What is Travel Money?

30th December 2018by Joanna White

Travel money, in its simplest terms, is the type of currency that you use when you’re abroad, instead of your common currency (such as pound sterling, for example).

The exact type of currency that you need will depend entirely on where you’re travelling to. There are over 180 currencies in the world, whereby most countries have their own currency, but some (such as the Euro) share the same currency.

This guide will show you what travel money is, as well as where to buy it and where you can spend it.

What is travel money?

Travel money comes in various forms including cash, cards and traveller’s cheques. Each of these will allow you to pay for things in different countries, but they are all unique.

Cash

Regardless of where you’re travelling to, how long you’re going for or your preferred method of travel money, it’s a good idea to always have at least a little bit of cash on you when travelling to a new destination.

This is so that you’re prepared in the event of an emergency where you need to use cash to buy something or take a taxi somewhere.

Cash is a great thing to have on you, but it’s not advisable to carry large amounts of cash with you at all times as it can be easily stolen or lost.

It’s also important to remember that most travel insurance providers will only cover you up to a certain amount if you’re carrying cash and it becomes lost or stolen.

Cards

Travel money in terms of cards comes in various forms, such as debit cards, credit cards and pre-paid travel cards.

In many countries, you can use your regular debit or credit card to pay for things or to withdraw cash from an ATM. You may face transaction fees by doing this, which means the bank will charge you for taking out money, so it’s important to let your bank know before your trip to try and avoid extortionate charges.

Debit cards are a quick and convenient way of withdrawing cash and paying for things while you’re abroad, but you may also be limited in some countries as ATMs are not always widely available.

Credit cards work in a similar way to debit cards in that they can be used in many places around the world. They’re also the most widely accepted cards all over the world and you can rest-assured that you’ll be protected if your card is lost or stolen.

However, some credit cards may also charge you additional fees when you use them, and you also must remember to pay off your card when it is due, otherwise you could end up facing extortionate fines.

Pre-paid cards are becoming increasingly popular with holiday makers as they’re simple and safe to use. They work in a similar way to credit and debit cards in that you can use them to make purchases while you’re abroad, but they’re a unique card that you must load with money before you travel.

This type of travel money means that you won’t be able to spend more than you have available due to them being preloaded before you travel. You can also often preload your card with different types of currency if you’re travelling to numerous destinations on your trip.

However, some pre-paid cards may charge you additional fees if you require a replacement card, and you might also find yourself facing fees when you use them at an ATM.

What you need to know

When it comes to travel money, there are a few things you should know in order to make it much easier for you to buy. Find out more about the exchange rate as well as where you can buy your travel money.

Exchange rate

The exchange rate is how much foreign money you’ll obtain in exchange for your current currency; for example, how many dollars you’ll get for your British Pound.

Exchange rates differ all the time, depending on the place you get your money from as well as how much you want to exchange. They’re very volatile and can sometimes vary massively even over the course of one day.

Therefore, if you plan on exchanging currency for your upcoming holiday, then it’s a good idea to do your research on the places that offer the best exchange rate, as well as the best time to buy your currency.

How much money will you need?

How much money you’ll need for your holiday will depend on many different factors.

  • How long you’re going for – obviously if you’re going on holiday for two weeks as opposed to just two days, you’ll need much more travel money
  • Transport costs – this will include paying for the likes of taxis, airport transfers and buses while you’re at your destination
  • Your food and drink – how much you’ll spend on food and drink is entirely unique to your lifestyle and the type of holiday that you want
  • Any activities – how much money you’ll need will also depend on what kind of activities you plan on taking part in while on holiday

Where to buy travel money

There are so many places that you can buy travel money from. Look at the list below to find out all the best places to purchase your travel money for your holiday.

  • Banks
  • Travel agents
  • The Post Office
  • Bureaux de change
  • Foreign exchange brokers
  • Shops and supermarkets

Conclusion – what is travel money?

Travel money is a simple concept to understand once you get the hang of it. It’s essentially the type of currency that you’ll use to buy things when you’re in another country.

There are many ways to use travel money, including cash, debit and credit cards and pre-paid cards. You must also keep an eye on the exchange rate to gauge when the best time to purchase your travel money is; you want a good exchange rate so that you can get the best deal for your money on foreign currency.