Travel Money Guide

What is the best way to take money abroad? For most travellers, we think the answer is a combination of some local currency and the right cards.

At besttravelmoney.com, we compare travel money exchange rates, prepaid travel cards, debit cards and credit cards to help you work out the cheapest and safest way to spend abroad.

The important bit is to compare before you travel. Exchange rates and fees vary considerably, and a little planning can mean more of your holiday money gets spent on your holiday rather than on charges.

If you want to buy travel money in the UK, compare exchange rates online before ordering.

The amount of foreign currency you receive for your pounds can vary significantly between travel money providers, high-street bureaux, supermarkets, banks and the Post Office.

For example, the difference between competitive and poor rates can easily be worth £20 or more on a £750 currency order.

Our tip: don’t automatically choose the name you recognise. Specialist online travel money providers often offer some of the best exchange rates for foreign currency.

Usually, you’ll find a better exchange rate by ordering your currency online rather than simply walking into a branch.

You can either choose travel money home delivery or order online and click and collect your currency from a branch.

For smaller amounts, click and collect can be particularly useful because you can secure the online rate without paying a delivery charge.

We don’t think it needs to be one or the other.

Taking cash and cards abroad gives you flexibility. Cards are convenient for hotels, restaurants and larger purchases, while local currency can be useful for taxis, tips, markets and smaller businesses.

Cash is also a useful backup if your card is declined, lost or temporarily blocked.

Our advice: take some local currency and at least two cards, and don’t keep them all in the same place.

A travel money card, sometimes called a prepaid currency card or multi-currency card, lets you load money and spend abroad without using your normal bank card.

Depending on the provider, you may be able to hold euros, US dollars and other currencies in advance, or have your spending converted when you use the card.

When comparing travel cards, look at the exchange rate, foreign transaction fees, ATM withdrawal charges and any limits rather than concentrating on just one advertised feature.

At besttravelmoney.com, we currently rate Wise highly because of its transparent pricing, multi-currency functionality and competitive currency conversion.

Your normal UK debit card will usually work overseas, but that doesn’t mean it’s cheap.

Some UK banks charge a foreign transaction fee on purchases and may add further charges when you withdraw cash from an ATM abroad.

A specialist debit card with no foreign transaction fees can therefore make a considerable difference.

Starling and Revolut are among the options worth comparing for overseas spending, but always check the current charges and withdrawal limits before travelling.

The right credit card can be an excellent way to pay overseas, particularly if it doesn’t charge a foreign exchange or non-sterling transaction fee.

The Halifax Clarity Card has long been a popular option for UK travellers because it doesn’t charge a foreign transaction fee on purchases.

Credit cards can also provide valuable consumer protection on qualifying purchases under Section 75 of the Consumer Credit Act.

However, be careful when withdrawing cash. Credit-card ATM withdrawals can attract fees and interest, so check the terms of your particular card before using it for cash.

This is one of our simplest travel money tips.

If a card machine or ATM asks whether you want to pay in pounds or the local currency, we would normally choose the local currency.

Choosing pounds can trigger Dynamic Currency Conversion (DCC), where the retailer or ATM operator sets the conversion rate.

That rate may be considerably worse than the rate provided by your card issuer.

In Spain, choose euros. In the USA, choose dollars. In Japan, choose yen.

Don’t let the machine convert the transaction back into pounds simply because it looks more familiar.

Even if your UK card doesn’t charge for overseas cash withdrawals, the ATM operator may charge its own fee.

Where possible, we prefer ATMs operated by established local banks rather than independent machines in tourist areas, shops or petrol stations.

Always check the screen before accepting a withdrawal and, again, decline any offer to convert the transaction into pounds.

Leaving your travel money until you reach the airport is convenient, but convenience can be expensive.

Airport bureaux often offer less competitive exchange rates than you’ll find by comparing and ordering currency in advance.

If you know you’re going to need cash, compare online travel money rates before you leave home.

Apps such as taxi and travel services may offer to convert an overseas purchase into pounds for you.

That isn’t necessarily the best deal.

When our co-founder Mark Austin travelled in Texas, Uber converted a US$61.89 fare into £46.38. The exchange rate was reasonably close to the wholesale rate, but Uber also added a £0.68 currency conversion fee.

It wasn’t a huge amount, but these little charges add up.

If you’re using a card with low or no foreign exchange fees, paying in the local currency will often make more sense.

If you’ve only got €20 or €50 left after your holiday, it may be worth keeping it for your next trip.

For larger amounts, compare foreign currency buy-back rates before selling your travel money.

Buy-back rates vary just as much as rates for buying currency, so don’t automatically return to the company you originally bought it from.

At besttravelmoney.com, you can compare travel money buy-back rates and see how much different providers will give you for your leftover currency.

For most trips, we’d suggest taking some local currency for small purchases and emergencies, a low-fee debit or travel card for everyday spending and cash withdrawals, and a no-foreign-transaction-fee credit card for larger purchases and as a backup.

There isn’t one payment method that’s best for every country or every traveller.

That’s why our advice is simple: compare travel money rates and card charges before you go, take more than one way to pay, and always understand the exchange rate and fees before accepting a currency conversion