Smart spending when abroad

It is inevitable when we go abroad on holiday we will spend money.But being prepared before you go can save you money. Some cards offer no fees or commission on foreign currency or purchases abroad and even free travel insurance.

If you're heading overseas, European or International for a holiday or a business trip, you may want to take a credit card. As it can be a convenient way to carry money, widely accepted, and can be useful in an emergency. But did you know that the credit card you use every day might not be the best option?

Most credit cards will impose extra fees and charges for foreign transactions, so whilst away buying goods and using services abroad, on your return you will see things were not as good a deal as you first thought! If you are a regular traveller, it could be worth considering a credit card that offers a good deal on foreign spending.

Most card firms levy two charges for overseas transactions. The loading or conversion fee applies every time you use your card abroad and can be as high as 2.99%. Then there can also be a withdrawal fee if you take cash out of an ATM with your credit card. The withdrawal fee is either a flat rate or a percentage of the amount withdrawn, up to about 2%.

But, there are a number of credit cards out there that either don't levy these fees, or charge less than the average, so with some forward planning they can be a better option for your holiday or business trip abroad.

Overseas spending cards can be a cheap way to buy goods and services abroad, but when you can you should avoid withdrawing cash from a foreign ATM on your credit card. You will almost always have to pay a cash withdrawal fee. Also, the interest rate on cash withdrawals tends to be higher than the rate on purchases and balance transfers – and most people don't realize you start to rack up interest immediately as the interest-free period does not apply to cash withdrawals. So it really can be a costly way to get some cash.

There are alternatives too, for those who do not want to take a credit card, there are pre-paid currency cards, which work like a pre-paid gift or phone card. You basically load the card with currency before you travel and then spend or withdraw cash as necessary.

It's of course safer than carrying cash: if you happen to lose your card, your issuer will cancel the old one and send a replacement. Pre-paid cards are also easily accessible – almost anyone can get one, whether or not they have a good credit history. So they are a good option if you need your money in a hurry.

BUT please make sure you understand the card you are getting and the charges that are imposed and interest free periods.You can search on the internet for best cards for use abroad and many companies offer a comparison service to help you.

HAPPY SPENDING