Biggest money mistakes when travelling

Discover the biggest money mistakes people make when they travel so you don’t get caught out.

Travel is a money pit. But you can avoid needless costs by learning from other people’s mistakes – from racking up card fees to, er, accidentally buying a yacht.

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The Finder team hit the streets of London to quiz the public about their biggest money mistakes when travelling.

We heard it all: from exchanging cash at the airport (big mistake!) to clocking up huge phone bills. So get your passports, purses and pens ready – here’s the lowdown.

The airport exchange trap

We’ve all been there. The holiday prepping to-do list is the length of your arm, you’re working right up until the moment you leave and you’ve forgotten to get any foreign currency.

But while it may be convenient to exchange your money at the airport, it’ll cost you dearly. Airport currency exchanges are notorious for offering pitiful exchange rates.

I got ripped off at a foreign currency exchange. That sucked, dude! I thought that they said £250 [in exchange] for US$300. They gave me £215. So that was the worst mistake I’ve ever made, by far!”

London student

To avoid this, compare exchange rates from different providers before you buy, ideally a couple of weeks before you’re due to go, so you have time to get your currency delivered. Shopping around in advance can save you enough in fees and commission to pay for a round of drinks when you arrive. When we checked rates in September 2023 for changing £300 into euros, we found a difference of more than £20 between providers, once we took delivery fees into account.

The card fees sting

Not all cards are made equal. Some debit or credit cards will charge you a foreign transaction fee when you pay abroad. This can be nearly 3% per transaction, which can really eat into your holiday funds. And some ATMs add their own fees on top. Plus, if any shop abroad asks if you’d like to pay in your own currency (pounds sterling), refuse. Such conversions are likely to cost you dear, as the shop will set its own exchange rate.

When I was in Malta recently, I needed to get more euros out to buy this popular fizzy drink. And I went to a cash point and it [said it was] going to charge a conversion rate. I thought it would be like the UK, where it charges you £1 to take cash out. It charged me nearly £20 to take out, like, €20.”

Fizzy drink fan

You can avoid all of this by using a debit card which has no foreign transaction fees. For example, the Uphold debit card has 0% foreign transaction fees and low foreign exchange rates.

The travel insurance trip-up

When it comes to travel, anything can happen. You could lose your luggage, have an accident or get sick.

Travel insurance is there for those unexpected situations. Overseas medical treatment is typically expensive. Research from the insurer Admiral shows a case of food poisoning in Spain could cost you as much as £2,000, while a broken leg and repatriation from the US can cost around £36,000.

Making sure you’ve got the right travel cover in place means you’ll have peace of mind (both over your health and your wallet) if anything does happen.

Money mistakes

The excess baggage downer

Many of us have a nervous wait at the airport when we gingerly place our luggage on the scales. For most airlines, if your bag is overweight you’ll have to pay excess baggage fees. These can be costly and start your holiday off on a low note.

Be especially careful with budget airlines. The weight restrictions are typically lower than with other carriers, at 10kg to 20kg, which can catch people out.

In recent years, airlines have also started tightening their baggage policies around carry-ons, meaning you can only take 1 handbag-sized piece into the cabin for free.

The roaming-charge shock

Phones and travel go hand in hand now. Whether you’re using your mobile to check your train or uploading your holiday pics to Instagram, you don’t want to come home to find your phone bill has gone through the roof.

Roaming charges are tacked on by mobile networks when you use your phone overseas. It’ll depend on which network you use and which countries you visit as to how much it’ll cost. It can be very easy to get caught out, especially if your network no longer offers free EU roaming.

I forgot to switch my phone from a cell to a Facetime video, so I racked up a US$200 international calling bill.”

Borough Market browser

It’s best to check your network’s policies ahead of your trip. You may have roaming included in your plan or be able to buy an add-on to cover your holiday.

The missed buy-back guarantee

How many times have you come home from holiday with some cash left over? If you fail to spend your very last cent when away, you’re typically faced with some pretty poor exchange rates when you try to change your holiday money back into pounds.

However, some currency exchange companies let you lock in the exchange rate you bought at – known as a “buy-back guarantee”. So when you return from your trip, you’ll be able to sell your unwanted dollars or euros back at the same rate. And in some cases, without any of the usual commission fees.

And…the yacht

Not so much a common travel money mistake as a story we couldn’t resist sharing. We appreciate the sage advice of this member of the public.

I decided to buy a wonderful ocean-going yacht. This was 2008, and I realised [it] was a bad mistake…after 2008, nobody was buying yachts. So eventually, after about 4 or 5 years, at last someone came along and bought it for £100,000 less than I had bought it for!”

Yacht lover

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