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There are
many ways of spending money overseas including
travelers cheques, currency cards and cash but the
most popular way to pay for those mouth watering meals
and that “just got to have bargain” is with your
“plastic”. But
which cards should we be using?
Money
Saving expert Martin Lewis has just produced a report
highlighting those cards that we should and should not
be using. The
banks are changing their criteria all the time but at
the moment the best card to use is the Abbey’s Zero
card as you get the best rate of exchange and it cost
nothing to use. Another good one is the Nationwide
debit card which has no fees attached to it at all but
you do need a current account with them. “In
comparison the Halifax, Lloyds, TSB or Nat West debit
cards should be avoided like the plague as you they
make massive charges for the privilege for using
them” claims
Lewis.
The
banks are able to make four
charges in general, these being:
1.
Bank
commission (or foreign loading fee) which is
applicable to both debit and credit cards, typically
2.75% or £2.75 per £100 transaction.
2.
Cash
withdrawal charge, usually 2.5% or minimum of £1.50-£3
per transaction.
3.
Penalty
for Spending Fee – simply a charge for the privilege
of using your debit card overseas, not applicable to
credit cards. (up to £1.50 per transaction)
4.
Unexpected
Interest – a hidden charge applicable to credit
cards only. If
you withdraw cash some card providers will charge
interest from the day you withdraw the cash until it
is paid off.
If you
are intending on using your card, and this is often
the safest and most convenient way to spend overseas
it is always wise to take some local currency with you
and the best advise here would be “do not buy it at
the airport”, you are a sitting target and tied to
their exchange rates.
Be warned that they will advertise their rates
as “commission free” but their commission will be
built into the exchange rate they offer which will be
poorer than a “high street” rate.
Happy
Holidays!..............
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Fiesta, Menorca 21 June
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