With holidays abroad back on, albeit with a few restrictions still in place, there are some things you should consider before putting everything on plastic. With figures showing the average Brit spends £84 per day on holiday when abroad, working out a budget pre-holiday can help you manage your finances so you don’t get carried away and land yourself with a bill that’s larger than expected once you return home.
To help you combat these additional costs, we’ve got some simple tips if you’re planning on using you credit card abroad this summer.
Avoid taking cash out
Perhaps the most important rule, whether you’re using your card abroad or you’re enjoying a staycation, is to avoid taking cash out of an ATM with your credit card. If you use your credit card to withdraw cash, it’s called a cash advance and will cost you dearly.
Not only will you have to pay a cash advance fee, but you’ll also be charged interest on the amount you withdraw – and, if you’re abroad, you’ll face a foreign transaction fee too!
Use for large purchases
Just like in the UK, if you use your credit card to make a large purchase, under section 75 of the Consumer Credit Act, you may have some protection should something go wrong. As long as the transaction was over £100 but under £30,000, should the supplier of the goods or service that you paid for with your credit card breach their contract with you or misrepresent what they’re selling, you can raise a Section 75 dispute.
Let your credit card issuer know
Avoid having your cards frozen by letting your credit card provider know the dates you’re planning on being abroad. With rising cases of credit card fraud, banks are more active than ever when it comes to stopping transactions they deem fraudulent.
Save the travel helpline number of your card provider in your phone so that, should something go wrong, you can call them straight away. Ensure you also have the relevant phone numbers for if your card gets lost or stolen.
Avoid using dynamic currency conversion
When you make a purchase with a debit or credit card, you might be asked which currency you want to pay in. Always pick the local currency to avoid the transaction taking place with a ‘Dynamic Currency Conversion’. Typically this conversion rate is much higher than the current market rate, so not only will you get an unfavourable exchange, but you’ll also get charged a foreign transaction fee too.