In the madness that is today’s society and political system, you would be forgiven for going on an eternal holiday.

As the holiday season has landed on us, those moving between Sterling and most other foreign currencies, have seen their buying power plummet.

If Boris Johnson is to be believed, his ‘desire’ for a hard Brexit will, and has, completely trashed Sterling, with Mark Carney echoing that point further, explaining the economy will suffer and in turn Sterling will plummet further again.

Taking £1,000 to Europe the year before the Brexit vote destabilised Sterling, meant a healthy €1,450 to pop in front of that seaside view with a refreshing glass of your choice.

Today your partying would be significantly limited to a mere €1114.

Interestingly, I was speaking to a baker in Cork at a bar two weeks ago who asked two of my colleagues why they were there. Puzzled, I stepped in, only to learn that she had not seen one English person in her bakery so far that year, whereas in previous years they were lined up in the morning.

Notably, I’m sat in Bohol in the Philippines with my family and have heard three English accents in ten days. All back packers on a budget.

On the flip side, UK domestic holiday resorts have benefitted off the back of holiday makers avoiding the hike in prices that has occurred because of the currency change and attracting foreign visitors picking up bargain holidays due to the currency difference.

A great strategy over the years I’ve had is to look at my bucket list of places to visit, and see where my currency takes me the farthest. And, believe it or not, I book that one.

I could comfortably provide good accommodation and three meals for around £100 per day here for a family of five.

Planning in advance is key for many reasons. Six months ago, faced with the potential Brexit bedlam, I preloaded my Revolut card with Dollars to then buy Pesos when I reached here, knowing the Dollar to Sterling rate would only go one way.

Some further tips might seem obvious to some, but not to others I’ve seen near me making a purchase.

When asked on your credit card if you would like to make the payment in your home currency or the foreign currency, you should always select the foreign currency.

Here in the Philippines they actually display the mark up on the screen, and I’ve had 6% many a times, but the standard seems to be 5%. A friend who runs his own currency exchange said he has often seen 10% here.

It’s a scandal of the highest order and preys on those who have no options, or who are unaware of it. Often in western countries it asks if you want to pay the ‘guaranteed’ rate, and if you are unaware what the current daily rate is, you will likely just select yes to your home currency.

Just be sure you have a credit card that’s doesn’t charge currency fees hidden in the exchange rate. Two options are Halifax Clarity and Tandem.

I don’t use these to withdraw cash but if you do, be sure to use the app to repay as soon as you can from your home bank account as they charge c5p per day per £100 withdrawn.

Ordering cash in advance isn’t just as simple as going to the bank. They will not be competitive. Travel FX as a provider are hard to beat. No commission, no delivery fees and market leading exchange rates.

Don’t stick to what you know. For example, ICE used to be competitive, but even the Post Office beat them for pre delivered money offering c13,000 Pesos more.

Consider also that when you visit certain countries they sometimes favour the actual currency. My hotel here would have given my 31,000 more Pesos for my money if I had the cash here to exchange. That’s over £480 more than ICE.

Naturally, leaving it to exchange at the airport is like sitting in a rubber boat surrounded by sharks and sea urchins.

There’s only one winner.

If you have a financial question, call 01872 222422, email info@wwfp.net or visit us on www.wwfp.net.

 

Peter McGahan is Chief Executive of Independent financial adviser Worldwide Financial Planning, which is authorised and regulated by the Financial Conduct Authority.

 

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