Exchange money coins notes

To find the best deal on foreign currency try to order your holiday money online to ensure you receive the best exchange rates. In fact, if you order your holiday cash a few weeks in advance before jetting off you can actually have the foreign currency delivered to your home address. It is strongly advised that you do not buy your holiday currency from the airport, the rates are much worse than those of a high street retailer.

One of the main foreign exchange companies, Travelex, even offer an airport collection service for pre-ordered currency from the airport on the day of departure (check they definitely have a desk at the airport).

Don't be fooled by the strapline 'commission free' this does not necessarily mean you will secure the best deal on your foreign currency. If the high street Foreign Exchange Bureau companies aren't making their money through charging commission then they certainly will through exchange rates - to be certain you are getting the best deal on exchange, always check the total cost in sterling against your foreign currency amount. Here's a quick run down of charges and fees often associated with using bank cards for foreign exchange:

  • Minimum Charges - These can make it very expensive to change small amounts of money
  • Flat fee - These can offer good value if you are planning to change larger amounts of money as the fee does not alter no matter how much you are changing
  • Handling fees - This is the money the currency seller charges to carry out the exchange.

Here's a savvy guide to any foreign exchange related queries you might have, especially where charges and commission are concerned.

An increasing number of holidaymakers are becoming reliant on using credit or debit cards when purchasing foreign currency due to the ease, convenience and safety of cards. However, many people do not realise the heavy charges that often accompany the use of cards in foreign ATM's or banks. Whilst abroad, it's not uncommon for most credit card companies to charge a loading fee of up to 3% and around 2% each time you use your credit card to make cash machine withdrawals overseas. In addition you will start paying interest on your holiday money immediately so the advice is not to withdraw your holiday cash using a credit card. Debit cards are less expensive however still incur some charges when used abroad.

For example, Nationwide will not charge you for transacting in the Visa Europe Region with their FlexAccount Debit Card, however you will be charged 0.84% for transactions made outside of this region. It is strongly advisable to check with your bank before travelling to find out the exact charges you will face when using your debit card on holiday. Unlike the credit card, you will not be charged a fee for withdrawing cash from an ATM.

There are some credit card companies that cater for holidaymakers who prefer to use 'plastic' to buy their foreign currency.

Santander's ZERO Card levies no charges for purchases or cash withdrawals made overseas, however interest charges on any ATM withdrawals will occur at 27.9% per annum.

Platinum Card from the Post Office is also free for foreign spending, although do note there is a charge of 2.50% for a cash machine withdrawal.

Nationwide's Gold Card - free if used within the Visa Europe region, although you'll be charged 0.84% for the rest of the world. There will be a 2.50% fee for cash withdrawals.

If you are aged 50 or over,
Saga's Platinum Card is another recommended card for holidaymaker use within the Visa Europe region. Be aware of the 1% loading fee elsewhere in the world.

Please note: Any rates or deals mentioned in this article were available at the time of writing.