Know the secrets of travel money success and have more to spend

Millions of Australians have the travel bug, but many are spending more than they need to because they get caught out. SEE OUR TIPS

Psst! Wanna take a cheap trip? Aussies certainly love to travel, but many are getting stung financially by not knowing the savings secrets that travel operators don’t share with us.

The Federal Government forecasts that we’ll pay for 404 million nights of domestic travel this financial year and make almost 12 million departures for overseas destinations.

Its Tourism Research Australia numbers predict our overall spending on travel will increase despite weak wages growth and a sluggish economy.

This suggests we’re diverting more of our incomes into travel, but why should we spend more than we have to?

I personally caught the travel bug 21 years ago, and have had a serious infection of it ever since.

That, combined with my job that involves chatting with money specialists every day, has helped me discover several handy ways to save on holiday spending.

It may be too late to act on them these school holidays, but hopefully these travel secrets will save you some serious cash for your next trip.

ALWAYS DOUBLE-CHECK FOR DEALS

Getting a second opinion is a good idea with doctors’ diagnoses, and it should also be sought by travellers who don’t want to bleed unnecessary cash.

Whether you’re booking flights, accommodations or tours, always compare prices between the provider, any third-party website that links to them, and your travel agent if you use one.

Hotels might say they offer cheaper prices to people who book directly through them rather than on popular websites such as Trivago or Booking.com, but don’t take their word for it.

Your next holiday could cost less thank you think if you do some extra research.

A good example is an inquiry I recently made for three rooms at a small hotel. They emailed me their “special offer: pay in advance to get the best rate” deal costing $2333.

However, I’d already seen a price of $1643 for the exact same dates on a popular accommodation website. That’s a difference of almost $700 — or 42 per cent — that many travellers would inadvertently just swallow.

Sometimes you’ll get a cheaper rate directly from the hotel or airline. But it always pays to check.

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MAKE EVERY DOLLAR COUNT

The most common question I’m asked by colleagues, friends and family before they head overseas is “when should I buy my currency?”

The simplest answer to this is always going to be “no bloody idea”.

But the most helpful answer is to spread out your currency purchases, avoid buying foreign notes at major airports, and compare prices between big banks and smaller currency exchange businesses.

The little guys will almost always give you a better rate, especially if they’re not in a popular tourist location.

Spreading out currency purchases over time means you won’t get stung by sharp foreign exchange movements that weaken your buying power.

Fortunately, many of us now do this automatically when we pre-book flights and accommodation and pay upfront.

You can pay for some stuff now, buy some currency a few weeks before flying out, then make purchases on credit cards or debit cards while overseas. You won’t get the absolute best currency deal, but you won’t get the worst either.

Changing currency can be an expensive activity for those who aren’t prepared.

AVOID CAR RENTAL RIP-OFFS

You’ve booked a rental car for your interstate holiday, but when you arrive to pick it up you discover its $40-a-day charge gets bumped up to $70 or $80 a day by the car company’s suggestion that you buy accident excess reduction insurance.

This insurance prevents you from paying a $5000+ excess if you’re involved in an accident (even if it’s not your fault) but it’s a rip-off that can almost double the price of your car hire.

A cheaper option — that rental car companies won’t tell you — can be to buy a domestic travel insurance policy that includes rental car excess.

Another rental car savings secret is to check for online discount coupons when you’re booking. Do an online search using the rental company’s name and “discount codes” and some options should pop up. Then try a few codes on the rental car website to see if the discount actually works — it’s saved me money in the past.

USE FREQUENT FLYER POINTS WISELY

Flying for free will knock a big chunk off any holiday bill, but many people ignore opportunities to collect frequent flyer points.

Thousands of points can be earned each year through credit card spending, sign-on deals, bonus points from shopping partners and even exercising or booking ride-shares such as Uber.

For example, using a rewards credit card just to pay for your weekly grocery shopping should give you enough points to fly return between Melbourne and Sydney or Adelaide.

Whack all possible expenses on a rewards credit card and your free trips will multiply, but these credit cards are only worth it if you pay their balance off monthly to avoid sky-high interest rates.

The second secret to saving money on flight rewards is to get the biggest benefit from points collected. That means only using them for classic or traditional flight rewards and never using airlines’ points-plus-pay options, which gobble up about three times as many points.

And don’t use frequent flyer points to pay airport taxes and departure charges — that’s a similar waste of points power.

@keanemoney

Originally published as Know the secrets of travel money success and have more to spend