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For many a holiday might seem like something of an expensive luxury at the moment. But there are still ways to save on holidays in 2023.

A falling pound, rising costs and hotspot congestion – these are just some of the factors which might make you think a holiday abroad is out of reach this year. By following a few simple money tips and tricks, jetting away on a well-deserved holiday is absolutely possible for most people.

Here are some ideas to get you started in 2023.

Go where the pound is strong

The pound had a miserable year in 2022. This was compounded by a series of calamitous policy decisions taken by the Government towards the end of the year which sent the value of the currency sliding. While the value of sterling has recovered somewhat from nearly reaching parity with the dollar, it is still much weaker than it was at the start of last year, meaning some destinations remain pricey for British holidaymakers. This is particularly true in locations where the US dollar is king – mainly the US, but lots of other countries use dollars as their main currency, such as Puerto Rico and Panama, too.

However, there are still some top global holiday destinations where the pound has maintained its relative value, or even become stronger. For instance, the South African rand has remained at broadly the same level over two years compared to sterling, while Egyptian pounds have in fact become weaker versus the UK pound. Other countries such as Argentina, Hungary, India, Israel, Japan, Norway and Sweden have all seen their currencies weaken versus GBP, making the relative cost of travelling there cheaper.

If you want to see where the best rates are for your foreign exchange, then XE.com’s currency charts are a really good place to start. Of course, some of these destinations are on the more adventurous side, and others require big long-haul travel, so savings are only really worth it if you can still get a good deal on flights and other aspects.

Use price comparison

This is where making good use of price comparison comes in. We’re all reasonably accustomed to using price comparison websites to get deals for our insurance, broadband and other home services. However, travel comparison is no different, with a big selection of services that will find you the best deals out there. Price comparison isn’t just for flights – you can get quotes for hotels, car rentals and even package deals too.

Good websites to get started include Kayak, Google Flights, Momondo and Skyscanner. One thing to watch out for with price comparison though – and this is particularly the case for flights – is added extras that aren’t in the headline price. This is a common tactic used by airlines to mask the “true” cost of the flight in order to make it look attractive. Airlines will offer cheap fares, but then pile on costs from adding baggage, picking seats, and other amenities that once upon a time were inclusive of the price, but these days rarely are.

Get a good deal on foreign currency

Exchanging your pounds for the local currency can be one of the most deceptively expensive aspects of travelling abroad. We all know that buying foreign currency at the airport is expensive, as you’ll pay fees and won’t get the true exchange rate, leaving you with significantly less for your money. Even well-established high street institutions such as the Post Office don’t offer the best rates. The trick to see where this is the case is if the exchange offers ‘fee free’ currency. If you don’t pay headline fees, you’re most likely paying through a worse exchange rate.

It is much better these days to just use a bank card abroad that offers no fees and the Mastercard real exchange rate. Far and away the best for this is Starling Bank, where you’ll get the live exchange rate for your currency and there are no limits on spending.

Get a local sim card

Since the UK left the EU, roaming charges have bounced back into our lives when travelling to Europe. Some UK providers do still offer decent terms when travelling, but this is usually only the case within the EU. At the time of writing those include Asda Mobile, BT Mobile, iD Mobile, Lebara, O2, Plusnet, Sainsbury’s, Smarty and Virgin. If you use EE, Three or Vodafone then charges now apply when you use your minutes or data abroad. However, there is another way to secure a cheaper deal when you travel and that is to get a local sim card. Many modern phones will allow you to pop in a second physical or digital sim card, meaning you don’t have to use your UK minutes and data abroad.

The best thing to do when you arrive at the airport of your destination is go straight to one of the local providers’ shops to ask for a sim data deal – the airport arrivals is usually packed with them offering deals to tourists. Do your research on the destination before arriving though to ensure you pick a reputable carrier.

Come to the airport prepared

It can be really easy to find yourself spending large sums unwittingly in the airport before you’ve even left the UK. From expensive sandwiches to extortionate water bottles – the products on offer are usually very expensive compared to normal. It pays then to come prepared. Bring an empty water bottle to fill up once you’ve passed security and pack sandwiches if you think you’ll get hungry.

This also extends to other things like buying a neck pillow for your flight – you’ll get ripped off if you can’t live without one on the plane but forget it at home. This is also a salient point if you think you’ll struggle to stay within the baggage limit. Leave behind basic items like shower gel and toothpaste – ubiquitous products you can buy locally at your destination when you arrive.

Make sure you’re insured

While this isn’t a direct saving per se – failing to get good travel insurance can be extremely costly for you and your family. It’s easy to pick up good value travel insurance these days using price comparison sites to find the deal that suits you. The cost of healthcare in countries such as the US can be extraordinarily high and will be crippling if you don’t have insurance to protect you if you get injured or fall ill abroad.

With the UK leaving the EU, the old European Health Insurance Card (EHIC) is now expiring too, so make sure you apply for the new GHIC. But also remember this won’t preclude you from paying any costs, it just gives you right of access to state healthcare in EU countries and Switzerland and is not a replacement for insurance. It is also a really good way to save on rental insurance costs. Instead of paying over the odds for the premium insurance direct from the car hire firm, get car hire excess insurance instead, which will cover the premium you have to pay if you have an accident abroad with a hire car.

Be flexible

Ultimately, the deciding factor on how much your holiday is going to cost will be the destination you pick. If prices in popular destinations such as Spain, France or Italy are looking high, consider alternative up and coming destinations such as Albania, Hungary, Morocco, or even at home in the UK. You can often find staying closer to home or venturing further afield can reward you with the same top-quality experiences at much more competitive prices.

Any opinions stated are honestly held but are not guaranteed and should not be relied upon.

The information contained in this document is not to be regarded as an offer to buy or sell, or the solicitation of any offer to buy or sell, any investments or products.

The content of this document is for information only. It is advisable that you discuss your personal financial circumstances with a financial adviser before undertaking any investments.

All the data contained in the communication is believed to be reliable but may be inaccurate or incomplete. Unless otherwise specified all information is produced as of 12th January 2023.