When you are excitedly planning a holiday, it is easy to miss the hidden costs.
Here are some tips to help you avoid them or at least to budget for the unexpected before you embark on your travels.
1. Currency exchange
As a traveller, at some point, you will need to convert money from one currency to another, especially if you travel through mulitple destinations. When you exchange money, you pay commission in the form of a rate mark-up. The amount of commission will vary depending on where you do the conversion.
If you want to avoid these charges during your travels, convert your money to the foreign currency before leaving home. Make sure that you convert enough for your needs. Many currency exchange places will buy back your foreign currency, so if you have some left over after your holiday, you can change it back upon your return.
2. ATM withdrawal charges and card fees
Using ATM’s abroad generally always incurs fees. You could be paying $5 to $10 each time you withdraw money. Check with your bank for the exact fee and whether there is any way to avoid it. Some credit cards also charge a foreign transaction fee for charges made abroad.
You may consider getting a travel money card which offer a certain number of free withdrawals up to a certain amount. Then whenever you make a withdrawal, withdraw as much as you can so that you don’t need to make another withdrawal (be careful that you don’t withdraw more than you are likely to need before leaving the country).
3. Debit and credit cards
Using debit and credit cards to make contactless payment has become second nature to us in many countries. However, we should be careful about using our cards while on holiday as card fees are one of the most frequent unexpected costs that people encounter abroad. So check the foreign purchase fees with your card provider before using it.
If you are asked whether you want to pay in the local currency or your own country’s currency, always choose the local currency as you will get a better exchange rate.
4. Baggage fees
When booking a flight, always check what the baggage allowances are before making payment. If you are required to pay for extra weight or bags, it is often cheaper to buy these extras at the point of booking. Then optimise your allowance by packing your cabin and check-in luggage up to the limit allowed; do not exceed your allowance or you will find yourself paying a hefty fee at the airport. An electronic luggage scale is a useful device to have when packing, plus it is compact and light enough to carry around with you.
5. Getting to and from airports
Transport between airports and the nearest city or town is often expensive. Taxis often charge premium fares, especially to tourists who don’t know the typical local rates.
To avoid getting fleeced, do your research while you are still at home. Find out about what public transport options are available to you. If you must use a taxi, then make sure that it is an official service from the airport’s approved taxi rank. You could probably hail a cheaper ride if you walk a little distance away from the airport, but you are also more likely to get scammed.
6. Tourist taxes and fees
Tourist tax, though not a new thing, is becoming more common and often catch tourists by surprise when they reach their destination. It is usually a small fee that travellers pay when they stay overnight in another country.
Sometimes, tourist tax may not be included in the price advertised and you are only asked to pay it when you get there. Therefore, it is useful to find out beforehand if your holiday destination charges any tourist taxes so that you can include it into your accommodation budget.
7. Visa and departure fees
There is no way you can avoid these fees but you can plan for them. The best way is to have an approved visa to your destination before you leave home. If that is not possible and you are travelling to multiple destinations, check whether those destinations have visa-on-arrival facilities and how much they cost. Make sure you carry enough money to pay for your visas.
Some countries may charge a departure tax when you leave. If you are flying out, this tax is usually already included in the price of your ticket but in some places, you are required to pay at the airport when you check-in for your flight. Make sure that you know the exact requirement so that you can set aside enough money to deal with it.
8. Phone calls and data charges
Nowadays we are seldom without our phones or internet, so it is unrealistic to expect that we will disconnect completely when we go on holiday. Nevertheless, you could rack up a huge bill if you use your phone while abroad. One way to avoid this is to turn off data roaming on your phone and use only free Wi-Fi wherever it is available, or you could opt for pocket Wi-Fi. Your provider may also offer a data roaming package that you can purchase before leaving home, so remember to check with them.
The above are some of the things that people usually forget to include in their holiday budget. You might not be able to avoid them, but you should plan for them so that you don’t get any nasty surprises later on.