After the past two years sunshine holidays are starting to appeal to many of us once again. But with soaring costs of living it is important to find the best ways to make the most of your money.
And one trick which has gone viral on Tiktok explains how the way you operate cash machines overseas can make a difference to your finances. For it tells how to get the best deal when getting holiday cash if you need extra while abroad.
The video by James – aka @jamesycottar on Tiktok – is captioned “avoid foreign currency bank scam”. It warns holidaymakers what they should do when withdrawing cash in a different country.
Glasgow Live reported how he told followers they could be getting things wrong. He explained: “If you’ve ever used your bank card on holiday to take out cash then there’s a fair chance, like me, you’re doing it wrong.
“Someone much smarter than me – aka my girlfriend – told me that any time you use your bank card to take money out abroad the bank will offer you a conversion rate for that currency. Never accept it because they are getting commission off this and it’s always going to be a higher rate.”
Warning people to “always hit decline” he adds that you will then get offered “a second rate” however this time they won’t tell you what it is. Despite this, it’s the better option as it’s always “guaranteed” to be lower adding: “do this and you will always save money, and that’s a fact.”
The Scots tourist isn’t the only one to share the trick with Money Saving Expert’s Martin Lewis also telling people to keep their eyes peeled when using an ATM. Martin Lewis, as reported by the Daily Record, warned travellers that some cash machines will charge additional fees – even if you’re using a special overseas card – adding they can carry a 4.5% mark-up fee resulting in you being charged on top of the exchange rate plus a fee for using the machine.
Martin explained: “Even the worst card, never mind my specialist card that gives perfect rates, only adds a 3% conversion [fee].” The financial guru tested several ATMs all of which had conversion mark-ups of up to 4.5%.
Martin continued: “So, you do not want this machine to do the conversion for you, you want your card company at home to do the conversion because even if it’s not a good card, it’s at a better rate.” He then warned that cash machines may use “psychological scare tactics” to persuade someone to use their conversion rates by using an onscreen prompt which states “if you do not accept this option, we cannot guarantee the exchange rate offered”.
Martin also did the maths to show that withdrawing money without allowing the ATM to do a conversion cost £169.20, excluding the ATM fee, but using the machine’s rates would have cost him up to £191. Martin advised: “Do not pay to pay.
“When you got into a shop, when you go to a cash machine and it says ‘do you want us to do the conversion for you’ – no, no, no – pay in the local currency.”
For more stories from where you live, visit InYourArea