer to the rates the banks use themselves.
Some service providers don't apply fees for overseas use on their regular UK debit cards,' says Moneyfacts - but you must always check as some incur big fees. Alternatively, 'some service providers offer specialist travel debit cards that don't impose non-sterling transaction fees and cash withdrawal fees'.
If you're looking to avoid a credit check, prepaid cards can be loaded with multiple currencies and work like a debit card, without being connected to your bank. 'Typically, prepaid travel cards will offer competitive or even no charges for foreign usage, which can make them a cheaper alternative to using a normal credit or debit card while on holiday,' says MoneyFacts.
Don't rely solely on a card - it can backfire on you if you do,' said Mr Tipton. Some taxis only take cash, leaving you to face hefty charges withdrawing from an ATM. In some countries, like Argentina, it can be difficult to get money out of ATMs without a local bank account, Mr Tipton said. Mr Jones added: 'If you're in a very remote part of the world that actually doesn't have many ATMs and maybe where cash is king, then that might dictate what you need to do.
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