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Save Money by Avoiding Card Spending on Vacation

In the current financial crisis, debt is something which we are all too aware of and many people have noticed their level of borrowing creeping up. Although unsecured debt continues to rise, consumers are realizing that some forms of debt are very easy to obtain and even easier to get into trouble with. However, it is interesting to note that spending on credit cards appears to be slowing down as people try to bring down their levels of borrowing. This makes perfect sense because many are trying to use financial products that provide the best value for money.

Spending on Vacations

One area in which consumers are definitely seeking to keep their spending under control is their vacations. Traditionally, a credit card has been seen as the best way to spend pay for things while on vacation and is certainly the most popular. There are good reasons for this, with the main one being convenience. There are also some safety aspects such as being able to get a card replaced in the event of theft or loss and also the legal protection offered by card purchases.

Unfortunately, there are also costs associated with using most cards abroad which can really mount up to become a nasty surprise when a holiday is over. Many card holders will not check the specific provisions of their card provider for using the card abroad. But all manner of additional charges and fees can appear in the small print.

The cost of using an ATM overseas can really mount up quickly, with some credit-card companies charging a fixed fee of a few pounds per transaction. Many vacationers will not be aware of this until they return home and see their statement. Withdrawing cash on a credit card often attracts a very unfavorable rate of interest, one that it much higher than the one that is applied for purchasing something at a retail outlet. The exchange rates used for credit-card transactions are also often
much worse.

But perhaps the biggest danger of using a credit card while on vacation is spending more than you planned and then finding yourself unable to cover the repayments when you return home. Credit cards are one of the most expensive forms of unsecured borrowing and so a holiday can end up costing a great deal more than it needs to. Little wonder then that consumers are looking for other ways to finance their holiday spending.

What Are the Alternatives?

Credit cards are not always a bad choice. There are a number of prepaid options on the market which allow the consumer to treat their plastic as a savings account by pre-loading their spending money on to it. This can be done in several different currencies and means that holiday makers will only be spending the actual amount they have taken with them.

Those planning a holiday should also investigate other finance options to cover the cost. Fixed-rate, reasonably short-term loans can be far more cost effective in the long run than credit cards and they help to avoid the risk of getting into unaffordable debt.

This guest post was submitted by Francesca who writes for comparison site SO Switch. If you’re looking to save money, she recommends using a comparison site to ensure that you’re getting the best deal on essentials such as insurance and energy suppliers.



  1. A good point was brought up about not knowing the terms on foreign transactions fees.
    I call my credit card company to make sure I know exactly what I should expect if I travel overseas.

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