Planning your finances is a hugely important part of planning for any trip and it could make or break what is supposed to be a once in a lifetime experience. Here are a few tips to help you keep your finances in order before and during your travels…
Insurance
Spend a little up front and save a fortune if things go wrong. If you travel outside the European Union, the cost of receiving medical treatment could be extortionate. If you were to break your leg in the USA, for example, it would cost approximately £22,000 for treatment. Shop around for the best deal on 12 months cover, as prices for an 18-year-old male range from £110 to £435, but regardless of how much you pay, it will still be much less than you’ll pay in the event that you need treatment.
Keep a copy of your policy to hand on your travels and check with the insurer that you are covered for whatever treatment you need prior to receiving it.
The Post Office has some of the most competitive rates.
Prepaid currency cards
These are a useful way of helping you to keep track of your finances, as well as giving you much more favourable exchange rates in foreign cash machine withdrawals. To use a pre-paid currency card, you will need to open an account, and transfer money on to the card. A transaction fee is applicable, but the average charge on transactions/withdrawals is 1.5% compared to an average of 2.5% on debit cards.
Credit cards
A credit card is a must for travelling abroad. Not only are they more likely to be accepted, and often allow you to access cheaper currency, they are ideal if the worst should happen and need some extra cash.
MasterCard and Visa are more likely to be accepted globally than other cards. Many companies will charge you a hefty commission for using your card abroad, but some cards, such as the Saga Platinum card offer no transaction fees on foreign transactions, as well as 0% interest for nine months.
Credit cards can actually help you fund your travels. For many, saving enough cash for a round the world trip is very difficult, so we have to look to shorter-term funding options – loans, parents, etc. Totally Money has a tool that can show you the cheapest way to borrow if you’re short on money. Check out the tool here. It might tell you that a credit card is not only a great way of accessing cash while abroad, but with 0% interest rates, it may also be the cheapest way to fund your travels.
Travellers’ checks
If you plan on travelling for a reasonably long time, you will no doubt need to carry a lot of money with you. A safe and convenient way to do this is through travellers’ cheques. If you find yourself in the middle of nowhere without a cash machine in sight, travellers’ cheques will be able to aid your rescue.