This piece on how to save money on travel is by The Treasurer from Team Monevator. Check back every Monday for more fresh perspectives on personal finance and investing from the Team.
Since joining the corporate world, I’ve spent less than I’ve earned. It comes naturally to me, as does a desire to save 30-50% of my net income each month.
Even when I do spend money, I aim to get as much value as I can. I avoid impulse spending. I don’t buy the latest gadgets or the most expensive phone.
Being an avid reader of Monevator, I know I’m not alone in this philosophy!
Yet I wouldn’t consider myself a tightwad. There’s a balance to be had between becoming financially independent and enjoying your prime years.
For this reason, I mainly focus my frivolous spending on one thing – solo travel.
At this point I should acknowledge that solo travel isn’t for everyone. That’s why I’m not going to suggest it ‘broadens the mind’, or helps you ‘find yourself’. Such comments can be rather tiresome.
Yet for me, the more I travel, the more I convince myself that it’s one of the best ways for me to spend my money. In terms of the cost to enjoyment ratio, nothing comes close.
Cheap accommodation…
As you can probably guess, my idea of travel isn’t five-star hotels or first class plane tickets. I’m more of a budget airline, bargain hostel type.
Happily, while I’d probably enjoy a few nights in a luxury resort, one of the big draws of travel for me is meeting people and sharing experiences. So I don’t see opting for a hostel over a hotel as much of a compromise.
Luckily, hostels are generally cheap. I’ve stayed in tonnes of them across six continents, with prices ranging from £5 to £25 per night, depending on the country. To book I typically use Hostelworld, but I often check with a hostel directly to see if they can give a discount.
If a shared room isn’t for you, many hostels offer cheap private rooms, too.
When I say I stay in hostels, many people flinch at the thought. Yet stay in a hostel with a good rating (at least eight out of ten on Hostelworld or TripAdvisor) and I’m confident any negative preconceptions will vanish.
That said, I won’t criticise anyone who opts for a cheap hotel or AirBnb instead.
…and bargain flights
As for getting there, I use scraper services such as Skyscanner. I play around with the ‘whole month’ option to maximise the chances of a deal.
If I’m unsure about where to travel to – or if I’m in a bargain-hunting mood – I’ll often select the destination as ‘everywhere.’ This shows the cheapest places to fly to in any given month. It’s led me to a £20 weekend return to Timișoara, Romania, and a £30 trip to Bydgoszcz, Poland. (A hidden gem!)
If I’m planning a long trip, I’ll look into open-jaw flights. This involves flying into one airport and out of another.
Open-jaw flights often don’t cost any more than a typical return ticket. And they can save the need for backtracking, which can save both time and money.
Google Flights is good for playing around with open-jaw options. Use its ‘multi-city’ drop down box.
More tips on how to save money on travel
With the biggies out of the way, here are eight more personal finance travel tips to help you save some dollars, dinar, or dong when you next go abroad.
Get yourself a top travel card
If you use your normal debit or credit card while abroad, you’re likely paying for the privilege. Many cards charge a non-sterling transaction fee every time you use your card – typically 3% – as well as charging for overseas cash withdrawals.
To avoid these hefty fees, bag yourself a specialist card with no extra charges when you use it abroad.
If you’re happy to open a new bank account, Starling Bank doesn’t have any fees for spending on your card abroad. It also offers fee-free overseas cash withdrawals. You can make six withdrawals or withdraw up to £300 each day. That should be sufficient for most of us.
Alternatively, Virgin Money’s new ‘M’ account offers fee-free overseas usage, with no spending or overseas cash withdrawal fees. As an incentive, it’ll give you a £150 Virgin experience day voucher if you switch to the account.
If instead of opening a bank account you’d prefer a credit card, then Halifax Clarity (19.9% rep APR) offers fee-free spending and withdrawals overseas. Plus if you use the card within 90 days, Halifax will pay you a cool £20. You will have to pay daily interest on cash withdrawals though, so it’s best to spend on the card if you can.
Barclaycard’s Rewards Visa (22.9% rep APR) also offers fee-free spending and cash withdrawals. Plus it pays 0.25% cashback on most spending.
If you do opt for a credit card, always, always set-up a direct debit to repay your balance in full. That way you avoid paying interest on purchases. If you don’t, you’ll wipe out any savings you make from using them abroad.
Bag a free GHIC for European trips
You can get a Global Health Insurance Card (GHIC) provided you live in the UK. Holding one entitles you to the same medical treatment in public hospitals as a normal citizen living in the EU. If you fall ill while on a European trip, having a GHIC in your pocket could be a literal life-saver.
Applying for a GHIC is free. If you haven’t already got one, you can apply on the NHS website.
The GHIC is a replacement for the old EHIC (European Health Insurance Card), introduced as a result of Brexit. If you already have a EHIC then you can continue to use it until it expires.
Having a GHIC does not necessarily mean you’ll receive free medical treatment abroad. Some EU countries require citizens to pay for medical treatment. Having a GHIC only entitles you to hospital access at the same rate as locals.
That’s why the GHIC shouldn’t be used as an alternative to travel insurance. Which leads me to the next tip!
Get good travel insurance
Travel insurance is often seen as a grudge purchase – a necessarily evil. But heading overseas without travel insurance is like driving without a seat belt.
Anyone can have an accident while abroad. Say you get run over in a country with extortionate prices for medical treatment, such as the USA. If you don’t have travel insurance, you can forget about retiring early. You could instead face financial ruin.
The good news is that travel insurance can be relatively cheap, especially if you travel often and opt for a multi-trip policy. There’s no set policy that’s best for all. Use a price comparison site to compare the options.
Treat yourself to a free airport lounge pass
While not for everyone, the American Express Gold credit card gives two free airport lounge passes to cardholders. You can use these at more than 1,300 lounges across the world.
While not as luxurious as special airline lounges, they do provide a pleasant place to sit as you wait for your flight. You’re often treated to free food and drink, too.
The card also gives ‘Preferred Rewards Points’ as and when you spend on the card. This includes a 20,000 bonus if you spend £3,000 in your first three months. The card has a £140 annual fee, but the first year is fee-free. You don’t have to pay anything if you cancel before the anniversary of the first year.
As with any rewards credit card, set up a direct debit to pay off your balance in full each month. That way you can avoid having to pay extortionate interest. (56.6% rep APR variable).
I’ve used this deal myself and found it straightforward. For anyone flying out of London, the Luton lounge is a lot nicer than its Stansted cousin. You can visit Lounge Review to compare lounges.
Always pay in the local currency
When overseas, you’ll often be offered the chance to pay in pounds instead of the local currency. While this may seem like a kind offer, it is really a wheeze known as ‘dynamic currency conversion.’ It means the overseas retailer does the conversion for you, often at a terrible rate.
As long as you have a specialist debit or credit card, you’ll be far better off using that to pay in the local currency instead.
If you need cash, use a comparison tool
I’m a fan of going cash-free wherever possible. If I need cash – which can be near-unavoidable in some countries – I’ll use my Starling card to withdraw foreign currency while overseas. The biggest challenge is finding an overseas ATM that doesn’t charge.
Many people do prefer to have a wad of foreign notes in their wallet before heading away. If that’s you, don’t make the mistake of defaulting to your local Post Office. Instead use the services of a travel money comparison tool that will list the most competitive rates.
MoneySavingExpert’s TravelMoneyMax is the best one I’ve come across.
Plan your car hire
If you need to hire a car while abroad then it’s cheaper to book early, rather than paying at the airport desk.
It’s also worthwhile to decline any top-up insurance you’re offered when you collect your car. Instead sort this insurance out yourself through a separate policy to save money. MoneyMaxim is a popular service for this.
Consider a frequent flyer scheme
I’ve done the maths and joining a frequent flyer scheme isn’t worth it for me. I hunt down budget airlines and jump on promotional airfares as and when they arise, regardless of airline.
However if you often fly a particular route or you stick to one airline for whatever reason, do take the time to look into some frequent flyer schemes to see if you can rack up some air miles.
Research is the way to save money on travel
While I hope the above travel tips will be useful to the health of your wallet or purse when you’re overseas, the number one rule of planning the trip is to research before jetting off.
For instance, knowing the best way to get from the airport to your accommodation can be a real time and money saver.
I usually ask myself the following questions:
- Does Uber (or another taxi app) work in the country I’m flying to?
- Does Uber work from the airport? Or do I have to walk out of the airport onto a public road?
- Is the public bus or metro from the airport easy to use?
- Does local transport accept card payments?
- Are there any common scams to be aware of?
While you may think these questions are simplistic, I once had a friend visit me in London who decided to jump in a black cab from Gatwick Airport to central London. I heard similar stories of a couple getting a £100 taxi from Reykjavik airport to downtown. (Iceland can be notoriously expensive).
Other cost-cutting tips to bear in mind include heading away during off-peak times, traveling to places that don’t require a costly visa, and planning your accommodation in advance to avoid having to fork out for the last empty hotel room in the city.
If you’ve any tips I’ve missed or you’ve employed any of the above with success, then I’d love to hear from you in the comments section below.
You can see all The Treasurer’s articles in their dedicated archive.
Nice post, thanks.
Like you, I would consider myself a ‘value’ traveller, much preferring a camping trip, somewhere walking or YHA stay and doing everything myself independently, compared to, say, two weeks in a 5* resort somewhere.
While I love the idea of popping off to somewhere for a weekend on £30 flights, for environmental factors, I am hoping the era of cheap flights is over and would definitely prefer to get the train somewhere, even if it takes a little longer, but is also a more pleasant experience and a nicer journey. I’m not sure when I’ll fly again, but haven’t for nearly three years now (pandemic obviously playing a big part in that of course, but just haven’t felt the need to jet off somewhere when there is still so much of the UK I haven’t seen)
Sadly the economics of long-distance train travel are way behind that of flying still, but I think it is positive that more overnight sleeper train routes in Europe are starting to emerge, although they are a far dearer option that a quick flight. Then you look at the cost of UK train travel and accommodation is often far more expensive than the equivalent abroad. I do feel very conflicted, balancing my desire to travel (again), balancing this with the enivormental factors and overarching all of this is the desire to save 30/50% towards early retirement freedom (and lets be honest, a reason for that goal is to do more of the cheap travelling, for longer).
The research point is a good way. Time=money and all that. Sometimes I’m happy to pay for the convenience, but usually not. A few moons ago I worked in UK tourism – one of my biggest bugbears was the Gatwick Express train and the cartel of airlines selling tickets for that to unsuspecting tourists on arrival, when the ‘normal’ Southern Rail option is available, half the cost (and some) and only a few minutes slower.
The big problem at present for this kind of travel must be COVID19. Me & Mrs C had been spending a month per year in South America but many of those countries are suffering badly, with non-existant vaccination and very stressed health services.
Nevertheless, interesting stuff. A big money saver can be engaging with the locals in their own language; we can have a decent go with Spanish (and French, maybe German) which has earned as free food/wine, discounts here and there, entry into “not open today” places plus of course increased value in the whole experience. Perhaps my Portugese in Brazil was not the finest although no international incidents resulted… attempting Quechua was hard work.
For lengthy periods, specialist cloths are a must. Sure the archetypal traveller is in jeans/tee-shirt/trainers but much better are the ultra-lightweight, warm/cool, odour-eating, insect-repelling, UV opaque togs, that wash/dry in 2 hours in your room – no need to leave unattended or get ruined in “24 hour cleaners”. If you are somewhere long enough, buy local clothes and blend in. One of my memorable experiences was being asked directions, and my being able to answer (not in English).
But COVID19… sigh. Even European travel seems a risk.
A thorough examination of every cost except the most important one. That’s paid for collectively (including the 90% of global population that can’t afford to fly) and not individually, so who cares, right?
Good advice! I’m looking to go away at the end of the year (hopefully) so I’ll make sure to refer to this article.
So judging by the climate activists blocking the M25 and breaking into Barclays bank, climate change seems to be a thing.
Anybody think burning fossils fuels in the upper atmosphere might you know, possibly, cause global warming?
Just because you can fly to Timișoara for £20 and Bydgoszcz for £30 for the weekend, doesn’t mean you actually should.
Fact: 1% of people cause half of all global emissions from aviation, https://www.theguardian.com/business/2020/nov/17/people-cause-global-aviation-emissions-study-covid-19
Really just think before you consume. Just because it is cheap doesn’t mean there isn’t a cost. It’s just that someone else is going to pay for your greed.
Well I enjoyed the article and am looking forward to flying again. I haven’t seen my folks in 2 years, missed my grandmother’s funeral so would like to pay my respects.
I do think the days of cheap flights will be ending (more because the airlines want to make money than to help the environment) but it’s rare I go for such deals in any case.
Also +1 here for using Starling whilst abroad.
Thanks for the article @ The Treasurer, nice to hear your tips. We travel (when we can) and have since we were married in 91, my partner several years before that.
We think of ourselves as responsible travelers, using local (to the country we visit) operators and booking them directly when we can from home or winging it and finding them on the ground when we arrive. We try to use operators that have a environmental side to their marketing (no guarantee that it is Eco, but more chance). Travel on the ground is by bus or train by preference.
At home we eat a vegetarian diet and keep a cold house in winter in comparison to many of our countrymen. We have a policy of making things last, especially clothes by buying quality new and second hand. Yes we fly, but we offset in other areas of our life.
It is easy to espouse that everyone should be responsible for the planet, but the fact remains that the majority will not unless they cannot. To achieve that, taxation and legislation seem to be the only levers that work in a free market economy. I only have to stand in my village with a speed gun to see the proportion of people who would behave responsibly, when the safety camera van parks up it catches more locals than visitors. The effects of the van are very short lived. I argue therefore that it is the responsibility of government to enforce or tax irresponsible use of air travel. It has already looked into doing this but I doubt it will while the travel industry is suffering from the pandemic.
We tend to preload a money card via an app when we travel and keep a credit and debit card separate in case of robbery or a card getting stopped – a very infrequent occurrence in our experience- but having no money on an island with one bank and one ferry off that only takes cash because the bank didn’t believe me when I told them I was going abroad taught me to keep as many options as I could. I have lost many hours persuading my bank I still have my card while abroad – mainly in less visited areas, most inconvenient.
JimJim
@all — Yes, I’m as environmental as the next half-willed Guardian reader — I actually eschewed short-range flights for holidays for about five years in the early 2000s, before I accepted that absolutely nobody else I knew was doing it (in fact they were flying more) and that I was only going to live once — and I agree there’s big ethical question marks all over this space.
I’d love to see heavier taxation; ideally allied with some kind of ‘flying credits’ where everyone is allowed (say) one take/off landing per year and after that they have to pay for more, while if you don’t use yours you get a rebate every year. A tiny number of people (some of my close friends among them) are responsible for the majority of all the flights, and should pay for it.
However with that now said let’s please leave further comments on this article to the subject of traveling cheaply.
I’ll likely delete off-topic environmental / comments from here. The point has been made and it’d be more useful/relevant for this blog’s audience for this page because a useful resource on the subject of cheaper travel rather than an Internet slanging match.
I’m sure some readers will have their own tips et cetera? 🙂
Good article and thanks for the GHIC reminder, we must get these.
Regarding interest on cash withdrawals from the Clarity card, I avoid this on my Santander Zero card by putting the card into credit before we travel.
Often worthwhile investigating foreign SIM cards before you travel. You can sometimes get them on ebay before you go.
@Naeclue, if you already have an EHIC that will remain valid till its expiry date after which you need a GHIC. Somewhat less coverage post-Brexit but Switzerland got included last week so there is hope.
While it overlaps into @TI’s unwanted environmental discussions, it really is a pity that pricing on flights has been more competitive than any more climate-friendly alternatives. I don’t think the industries can do anything about that, it results from taxation and incentive policies from all the governments involved.
Travel cards – any thoughts on the Revolut and Transferwise (and the like)? I’ve been using Revolut on trips due to the decent FX rates and overall pretty happy with it, although customer service is a bit meh if you have issues, but I haven’t looked into the options written here!
A second vote for Revolut. Found it useful to be able to keep different currencies. There app has a function to freeze your physical card if you need to. Also like their disposable (one time use) online debit card.
As I have to travel for work, I’ve already done several journeys, clutching QR codes as I go.
One tip: EU countries now seem to stamp UK passports as you go in and out – having queued, horribly, in the non-EU queue. If you have to travel a lot, this means you can get through your passport very fast. Two stamps takes up at least half a page. So if you think this might be an issue, at least pay for the 55-page version the next time you renew.
I also tried asking the border guard to use existing space on a page last time I went in, and he kindly obliged.
Nice article @thetreasurer. As an FI graduate on a modest income with a taste for solo travel and adventure I spend a substantial amount of my disposable income on solo travel. I have written an e-book on the subject (a lockdown project), but typically have shelved it. Perhaps it’s time to dust off it’s digital cover and it. I use a mix of homestays and private room in hostels and will usually end my trip with a reasonably priced hotel stay for some pamperering before the trip home. As a curmudgeonly old git I like my privacy and sleep!
One tip I can offer readers is to invest in a GoLocalMe for worldwide 4G data coverage. This has been a great investment as I don’t have to worry about trying to secure a decent local SIM card when I arrive. I’m sure I don’t need to lecture seasoned Monevator veterans on the perils of misusing mobile phones abroad. Readers can also expect a slow eroding of European roaming rights over the co I got years too.
The initial outlay is a little expensive, I have the GoLocalMe G3 which I bought for about £150 a few years back. There is a newer G4 which is slimmer and lighter but doesn’t offer as much portable battery power as my G3 and as I’m usually carrying an iPad mini the extra is worth the weight.
You can buy a variety of data packages for both world regions and global use (it comes with 1MB of global data) and is a roaming package so you are always on the best network. All very reasonably priced with outstanding customer service from Hong Kong. Currently they are only on sale via Amazon.
I think, many travellers from the U.K. are surprised how restrictive it can be to buy a SIM card in another country, even in Europe. We are very liberalised here in the U.K., which I think I is under appreciated by it’s population at times.
I’ve even used it as an emergency WiFi back up here in the U.K. when my eldest son was having to do his final uni exams at home during lockdown. Again, the customer service from Hong Kong was second to none and they were quick to help with a payment issue (I had €5 credit left over from an India trip in 2018 I wanted to use).
Just a reminder to readers, the G3 is a portable WiFi router and is only suitable for data. It does not make ‘traditional calls and texts. But it isn’t perfectly fine for WhatsApp and FaceTime calls. Also there are cheaper portable WiFi routers out there for those on a budget.
A final analogy: in 2018 I spent three weeks solo travelling around Southern India, a richly rewarding experience, I was using a Post Office credit card which had decided to block my card as I was about pay my hotel bill. I called, got through and sorted it. All perfectly fine until I got the £30 phone bill for the call. A terse call to the credit card folk soon had that repaid! Like @thetreasurer I now use Starling Bank and a Halifax Clarity card. Both have in app communication methods. I also, always have £300 (or sometimes in USD) in cash on me (for emergency use) and an extra £50 to exchange at the airport as I have yet to arrive at an airport for an adventurous destination only to discover the cash machine next to the FX booth ‘strangely’ not working!
Safe travels,
Dave
-I think, many travellers from the U.K. are surprised how restrictive it can be to buy a SIM card in another country, even in Europe. We are very liberalised here in the U.K., which I think I is under appreciated by it’s population at times. –
Yes, getting a sim card in Italy requires I.D. and your tax number (Codice fiscale). If you lose or have it stolen, you’re expected to go straight to the police. Meanwhile, places like the UK, Poland and Malta almost give them away for free. A department store in Malta had piles of Vodafone sim cards at the tills, 2 euros each, with 1 euro credit.
Thanks for the Glocalme tip. Re. money, I have an old childish fascination with foreign currencies, so always take emergency cash with me. We visit Tanzania every 18 months and there was a time when we wouldn’t have gone without plenty of low-denomination dollar banknotes, though these days they seem to like euros as well. I have Revolut and Transferwise cards which are amazing, but of course, a credit card as well, just in case.
Steve