The British Pound continues to have a bumpy ride against the Euro and other currencies while Brexit negotiations are currently underway. However, despite all the uncertainties surrounding the future of Brexit, undeterred UK holidaymakers are rushing to book their travels to Europe and beyond for the year ahead.
Tour operators are slashing 2019 summer package prices by as much as 36% according to price comparison site TravelSupermarket, and research by the regulator’s ATOL protection scheme found that 5.2 million people are expected to book a holiday in January alone.
For us at Caxton, it’s business as usual. Life in or out of the EU must go on, holidays must be enjoyed, and foreign currency must be exchanged. While the outcome of Brexit remains unclear, we can expect further volatility for the Pound, however you can rely on Caxton to continue providing safe, simple and good value for your travel money. There are even bargains to be had if you plan a holiday where the Pound is strong. Right now Denmark, Sweden, Switzerland, Argentina, Turkey, and India, are all destinations where you’ll get more for your money.
1) Use a prepaid card
Don’t use your bank card abroad! Prepaid cards are a great way to get the most out of your holiday money. Not only do you get great exchange rates and no hidden fees with your Caxton Card, we also allow holidaymakers 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 a debit card. Some ATMs may charge you a fee - this is not Caxton, but the ATM owner.)
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 less competitive rates and commission. Make sure you plan ahead to avoid this. Even if the rate is just 2% 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. You can follow us on social media to get market insights and overviews of currency trends, and sign up to our daily rate email alert if you have a Caxton Card.
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 Prepaid 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 prepaid 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.
Many people have questions about what might happen after 29 March 2019 when the UK leaves the European Union (EU). The political process is still uncertain, however there have been some reassurances recently around flights and visas. ABTA, the UK’s largest travel association representing travel agents and tour operators has also identified actions travellers may wish to take in advance to help avoid unnecessary future disruption in the event of a no-deal scenario. See their advice here: https://www.abta.com/tips-and-advice/brexit-advice-for-travellers