In recent years, the convenience of using cards for payments has grown increasingly popular among holidaymakers. However, a new study reveals that relying solely on cards while traveling can result in unexpected expenses. More than one-third of travelers report having been caught off guard by situations requiring physical cash during their trips abroad. These hidden travel costs can catch many off guard, leading to unnecessary financial burdens while abroad.
Importance of Cash in Travel: Survey Findings
A survey conducted by “Be Clever With Your Cash”, in partnership with “Opinium”, highlights that 39% of travelers have experienced difficulties when they were unable to pay with a card. These situations often arose in instances such as:
- Tipping: A common scenario where cash is often the preferred method of payment.
- Taxi rides: Smaller, independent taxi services sometimes do not accept cards.
- Local shopping: Independent retailers and markets are less likely to have card payment options.
Despite the growing trend of cashless transactions, experts caution that travelers may still face challenges when they venture outside major cities, particularly in rural or remote areas where cash remains the primary form of payment. Travelers should be aware of the hidden travel costs associated with these scenarios.
The Hidden Fees of Cash Emergencies
When travelers find themselves in need of cash unexpectedly, they may face additional costs. ATM fees for emergency withdrawals are common, particularly when withdrawing cash abroad. Many holidaymakers also turn to airport exchange desks for quick transactions, often receiving unfavorable exchange rates compared to those available in other locations. These hidden travel costs can accumulate quickly, undermining the convenience of using a card exclusively. To avoid these fees, experts suggest preparing ahead by carrying a small amount of local currency, referred to as a “cash cushion,” which can prove useful for emergencies, such as tipping, local transportation, or areas where cards are not accepted.
Expert Tips for Avoiding Extra Costs
Amelia Murray, a money expert at Be Clever With Your Cash, emphasizes that travelers often overlook the need for cash, assuming that having a fee-free card is enough to cover all expenses. However, if travelers rely solely on cards, they may end up paying extra fees at ATMs or facing poor exchange rates abroad. These unexpected charges contribute to the hidden travel costs of international travel.
Murray recommends travelers take a few simple steps to avoid unnecessary costs:
–Carry a small amount of cash: Having a “cash cushion” can be helpful for small expenses like tipping or paying for transport in areas where cards are not accepted.
–Understand card fees: Before traveling, holidaymakers should familiarize themselves with the terms and conditions of their cards, particularly regarding foreign transaction fees and currency conversion charges.
–Check insurance coverage: Many travel insurance policies offer coverage for lost or stolen cash. Travelers should verify their policy to ensure they are adequately protected, as policies often cover amounts up to £300 for lost cash.
The Role of Travel Insurance
The need for cash protection is also covered by travel insurance. Research from Defaqto found that 91% of annual policies and 86% of single-trip policies include cash cover. This offers reassurance for those who may lose their money while abroad. According to the findings, 35% of single-trip policies cover cash losses of up to £299, while 24% offer coverage for losses of £300-£399.
Preparing for the Unexpected
While it may be tempting to rely solely on cards during international travel, travelers are encouraged to be mindful of the challenges and potential costs that can arise. Being prepared with some physical cash and understanding card fees can help ensure a smoother experience. By adopting a balanced approach and carrying a small amount of local currency, travelers can avoid hidden travel costs and enjoy their trips without unnecessary financial stress.
In conclusion, while cards are convenient, holidaymakers are advised to plan ahead and ensure they are prepared for situations where cash may still be necessary. With proper preparation and awareness of the associated hidden travel costs, travelers can avoid unnecessary financial burdens and fully enjoy their holidays.
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via >EPR
