Hooray! Summer holidays are cheaper this year

Content provided by Caxton FX

The last two and a half years have been turbulent for sterling, however the travel industry is showing no signs of slowing down as tour operators are slashing 2019 summer package prices by as much as 36 percent according to price comparison site TravelSupermarket.

The pound is currently holding steady against both the euro and the US dollar, but the ongoing risk of chaotic Brexit negotiations is likely to see greater volatility ahead. Holidaymakers need to continue to be careful if they want to get more for their money.

Caxton’s top tips for protecting your holiday money:

1) Use a prepaid card

Prepaid cards are a great way to get the most out of your holiday money. Not only do they tend to offer great exchange rates, and few (if any) charges when spending abroad, they also allow holiday makers to pre-load exactly how much they want to spend, meaning you are less likely to blow your budget. (For example, the Caxton prepaid card does not charge you for using ATMs abroad, which could save you an average of £3 per cash withdrawal compared to your debit card.)

2) Avoid airport bureaus at all costs

Always avoid airport bureaus for exchanging money as they generally provide poor value. The bureaus have captive markets in the airport, leaving them free to offer travellers terrible rates and commission. Make sure you plan ahead to avoid this. Even if the rate is just 2 percent higher, this could be as much as £40 on the average family’s holiday spending money.

3) Watch the rates to take advantage of gains

Brushing up on how the markets work and understanding what a good exchange rate is for your holiday currency always helps to make more informed decisions.

Also take note of big economic events since they can significantly influence the strength of a currency, so keep up to date with current affairs, and check the news headlines. It’s worth taking advantage of gains in your favour. If you see news that the pound is strengthening, it’s worth booking some of your holiday money that day!

4) Hedge your bets

Consider playing it safe: you can hedge your bets by exchanging half your currency now, half later. This can be done easily by locking in a rate on a Caxton Pre-Paid Currency Card. That way, whether the rate goes in your favour or against you, you’ll benefit from the higher exchange rate on at least half of the amount.

5) Insist on paying in the local currency

If you are using a debit, credit or pre-paid card when travelling abroad, always be sure to pay in the local currency of the destination you’re in. People mistakenly believe that they should select to pay in pounds. However, by paying in sterling, the money will be converted twice - known as dynamic currency conversion - resulting in unnecessary charges. In some cases, this could be as much as £6 per transaction, which quickly adds up over the course of a holiday.

To discover all the ways a Caxton FX Pre-paid card could help you get the most out of your summer holiday, click here.