How to protect your holiday money from a currency crash

How to protect your holiday money from a currency crash

With the pound at its weakest in six months, Brits’ wallets are being squeezed just in time for holiday season. Find out what it means for you, and what you can do to make your travel money go further.

The strength of the pound fell to a six-month low this week, amid market fears of a no-deal Brexit. For millions of Brits heading out on holiday, this will have a real impact on their spending money.

At its height, on 27 March 2019, you could buy €1.17 for each pound. By 17 July, that had dropped to €1.11.

Here, we look at the difference this could make to your holiday, and the steps you can take to make the most of your sterling.

How much will your pounds get you?

Exchange rates can seem abstract, but looking at specific examples shows the effect on your every day spending.

A cup of coffee in Benidorm costs £1.56 on average based on the exchange rate on 2 April 2019, according to data from Post Office Money. At today’s rate, our analysis shows that the same coffee would cost £1.65.

On a larger scale, the same Post Office Money research found that a typical first day’s spending in the Algarve would cost £57.45 at the April exchange rate. Today, that same day would cost £59.31.

At a more expensive destination like Sorrento in Italy, the difference becomes more pronounced. A £127.15 day in April could cost £131.27 at today’s rate. That £4.12 difference per day could add up to almost £58 for a two-week stay.

Keep in mind these differences have been calculated using the interbank rate – the ‘pure’ exchange rate that banks charge one another. In most cases, you’ll have to accept the rate set by your card provider, plus you’ll also be charged fees. Avoiding these fees and securing the best possible rate is key to surviving the currency crash on holiday.