Managing your money for a happy half-term break

Lucky you: you and the family have plans to get away this half term; a bit of time overseas to escape the rat race. You won’t have to fret about arranging half-term activities for the kids and may even soak up some unseasonal warmth at the same time.

What’s more, if you’re careful to manage your currency and holiday budget carefully, you can reduce your stress levels even further. You’ll be able to spend more time creating a memorable trip and recharging the batteries towards the end of a long winter.

Here are five top budgeting and currency tips to help achieve half-term holiday happiness:

1. Get your currency early…

How much foreign currency you get for your pound is constantly changing, and uncertainty around Brexit has only made this more complicated.

These fluctuations can make a real difference to your holiday spending power. Our own investigation at the end of last year showed that by buying currency when rates were at their lowest in 2019 compared to when rates were at their highest, the nation would have collectively lost £3.8 billion just by exchanging currency on the ‘wrong’ day.

But you needn’t be totally at the whim of the currency market. You can ride out the waves by using a prepaid currency card to lock-in the rate when the pound is doing well.

…and never at the airport!

If you use a prepaid card, then thankfully you won’t have any need whatsoever for airport currency desks. If you need foreign currency, these are just about the worst places to go.

We found that the average exchange rate offered at airports around the UK was 19% lower than the official market rate, with some airports offering rates as much as 29% lower. To put that in perspective, if you took £1,100 in cash on holiday – the average holiday spending money among Brits – you could lose as much as £187 worth of euros each by exchanging your money at the airport. Think how many holiday treats that £187 would have paid for.

2. Beware of ‘DCC’

You’re soaking up the sunshine, perhaps enjoying a café con leche. You request the bill and the waiter asks if you’d like to pay in sterling or local currency. What do you say? The answer is to always pay in the local currency. If you don’t, and opt to pay in pounds, the merchant can define the exchange rate used to convert the transaction from the local currency back into sterling.

This sneaky charge is known as Dynamic Currency Conversion (DCC) and could be costing Brits abroad £881 million annually.

Thankfully, there’s a sure-fire way of avoiding this trap: use a prepaid Mastercard currency card. As of April last year, prepaid Mastercards are no longer vulnerable to DCC.

3. Stay on budget

We all know how easy it can be to burn through your holiday spending money. A couple of days into your trip and you might be struggling to remember what day of the week it is, let alone staying on top of your holiday budget.

But if you do have a strict budget, we have some helpful tools for you to take advantage of. Our mobile app allows you to keep track of all your transactions on the go, meaning you can check what rate you’re spending at and even buy more currency if you need to.

And, with FairFX Family & Friends Cards you can link multiple cards to your main FairFX Card and give one to each member of your family, or travelling group. You can then set their individual budget for the day or week.

Family & Friends Cards are available to anyone aged 13 years and over – great for teaching kids to work with money this half term. You can even move money back, if you’ve changed your mind or moved too much.

4. Use the right plastic

As well as locking in rates, avoiding the DCC trap and loading up cards for the rest of your family, there are a number of other good reasons to choose a prepaid card over other types of plastic.

Unlike a debit card, a prepaid card lets you keep your spending money separate from your current account. This means you can’t overspend and dip into your household budget unless you choose to do so. Plus, there is no link to your current account if your card is lost or stolen.

If you do use a credit or debit card abroad, then make sure you’re aware of all of the charges and fees. Some cards charge up to 3% when used overseas, so check before you travel.

5. Leftover currency

If you’ve over-budgeted, then you might return from your half-term break with some leftover currency.

You wouldn’t be alone: our customers using their prepaid euro card tend to return from holiday with an average of £177 of leftover currency still on it. Thankfully, using one of our cards means that leftover holiday money can be easily accessed for future trips, switched to a different currency or spent when back home. That beats having to change leftover notes and coins back to sterling, which leaves holidaymakers at the mercy of nasty buy-back rates.

By using a prepaid card you can save yourself money and hassle, and concentrate on having a great break with your family.

Order or top-up your FairFX Euro Card before you go. Lock in a great rate every time you load and manage your card on the go through our mobile app.

Order a FairFX Euro Card


Back to Blog