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Avoiding your holiday’s hidden costs

Don’t let the hidden costs that crop up while you travel overseas break your budget. Here are our seven biggest watch-outs to keep an eye on.

3 minute read

Planning a holiday takes a lot of work. And even the keenest of planners can miss a few of those little hidden costs that crop up while you travel abroad.

Here are our seven biggest watch-outs, and how to avoid letting them break the budget on your overseas trip. 

1. Not doing your research

Researching how much things cost before you go overseas is a great way to avoid the hidden costs of a holiday. Things like planning how you’ll get from the airport to your accommodation ahead of time - or looking into local tipping customs - can save a lot of stress, awkwardness, and money. With the right research, you’ll be in a better position to negotiate than the average tourist.

2. Currency exchange rates

If you’ve been bitten by the variance in exchange rates offered at different locations, you’ll know how quickly they can add up. Sorting your currency at home before leaving often sees much better rates than changing it at the airport exchange or overseas, so a little planning ahead here can make a big difference.

3. Losing track of what you’re spending

What looks like a bargain at £40, might seem like more of a disappointment when converted back into NZ dollars. When you’re spending money in a foreign currency, it can be easy to lose sight of how much things actually cost. Use a currency converter to help you get an idea of what you’re spending in NZ dollars.

 4. Foreign transaction fees

Foreign transaction fees, or FX fees, are the conversion fees that are added to your statement whenever you make a debit or credit card purchase in a foreign currency. Even with FX fees your card purchase may not be as expensive as other options, including cash if you end up bringing leftover notes home and have to convert them back! 

FX fees can be hard to avoid, but one tip to minimise costs is to pay in the currency of the country you are in when you are travelling whenever possible, so that your credit card network handles the conversion, as that is often the better rate. 

Alternatively, having cash in the local currency on hand could see you save on transaction fees. However, how much is saved depends on where you change your money and whether you have the additional cost of converting back any money left over at the end of the trip. 

5. Get things sorted at home

Before you shoot off on your overseas travels, make sure you’ve got things sorted back at home. You can set up automatic online payments for any bills that might be due while you’re away, or sign up for automated text or email alerts, to let you know your account balances and remind you when any payments are due.

Take a minute to take care of those few little things before you go, and the only thing you’ll need to think about when you get back is where you want to travel next.

6. Using ATMs?

International cash machines can be accessed by Visa and Mastercard cards and may offer better exchange rate conversions compared with other options. However, the amounts you withdraw will attract the currency conversion fee, an overseas ATM fee from your bank, and foreign ATM banks may add their own single fee on top of that, making many small withdrawals expensive.

 7. Stay safe

While travelling with cash has some benefits, keeping it safe, having the right amount on you at the right time, or losing it on your travels can interrupt or ruin your holiday. If you are travelling with a card you have the peace of mind of know knowing it can be replaced, and fraudulent transactions are generally covered.

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