A new study shows that going abroad without cash could be an expensive mistake for some vacationers. The study looked at what 2,000 people across the UK who traveled abroad do when they needed to withdraw cash on holidays.
A study commissioned by being smart with your cash found that going abroad without cash was expensive for some travelers. Approximately 39% of those voted to find themselves in unexpected situations where they needed cash while they were abroad.
The most common costs include tipping, taxi fares and shopping at local or independent retailers. Traveling outside major cities can cause extra problems as remote areas in some countries may be less likely to accept cards. Furthermore, the survey found that some people who had to withdraw from emergency cash machinery on overseas travel were charged ATM fees. Those who put up with the airport exchange desk for last minute cash may be getting a worse deal than they would have been shopping for travel money and planning.
Amelia Murray, a smart money expert with your cash, said: “There are still blind spots when it comes to cash. I think it's enough for many people to have a card that doesn't have a fee, but that can be a false economy when using an ATM that is hit by a billing or poor exchange rate.
“It's not about carrying a wad of cash, it's about preparing for the moment when the card simply doesn't cut it.”
Ms Murray recommended bringing a small amount of local currency as a “cash cushion” – useful in situations where tips, public transport or cards are not accepted. She also advised travelers to become familiar with the card's terms regarding foreign transaction fees and exchange rates before departing.
Plus, it's worth checking out the amount of coverage your travel insurance offers in case your cash is lost or stolen overseas. A survey released by financial info company Defaqto in May showed that 91% of annual travel insurance and 86% of single travel insurance included cash coverage as a standard feature.
The analysis also found that over a third (35%) of single-trip policies offer cash compensation ranging from £200 to £299, while 24% offer compensation from £300 to £399.
