Making sure you find the best exchange rate should be a priority when planning any trip abroad. The process of comparing travel money rates can be confusing for some, so here are the main things to keep in mind.
What is the exchange rate?
The exchange rate is the way to calculate how much of one currency you will get in exchange for your own currency. For example, an exchange rate of 1 would mean that for every one pound sterling, you would get one euro. A rate of 1.2 would mean that for every pound, you would get 1.20 euros.
When comparing holiday money providers, look for the exchange rate which gives the highest pound to euro or pound to dollar rates.
The exchange rate is not a fixed rate. It can vary from day to day, and even from hour to hour. This is why it’s important to shop around and compare travel money quotes from a range of providers to be sure you are getting the most for your money.
What currency do I need?
If you are leaving the UK, you will need to exchange your pounds for the currency used in your destination. UK currency is often referred to as GBP (Great Britain Pounds) for the purpose of currency exchange.
Most countries in Europe use the euro currency, although there are a few exceptions. If you are travelling to a country which uses the euro, you’ll need to look for the GBP/EUR exchange rate to work out how much currency you will be able to buy.
Travel money is available for every currency. Make sure you are searching for the correct exchange rate though, as more than one country uses the currency of the same name. Dollars are used in the USA, Canada and Australia, to name but a few, and each will have a different rate!
How to get the best exchange rate on holiday currency?
Many factors affect the exchange rate on any given day. The amount of currency you will get for your pound will vary depending on which provider you buy it from, where you buy – either online or on the high street, and even the physical location of the provider.
Money exchange companies located in or near popular tourist attractions tend to offer lower exchange rates. This is why you might be advised to steer clear of buying your currency in the airport. The captive market can mean providers get away with much lower rates!
Online or high street travel money?
Most high street banks and the Post Office offer currency exchange. However, generally, the better deals are found with online providers.
Travel money fees
As well as the exchange rate, you will need to consider fees when choosing a travel money provider. Travel money providers charge a fee for converting currency. By comparing the rates from a number of providers, you can find the lowest fee.
Be aware though that the provider with the lowest fee might not always be offering the best exchange rate! This is where online comparison can really help. You can see at a glance how much holiday money your pounds will buy and choose the best for you.
How much money should I exchange?
No-one can tell you exactly how much money to exchange. Everyone’s needs are different, depending on whether you’re travelling for business or pleasure.
Most holiday money companies will have a maximum limit on the amount you can exchange. In most cases, this will be around £2500, although some providers allow transactions of up to £7,500. If you are travelling for business or buying from suppliers abroad, exchanging a larger amount could be more cost-effective once fees are taken into account.
How do I get my travel money?
This will depend on where you buy it
Travel money FAQs
Q – Am I protected?
A – The best protection is to buy your currency from an authorised by the FCA provider or reputable and established broker. If your provider folds before you take delivery of your travel money, you will not be protected. Make sure you collect or arrange delivery of your funds as soon as possible after purchasing to avoid being left out of pocket.
Q – How to find the best exchange rate?
A –How much holiday money you will be able to buy can vary hugely from day
Q – Do I have to order travel money in advance?
A – When you choose to buy your currency is completely up to you. Buying in advance can allow you to take advantage of a good exchange rate or deal, and gives the greatest flexibility on how to collect/deliver your cash.
Q – Can I use my credit card for travel currency?
A – Yes. You can pay for your holiday money with either a credit or debit card. Be aware that using a credit card will incur fees from both the card provider AND the currency provider, so might not be the cheapest way to get your holiday money.
Q – Why use online travel money comparison sites?
A – Online travel money sites usually offer better exchange rates than high street providers. This is because of the increased competition online. The other benefit of an online currency comparison is that you can see rates from many different providers at a glance, all in one place.