Save a fortune on your summer holiday

I’ve been out filming Superscrimpers in Newcastle. I’m leaving amazed. First by the amount of holidays people appear to take. Not one single person I spoke to said that, what with times being tough they weren’t taking a foreign holiday this year. Instead they mostly seem to be going to Thailand for three weeks or Florida for two.

And second, given how much they seem to travel, how unsavvy they are about currency exchange. They all shop around endlessly for flights and for hotels. But when it comes to buying their dollars and euros? They do it on the high street or, worse, at the airport.

They aren’t alone of course – an estimated 1.7 million people did the same last year – but that doesn’t make it any less nuts. I spent some time scanning the windows of Newcastle’s travel agents for their exchange rates: in some cases the spread (the gap) between the rates at which they buy and sell was getting on for 10%. And at the airport, the rates are so utterly rubbish that you can end up paying £12 over the odds for every £100 changed, according to Moneysupermarket numbers. Yes you did read that right. 

The UK public has become much more financially aware over the last few years – as the banks are learning to their cost – but it looks like currency has remained something of a blind spot. Given how little the pound now buys at the best of times (it has fallen over 15% against the euro since 2008) that’s not a good thing.
So what do you do instead? If you must have currency in cash in your hand before you go, order it online and pick it up at the airport. But otherwise get a pre-paid card. These have been around for a few years now, but have yet to become the default option for all overseas spending, even although they really should be: only one of the people I spoke to in Newcastle even knew they existed.

Pre-paid cards are very simple. You buy your foreign currency and load it on to your card: this is extremely easy – once you have an account set up, you can even arrange it via a text message with the main companies. Then you use the card abroad just as you would a normal debit or credit card. The exchange rates tend to be very competitive and while the charging structures are slightly different for each card, the best offer the cheapest – and possibly quickest – way of buying foreign currency there is in the retail market.

My long-term favourite is Caxton FX which comes with no charges at all, but the FairFX card is also very competitive. Its exchange rates are often very slightly better than those at Caxton. But it charges a fee (€1.50/$2) when you withdraw cash from an ATM, something which irritates me given that one of the main points of having a pre-paid card is ready access to cash.

Finally, note that carrying a pre-paid card is a great deal safer than carrying a whole load of cash around with you: they come with a PIN. You can – and if you ever travel abroad you probably should – compare all the main cards at Otherwise, if you want to see all the best rates across the board you can compare pretty much everything at Compare Currency

  • Concerned of Teddington

    Yeah, and before they go on holiday, they all go to Spar (not even Waitrose essentials) and make themselves plenty of sarnies to eat whilst they are out there.

  • Euro traveller

    Merryn, I assume you only travel in Europe and the States. Try using these cards in Africa, Latin America, Asia and even Eastern Europe anywhere outside the major cities and see how far you get. Same goes for credit cards. You can book airpalne tickets and settle the hotel bill, but can’t even fill up the rental car’s tank without some cash. You would be surprised at how widespread the use of cash is still in most of the world.

  • Merryn

    Concerned, That’s Manchester…

  • Critic Al Rick

    Actually, taking holidays abroad is bad for the UK’s Balance of Payments; bad for the UK economy.

    Taking holidays in the UK is supporting the UK economy.

    It’s time people realised the UK is NOT wealthy as once deceptively portrayed, but is a very ‘sick’ country; it is high time people considered the greater good of the UK rather than their own selfish agenda; such selfishness and other selfishness combined with greed has contributed greatly to the demise of the UK.

    But the biggest culprits come from within our elected representatives; they have betrayed us by encouraging the leeches that parasite off us.

    That’s the result of so-called democracy for you; short-sighted stupidity. That’s the majority for you; the people get the govt they deserve.

    The people should wise-up.

  • Romford Dave

    Valid points Al, although perhaps a little off topic.

    On the topic of elected representatives and in the spirit of being off topic, yesterday’s bemused reaction of the Lib Dem faithful, with some espousing outright criticism of the stupidity of the electorate for their negative yes vote, was refreshingly astute, if self harming. Don’t they know that self harming can be mistakenly classed as attention seeking behaviour!

    Getting back to the thrust of Merryn’s article, it does reinforce her much expressed view of the general lack of financial awareness in the public at large. Personally I think our free spending globe trotting Brits couldn’t care less, confident that Nanny will compensate any perceived stupidity courtesy of a Judicial proclamation from the cloistered perspective of wig wearer in the fullness of time.

    Always conscious of course that students of Zen would argue that trying to define who’s stupid in this instance is almost as difficult as trying to define quality.

  • westlondonlad


  • The Boy Racer

    Hi Merryn – you don’t mention how the rates compare if you simply withdraw cash from an ATM abroad using (eg) a Visa Debit card? My First Direct account levies “no charge” for doing so (though I imagine I am ripped off somewhere in the process). Cheers.

  • Alberto

    How can a prepayd card be safer than cash?
    If you don’t spend cash you can change it back.

    If you lose a prepayd card no matter there is a PIN, you lost your money, same as cash. OK, PIN removes incentives for thieves.

  • Concerned of Teddington

    This thread has made me feel guilty: just picked up my Waitrose ‘Good To Go’ baguette of Beef and Horseradish with Purdey’s vitamin drink – I can’t help but feel its the scrimping and saving equivalent of a plate full of oyesters all washed down with a few glasses of Pol Roger.

    Extrapolated over a lifetime, I suppose my Beef and Horseradish is costing me an arm and leg, or at least , a fortnight on the Algarve, if not a week on some South Pacific paradise like Hiva Oa.

    Sadly, there are no ‘Spar’ establishments in Canary Wharf. A market opportunity or just plain bonkers …

  • yeltam

    Even though they are now charging, the Nationwide Flexaccount is still the cheapest way of withdrawing cash from european ATMs. Their credit card and the SAGA credit card won’t charge for use in Europe. Why go elsewhere?

  • Shaun

    Having travelled extensively, I always find that good old fashioned GBP or USD travellers cheques are the best, particulalry if you’re travelling to non EU countries or the US. If you don’t use them you can just pay them back into your account. No commission, no fuss. Last year I took the family to Egypt and the rates offered locally for Egyptian Pounds in exchange for ‘hard’ currency was way above what you get at places like Travelex or your high street bank. Just a thought.

  • Postman Pat

    Despite not being from either Newcastle or Manchester, I have not heard of one of these cash cards either.

    However the points Merryn make are pretty valid. The biggest surprise of all is that anyone actually changes cash at an airport at all.

    People do need to be educated as the vast majority (myself included by the look of it) are not fully aware of all the options open to us.

    If the article made you think then it did its job. Me and Jess are off to see where we can get a cash card now for our next overseas delivery! Toot toot!