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Money mistakes to avoid when travelling

Travel imageWith the new year well underway, one of your resolutions might be to travel more and explore the world. What better way to have new experiences than to put yourself out of your comfort zone and head overseas? Coming out of the expensive Christmas and New Year period can make travelling hard on the wallet, so give yours a break with these handy tips.

Keep the following in mind if you want to enjoy your overseas experience without breaking the bank.

Choose the best time to fly

It’s no secret that the busiest times to fly are during the festive season and during school holidays. Airlines and hotels are aware of this spike in demand and their prices fluctuate accordingly. A analysis discovered that during Christmas and New Years, popular holiday destinations cost, on average, 43% more. To avoid paying more than you should, consider travelling outside of these peak periods, or try booking your trip well in advance so that you can avoid inflated prices for flights and accommodation.

Shop around and compare flights

Not all airlines and hotels will be priced the same, even if they’re within the same star rating. Use a comparison tool such as Skyscanner or Expedia to help determine when the cheapest day to fly is. Moving your holiday a day or two earlier could save you a couple of hundred dollars, which means you’ll have more to spend on your trip.

For example, a one week trip to London from Sydney leaving on Friday 2 February costs $1,437, however, opting to leave two days earlier costs $1,256, a potential saving of $181. Note that prices can also fluctuate in a matter of hours due to cookie tracking, so consider clearing your cookies or opening an incognito window to prevent targeted pricing.

Pick the right travel money option

Using your regular credit card overseas can incur extra charges such as currency conversion fees and overseas ATM withdrawal fees. While cash may seem like an attractive option to avoid these charges, you can still enjoy the convenience of a card overseas by considering a travel money card.

A prepaid travel money card allows you to load your own funds onto the card in multiple currencies. You can also lock in an exchange rate if you load a certain currency at a time when it’s at a favourable rate. If you’ve locked in a great exchange rate prior to travel, you can then avoid any negative exchange fluctuations while you’re overseas. A travel money card is ideal if you’re on a strict budget, as you can load only the amount that you intend to spend.

Travel credit or debit cards are a great way to avoid paying foreign transaction fees while still enjoying the benefits of your credit limit or your own savings. When you use your card overseas, you’ll be presented with the option to pay in the local currency or Australian dollars. It’s usually more expensive if you choose Australian dollars, so keep this in mind when making transactions abroad.

Avoid the closest foreign exchange desk

Exchanging money at the airport can be expensive, with high rates and cash-in fees aplenty. Head to a foreign exchange away from tourist hotspots, which usually have more favourable rates, or arrange your Foreign Cash before you leave home, to avoid the hassle.

Don’t forget to factor in tipping

Living in Australia, it’s easy to forget that other countries have a tipping culture and you may omit this from your budget. Different countries have different customs, but generally, a tip of 15-20% is customary, particularly travelling to destinations like the United States. When planning your travel budget, factor in a generous amount for tipping so that you’ll always be prepared. If need be, withdraw cash at your destination so that you’re ready to tip.

With this advice in mind, you might be able to save up some extra cash to spend while you’re overseas. You never know what you can achieve in a new country with new experiences before you!

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