New tips for holidaymakers

Martin Lewis, the JC Money Mensch, urges holidaymakers going away this month not to change cash at the airport. They add seven per cent to your costs.

He says: “Those going abroad this summer need be prepared for a shock. While the cost of flights and hotels haven't risen to a prohibitive level, the cost of buying things once you're there is going to hit like Frank Bruno.

"Yet those changing their money at the airport are waving the white flag of surrender. The extra cost of the convenient pick up is hideous. While most people tripping to Europe this year will find things 20 per cent more expensive than last summer, airport changers will see their costs upped by more than a quarter. The best way to protect yourself is to sort it in advance; it can be done in seconds.”

More holiday tips from the Money Mensch:

Be careful how you pay. Pay for foreign cash from a UK bureaux on a credit card or a few debit cards (inc. Lloyds, Abbey, A&L, Barclays, Co-Op), and it will be treated like a 'foreign cash withdrawal', meaning you pay a fee of £3 plus on top. Avoid this by using another card or, with debit cards, withdrawing cash from an ATM instead and paying with that.

Pre-order for airport pick-up. If you want the convenience of airport pick-up, order your currency in advance and you get a better rate. On the day we checked, €500 cost £470 from Travelex at Heathrow airport, but only £444 by ordering in advance.

Ignore commission free. It's nonsense! All it means is you don't pay a separate fee, yet often the cost is just loaded on a poor exchange rate. Forget all such spin; the only way to compare is to ask "if I give you £200, how many dollars will I get after ALL charges?"

The ultimate deal comes from using the right plastic. Spend abroad on specialist credit card Santander Zero, or runners up the Post Office and Saga, and you'll get even better exchange rates. Most cards add a hidden 3 per cent 'load', so spend £100 worth of euros and it costs £103. Yet these cards all have a zero load, meaning they're unbeatable. Do repay in full each month to reduce interest though. Full breakdown at www.moneysavingexpert.com/cheaptravelmoney.

Watch for overseas debit card cash withdrawals. It's not just credit cards that charge a £3-ish fee when you take cash out of an overseas ATM; all debit cards except Nationwide's do too.

Avoid the cards from hell. Like most plastic, the DEBIT cards of Lloyds, Halifax, NatWest, RBS and Abbey have a 3 per cent-ish load and an overseas cash withdrawal fee. Yet these hellish products also charge a fee of £1-£1.50 EVERY time you spend, so buy something worth a fiver and it'll cost £6.50, plus the load charge. Quite simply, don't use them abroad.

    Last updated: 10:01am, July 10 2009