Should you buy holiday money NOW as the pound hits 10-month high? | The Sun

Should you buy holiday money NOW as the pound hits 10-month high? | The Sun

SUMMER is on its way and if you're jetting off on holiday you'll need money to spend.

When it comes to buying euros, dollars or any other foreign currency, finding a good exchange rate will make your money go further.

The last thing you want to do is wait until you're at the departure gate before buying your holiday money.

You'll pay a lot more commission and won't be given the best rate.

It pays to think about it sooner – and now could be a good time as the pound is stronger than it has been in a while.

Time to buy?

The value of a currency changes all the time based on how markets feel about the strength of the economy it's linked to.

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The pound – also referred to as Sterling – has had a really good run against both the US dollar and the euro this year.

That's good news for Brits heading abroad.

Last week, the pound hit a 10-month high against the dollar after better than expected economic growth in January.

It's hard to know if that strong performance will continue.

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But economists reckon the Bank of England will keep putting interest rates up this year to battle high inflation.

Usually, that would keep the pound strong – even though it makes the cost of living rise for anyone with a mortgage or loan.

It's impossible to predict however and all the advice is to plan ahead.

Phil Barter, director at Travelex, says: "Planning your trip and currency requirements well in advance is the best way to get bang for your buck."

It comes as the pound fell to its lowest level against the dollar since decimalisation in 1971 in September 2022.

The pound started diving after the mini Budget by the former chancellor Kwasi Kwarteng spooked the markets.

His plans outlined the biggest programme of tax cuts for 50 years, costing more than £70billion of increased borrowing.

Cash or card?

There are lots of ways to spend abroad and they all have pros and cons.

There's cash, travellers' cheques, debit cards, credit cards and cards specifically designed to convert your pounds into the currency you need.

Barter says: "We would always recommend travellers take a combination of a digital product and cash.

"Doing so offers travellers both security and convenience on their trip."

While more and more places will accept digital payments, it's worth checking out whether that's the case where you're heading.

"Cash isn’t dying out and in some markets, such as South-East Asia, the vast majority of transactions are still made using cash," Barter adds.

Even in Europe and the US, cash is still used to pay for taxis and tips.

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When it comes to choosing a card, check whether it's free to use abroad as some banks charge significant fees – especially when you withdraw cash in another country.

Read our guide to getting the best deal on holiday money that you can.

Do you have a money problem that needs sorting? Get in touch by emailing [email protected]

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