Foreign exchange tips for your next big holiday- Don’t let the ‘fun’d stop!
Whether you’re looking to make the most of your kids’ summer vacations or simply escape the heat, a holiday is always a welcome break. No matter where you’re headed, one of the top concerns on your travel checklist is bound to be ‘foreign currency’.
Let’s face it – Holidays can put a dent in your budget. So why not spend some time researching your options so you can save as much as you can on foreign currency conversion, while still being able to conveniently manage your finances abroad.
Souqalmal.com rounds up some foreign exchange tips so you can enjoy your upcoming holiday, uninterrupted.
How to Access Foreign Exchange
Here are three conventional ways you can access funds while you’re abroad:
Your credit card may be a convenient option for making purchases abroad. But it is important to be aware of the foreign exchange fees on foreign transactions, which could range anywhere from 1% to 3% depending on the card issuer. You should also avoid using your credit card for cash withdrawals, as this will incur heavier fees. Most reward credit cards in the UAE also offer higher reward points, cashback, or miles on foreign transactions so that can help balance the conversion fees too.
-Prepaid single or multi-currency card
Prepaid travel debit cards can be loaded up with the currency and amount you want, right here in the UAE before you travel. These cards are currently being offered by some of the biggest exchange houses and banks in the country. They can also be used to withdraw cash from ATMs abroad and can be managed through dedicated mobile apps, online banking or IVR over the phone.
If you’re more comfortable carrying cash, it might be a good idea to do some research about where you can get the best deal on conversion. Exchange rates vary across exchange houses, so be sure to check a couple before you take your pick. In fact, some cash is always good to have even if you’re planning to use a credit or debit card for the bulk of your expenses.
Tips for Managing Your Money Abroad
Planning ahead and sorting out your foreign currency well in advance is essential to enjoying a worry-free holiday. Here are a few tips to help you efficiently and securely manage your funds while traveling.
-Avoid the last minute rush
You may not get the best deal if you leave your foreign currency planning to the last minute. Carefully compare the processing fees, conversion fees and exchange rates related with each option to find a mix that suits you best.
-Dodge high exchange rates at the airport
Airport exchange rates are known to be significantly higher than average market rates. Limited competition and higher operating costs, all contribute to higher conversion rates at airports. Go down this road only if it is an absolute emergency.
-Always have a travel money backup
While you may prefer cash to cards or the other way around, don’t depend on only one option. Traveling with a mix of two or more travel money options and having a backup option is a safe bet. Plus it can save you from getting stranded with no financial resources if your primary card or stash of cash gets compromised, lost or stolen.
-Keep your bank in the loop
If you’re planning to use your credit card abroad, it may be a good idea to inform the card issuer about this before you travel. Banks may block credit cards since suspicious overseas transactions may point towards card fraud and raise a red flag.
-Avoid ‘dynamic currency conversion’
When paying with your credit or debit card, opt to pay in the local currency. This will help you avoid dynamic currency conversion. The rate your credit card issuer offers will be more favorable than what the merchant has to offer.
-Safeguard your cash and cards
Always be extra-cautious when it comes to securing your money. Stay away from shady exchange houses abroad that promise the ‘best’ exchange rate. You could end up with fake currency. Also try and avoid using public Wi-Fi to check your account balance and make financial transactions.