COST-CUTTING TIPS

Business Traveller offers tried-and-tested tips on getting more for your money

Discover creative ways to get more bang for your buck when on the road with Business Traveller

Do your research

The more you plan, the more you’re likely to save. “Shop around,” says Stephen Hughes, director at broker Currencies (www.currencies.co.uk). “The biggest mistake people make is to go somewhere they’re used to, and just accept that for what it is.” Keeping your eyes open can pay off even after a transaction – Travelex’s online Price Promise guarantees the best rate on the total price or the difference refunded. Register for its online Happy Hour, which sells at better rates for a limited time. You could also try price comparison websites to find good deals – travelmoney.moneysavingexpert.com has an option to search for delivery, collection or buy-back.

Avoid airport outlets

Don’t leave it until the airport to buy your currency, as you will invariably get a poor rate and pay commission – which varies from one city to another. If you do collect at the airport, pre-booking online can give you better rates.

Check credit cards

When you make a payment abroad using your credit card, you will normally be charged the daily foreign exchange rate set by Visa or Master Card plus a foreign loading fee. If you have an HSBC Hong Kong account, for example, the fee for withdrawing money from an HSBC machine is HK$20 (US$2.58), while from the Visa Plus and Cirrus machines it is HK$40 (US$5.16). Again, to reduce the fees you pay, make as few transactions as possible and take as large an amount out as you feel safe doing each time.

Use an FX specialist

Companies that specialise in foreign exchange and operate online or by phone keep rates lower than banks. According to a December 2011 report by Travelsupermarket, charges on debit and credit card transactions abroad range from 3 per cent to 6 per cent. If you buy before you travel through a broker, you will save – Currencies Direct, for example, claims to sell at around 2.5 per cent less than banks.

Secure a rate

Ensure your brokerage contract suits your needs. A “spot rate” gets you cash immediately at whatever rate is published by the provider that day. A “forward contract” fixes the rate you wish to buy at for a set amount of time – it’s used when purchasing properties abroad, as it means you’ll know exactly how much it will cost. If time is no issue, “limit orders” allow you to set the target rate you want to buy at.

Know your broker

Good rates can be fleeting, so make sure your broker has you on speed dial. “The more information we have leading up to when you need to make a transaction, the more we can help,” says Alistair Cotton, senior analyst at Currencies Direct. Online broker Fair FX sends out newsletters when the rate moves significantly.

Be your own broker

Cotton says: “The news effectively drives FX. For instance, if Spain is in trouble, [it may be] a good time to buy euros. If it’s a good rate, go for it every time.” Travelex’s online Travel Rate Tracker monitors currency movements and you can set email alerts at a preselected date or rate threshold.

Strike a balance

Estimate how much day-to-day cash you will need to avoid returning home with a wallet full of currency. However, if you travel somewhere regularly, you may be better off exchanging too much – some FX companies offer free buy-back if you change over a certain amount (otherwise, changing currency back is not worth it). Change too little, and you may be forced to put charges on your card unexpectedly.

Get an account

You might also consider opening a bank account that will help you get foreign currency. The DBS Treasures Account, for example, gives better exchange rates when changing money at the bank, and means you don’t have to pay fees for withdrawals from cash machines in Macau and China (normally HK$25/ US$3.22), for withdrawals using Visa Plus Service (normally HK$25/US$3.22), or for withdrawals from a China Union Pay service (HK$15/US$1.93). An HSBC Premier Account lets you withdraw money without paying a fee from any of the bank’s ATMs in other countries.

Get a pre-paid card

Those offered by Caxton FX, Travelex, Thomas Cook or Fair FX, which may offer better exchange rates. You order these cards and charge them up with money using your credit card online. Then when travelling you can use them to pay like a credit card or withdraw money. Because the companies are entirely online, they do not have the overheads of other currency exchange services and may offer better rates.

Change overseas

Sometimes your destination can offer better rates of exchange – check before you fly, then look for small, independent outlets for even better rates.