With a little forward planning you can maximise your precious travel budget when travelling overseas by being aware of a few tips for using foreign currency abroad: 

1. Never, ever change your money at the airport. Ignore “commission free” advertising as inevitably the exchange rate offered will be terrible. Banks usually offer the best rates and you can often pre-order travel money for pick up or delivery.

2. Consider a travel money card. In many travel situations it is advisable not to carry too much cash, which is when a travel money card comes in handy. This is a secure, convenient way to carry multiple currencies while incurring lower fees than credit and debit cards. Every time you put your debit card in a cash machine overseas you will be charged a hefty percentage. Beware of shop assistants asking if you want to convert the price into your home currency, as this will incur further charges.

3. Use travel cards overseas carefully. With travel money credit cards, it is usually best to use then only when abroad. Remember that it is far cheaper to spend on these cards than to withdraw cash and spend it. And always set up a direct debit to repay the balance in full every month, otherwise the interest charges will dwarf your cheap currency gains.

4. Manage your credit card balance. If you prefer to use a credit card both at home and abroad consider saving money on your existing credit card balances by opting to use a credit card transfer service, transferring your balance to a new card with zero per cent interest.

5. Beware of shop assistants bearing gifts. Don’t just agree if a shop assistant or restaurant employee asks if you want to convert the price into your home currency when paying by card. This will incur further charges so make sure you pay in the destination currency.

Happy travel planning!

By Natasha von Geldern

By Natasha von Geldern on March 6, 2014.