A Little-known holiday mistake could cost you dearly with hidden fees, catching travelers out.
Experts warn against using credit cards for ATM withdrawals or purchasing foreign currency online. These(fee-ctas-would-be-TooHigh) could potentially disguise large transaction fees and interest charges. Despite the risks, many travelers aren’t fully aware of the hidden fees associated with handling money abroad — where these fees can essentials decide if your holiday budget gets hit or not.
One expert, LISA Khalaf from AJ Bell, stressed the importance of choosing a debit card when ordering travel money online. Instead of paying $0.02 for every transaction, avoid these costs by using a debit card, particularly if you don’t have a card that charges $0 in fees or interest. If you opt for a card that doesn’t offer these services (e.g., the BarclaycardRewards Visa), your bill won’t go up or get charged interest at all.
For example, if you use Santander’s Everyday Balance Transfer Credit Card to buy £1,000 of currency online, you’d pay a 2.95% non-sterling transaction fee plus a 3% cash fee, totaling £59.48 in extra costs. Similarly, Lloyds Bank Everyday Credit Card charges a 5% cash transaction fee, adding £50 in extra costs for the same purchase. Adding these up quickly puddles your holiday budget.
To avoid these charges, choose a card without foreign transaction or purchase fees and always pay in your home currency. With a debit card for online purchases tailored to your destination, you’d save money, allow for more flexibility, and avoid confusion.
Whether you’re using a credit or debit card for your travel expenses, unused fees or APRs can eat into your budget significantly. Avoid these costs and know your money. If you’ve got a card that doesn’t charge for foreign spending, opt for one that avoids any add-on fees.
For travelers who are short on time, order online and collect your currency at the airport. When comparing centers to buy travel money online, check both the rates and any fees or APGs you might need to factor in delivery costs.
If you’re short on time, consider visiting a local bank to place a single order for your travel expenses. Whether you do the online purchase or u purchase a pre-order card, the system ignores the fees you might incur.
Below are the options to consider:
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Debit cards abroad without foreign transaction or purchase fees:
- BarclaycardRewImports Visa – No foreign transaction fee or interest for atm withdrawals (until repaid in full).
- Halstones Clarity志强zak – No fee on foreign spending or atm withdrawals.
- MBNA Travel Cashback Credit Card – Offer a £393 flat rate for the first three months, after which the period may end.
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Prepaid travel cards:
- Revolut, Wise, and EasyFX offer options where you load a set amount of money at a fixed exchange rate, preventing hidden fees. These cards typically require proof of pre-ordering for full refund.
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Debit cards abroad with fee-free spending:
- Chase, First Direct, and Starling cards offer fee-free spending when you use them abroad, provided you show proof of their presence through your card details.
Always check the terms and conditions of your debit card and credit card before using travelers abroad to avoid unnecessary costs.
Don’t forget to factor in delivery costs and choose the option that gives you the best spending power.
For those whose budget is tight, using a preordered travel card allows you to pay when you’re ready, free of hidden fees, and gives you more flexibility for your holiday budget, especially in high exchange rate nations.
Note: If you’re tasked with paying by card abroad, give the FDA a call and follow these three rules:
- You should always choose to pay in the local currency.
- Always pay in pounds, as retailers apply their own exchange rate, which is usually more favorable than the card’s.
- Avoid unnecessary fees when using a card-choice that doesn’t miss you.
Timing is everything for travel. If you want to save money and耍 your holidays smartly, always check the rates and budget when buying your travel money online, ensuring your card handles the currency conversion — which typically offers a better exchange rate than the developer’s own rates. And if you’re short on time, consider visiting a local branch to place your single order, as debit cards abroad can save you money and simplify your spending.
