Travellers rejoice! The Australian dollar is worth more than it has been in the past 12 months – and that means more money in your pocket.
A$1 is currently worth almost US0.80c; an increase of almost 10c from its lowest point in January. Our dollar is also up against other major currencies, worth around 54 pence (an 18-month high) and €0.70 (a 12-month high). It’s great news for international travellers, who can make big savings if they act quickly.
Analysts are predicting that the surge in the dollar won’t last, so take advantage of it now. Here are five ways you can get the most bang for your buck.
Choose your destination carefully
The dollar is on a high overall, but that doesn’t necessarily mean that it has improved against every currency. You’ll still need to do your research. The USA, Europe and the UK are a good option. For example, the New Zealand dollar is having a strong moment of its own, which means it isn’t great value for Australian travellers right now.
Pre-pay for as much as possible
Take advantage of the strong dollar and pre-pay for hotels, transfers, tours or onboard gratuities. Most hotel booking sites will also let you cancel your booking very close to the travel date, so if the dollar improves even more you can cancel and rebook at the new rate. As many cruise lines charge in US dollars you can make some real savings if you plan ahead.
Lock in the exchange rate now with cold hard cash and swap your Aussie dollars for greenbacks, euros or pounds. It will also act as a holiday savings account because you won’t be able to spend it before you leave the country.
Get a travel debit card
The danger of cash is that if you lose it, there’s no recourse. Pre-paid travel debit cards are a great option and will let you lock in the current rate, even if you’re not going to spend the money for some months. These cards are also a great way to save on withdrawal or transaction fees overseas.
Pay in the local currency
When making an electronic payment overseas (like with a standard bank issued credit or debit card) you will often be asked if you want to pay in the local currency or in Australian dollars. Always choose local currency. If you choose Aussie dollars you are paying the Dynamic Currency Conversion rate, which is weighted in favour of the merchant by up to 4%. This fee can completely wipe out the benefits you could be getting from a strong Australian dollar.
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