The number one way to save money on travel…
What would £530 buy you these days hey? A flight to Cuba? A weekend for two in Italy? A month in Thailand?
Why spend the money on those once in a lifetimes experiences when you can spunk the whole lot on foreign transaction fees, purchase fees and cash advances on your debit and credit cards?
That’s what I ‘chose’ to do. Thanks to not keeping my eye on the ball over the last year I’ve spent £529.96 on the pleasure of withdrawing cash.
Just so you know, this post isn’t sponsored in any way.
How to waste as much cash as possible
The two accounts in question, the ones I’ve been using, are the Natwest Current Account and the MBNA credit card. Both absolute fucking rip offs. I kind of knew, but just thought all banks were the same.
Just a little internet research shows me this is not the case. In fact, if I put my Natwest bank account into moneysavingexpert’s travel card cruncher it tells me that my card is ‘one from hell’, when it comes to travelling.
This Natwest card, the one that I’ve had since I set up my uni account at 18, didn’t even work in Guatemala – leaving me screwed – nor in Japan – leaving me to use my credit card and incur even higher fees.
I get charged 2% for ‘foreign cash’ as well as a £2-£5 ‘non-sterling transaction fee’ every time I use an ATM. If I purchase on my card the ‘foreign purchase fee’ is £1-3. For every £200ish that I withdrew I’d have to spend about £8. This has led to £339.52 over 12 months (£28.29 per month) with no benefits whatsoever.
My interest is 0.05%, if the money was ever in there long enough to spend.
Every time I take out money on this credit card – which has absolutely no benefits either (I used to get play.com points, when I bought CDs) – I get charged £5 flat out, as well as a 7% fee on top. It cost me £36 to get £400 out in Japan. Yikes.
Transaction fees and cash advance fees on this card have ended up costing me £183.90 over the year, although I only really used it in my five weeks in Japan.
Keep an eye on things
One of the biggest worries for people wanting to travel is how to afford it. They spend all this time saving up money and carefully looking for the cheapest hostels when every time they use their bank card they’re pissing money up the wall.
When I say ‘they’ I mean me.
The thing is, I’ve never been home long enough to look into it properly, or fully realised how much I was getting ripped off.
You have to keep an eye on your bank accounts, credit cards and savings. Banks are ready to rip you off and slash your interest rates at any opportunity. You know when you open an ISA and they make a big fuss about it? After a year they put you right down to 0.02% again, usually without telling you. If you’re not on 1.5% they’re exploiting you. I’d suggest you look at moving your money every April when ISA season comes around.
So, how to save £529.96 next year
After much research I have now opened a bank account with Norwich and Peterborough Building Society. Mainly because they don’t charge a fee for foreign cash withdrawals or spends. Any fee, whatsoever. The 5-minute sign up is what’s going to save me up to £530 next year. That’s how much two of us spent in two weeks in Vietnam, it’s a holiday!
I’m still keeping the rip off Natwest one, just out of habit. I know all the codes, access numbers and I’ve had it forever but most of my action will move to the other one. All it requires is £500 per month in it, or you have to pay £5. Even if I get that once a month it’s still cheaper than what I’m paying now – £60 vs £530.
I’ve also signed up for a British Airways American Express Executive Clubcard. I’m already a member of the British Airways Executive Club and in just a year found I’ve saved up enough points to bring the cost of flights I need down. I saved £30 on my last BA flight from Malaga, brilliant!
As long as I pay it off every month, I’ll save even more than the £530 in the long run.
With them I’ll earn 9000 points for spending £1000 in the first six months too – easily done with all the travel I have coming up – and I’ll get 1 Avios point for every £1 I spend too. If I lose or damage anything bought on the card within 90 days, it’s covered too. Sweet!
Control your money before it controls you
So the point that I’m getting at is that you need to keep an eye on your finances. Check your interest rates, your fees, your benefits and your APR and if you spend as much as me, you could find yourself £530 richer.