Spending abroad

skattili

Can anyone please explain to me. Martin suggests that the best way to spend money abroad is by using a Abbey credit card which doesn't charge for withdrawals abroad. However there is a 25% interest charged from the day of withdrawal. So surely,, even if I am paying the full amount by direct debit, the interest I am paying by the end of the month is enough to offset the saving made? or am I wrong. Isn't it better to get travel money from travelex on t price match instead. Can someone enlighten me please.

benf90

I presume you're talking about the article on this site?

This one?

http://www.moneysavingexpert.com/cards/cheaper-spending-overseas


The Abbey Zero card is recommended for use abroad when making purchases in a shop etc, not for withdrawing cash. I presume the article mentions about using it for cash just so that people are aware of the interest charges that it attracts.

If you plan on withdrawing cash from an ATM etc then you would need one of the recommended debit cards.

From the article: "To keep the cost down, primarily use credit cards for over-the-counter purchase transactions; if you'll be making a lot of ATM withdrawals, it's worth considering the top debit card instead."

I guess it's kind of easy to skip straight towards the figures and miss or glance over the small warnings that are given.

skattili

Many Thanks for the reply. This is what is actualy confusing me. I usually find that even though I am making credit card purchases, in quite a few places credit cards are not accepted and therefore I usually take with me approx 250£ equivalent of foriegn exchange with me- through travelex (pre-order + price match). My question really is - instead of purchasing this money from travelex, does martin recommend using the abbey credit card (which charges 25.9%APR) or a natwest debit card (which is not covered for fraud as a credit card is); to withdraw from an ATM? i.e it will be only be worth opening a natwest account for me if there is a significant difference in the net exchange rate I get, between travelex and Abbey credit/Natwest debit cards.
Thanks a lot once again.:beer:

SiuLoong

Probably just a typo but if you get an account with a debit card for withdrawing money abroad make sure its Nationwide!!!

I use a Nationwide Debit card to withdraw cash and a Nationwide Credit card (set up to pay full amount each month) to pay for any items I can, personally I can see no further benefit to using the Abbey Zero abroad (other than initial 6 month 0% deal on purchases) as both simply don't charge you for using them abroad. Post Office credit card is an alternative to Nationwide, but if you were applying for a Nationwide current account anyway why not apply for their card at the same time..

I have heard that the rate you get withdrawing cash on a Nationwide debit card is better than that you would get at a bureau de change over here but I don't have anything to back it up, and I'm not sure.. it was just more convenient for me to withdraw abroad & I had some Euros left over from previous trips to tide me over.

Davidfield375

I remember using my Yorkshire Bank card abroad, I was getting charged over £1.50 on every transaction! My advice is not to get one of these cards.

SiuLoong

Davidfield375 wrote: »

I remember using my Yorkshire Bank card abroad, I was getting charged over £1.50 on every transaction! My advice is not to get one of these cards.

You will find this (or similar) on ALL credit cards bar those discussed above (Nationwide, Post Office & Abbey Zero).

benf90

skattili wrote: »

Many Thanks for the reply. This is what is actualy confusing me. I usually find that even though I am making credit card purchases, in quite a few places credit cards are not accepted and therefore I usually take with me approx 250£ equivalent of foriegn exchange with me- through travelex (pre-order + price match). My question really is - instead of purchasing this money from travelex, does martin recommend using the abbey credit card (which charges 25.9%APR) or a natwest debit card (which is not covered for fraud as a credit card is); to withdraw from an ATM? i.e it will be only be worth opening a natwest account for me if there is a significant difference in the net exchange rate I get, between travelex and Abbey credit/Natwest debit cards.
Thanks a lot once again.:beer:

I think the recommendation is to use a Natwest debit card rather than taking the cash.

However, for approx £250 worth I personally don't think the difference will be great enough to make the hassle of opening another current account worthwhile.

If you're a frequent traveller etc then it may be worthwhile over time, but if it's just your average yearly holiday then it may not be worth it.

I think Nationwide (and others) simply use the exchange rate given to them by Visa. Then, some cards add commission to this figure and others such as Nationwide do not.

Taking today as an example the following are the rates given on Visa and Travelex websites':

Visa: 1 EUR = 0.79 GBP / 1 GBP = 1.27 EUR / £250 = 317.50 euros
Travelex (cash): 1 EUR = 0.81 / 1 GBP = 1.23 / £250 = 307.08 euros

I think I'm right in saying that the exchange rate used for card transactions is the exchange rate on the day that transaction debits the account, not the exchange rate on the day the transaction is made. So, there can be small differences in what you may expect the GBP equivalent to be if you were to calculate each transaction separately etc, as sometimes transactions can actually debit an account a few days after they're originally processed.

As you can see above the differences are quite small which is why I personally wouldn't go through with the hassle of opening another current account just to save a few pounds.

Visa's exchange rate calculation tool can be found here:

http://www.corporate.visa.com/pd/consumer_services/consumer_ex_rates.jsp

If you decide to take the cash or travellers cheques with you then there's a handy tool on this site to help you find the best deal out there, it can be found here:

http://travelmoney.moneysavingexpert.com/