Don't Let The Recession Ruin Your Holiday

Make sure you can afford a summer holiday this year.

If, like me, you've spent the past few days with your shoulders hunched up and your hands thrust deep in your pockets trying, desperately, to keep out the cold, then I'd guess that you will also, like me, have been dreaming about blue skies, sandy beaches, and warmer climes.

But you may also be thinking that in such a frosty economic climate, that there's just no way you can justify the cost of jetting overseas to spend a week or two lying on a beach.

The good news is, there really is no need to let the recession spoil your travels, as by making a few small tweaks in your plans -- and sacrificing on one or two luxuries -- you can keep costs down, and beat the holiday credit crunch.

Book Early And Book Online

If you're determined to protect your 2009 travel plans, then you need to make some changes to the way you research, plan and book your holiday.

Many of us are guilty of leaving everything until the last minute, but there are some big savings to be made by getting ahead of the game and booking early -- to take advantage of availability and low fares.

While you're being proactive, ditch the high street travel agent and get surfing the internet yourself, as you can make hefty savings online, especially if you book your flight and accommodation at the same time.

Just make sure you watch out for hidden extras.

Cut The Cost Of Flights

• If you're looking for long-haul flights, or a flight and a hotel break combined, use a flight broker, such as Expedia.co.uk or Lastminute.com. These are effectively online travel agents and have specially negotiated deals with airlines and hotel companies.
• If you know when and where you want to go, use a screen scraper, such as www.kayak.co.uk. This site trawls through dozens of flight-broker sites in real time, saving you the job of visiting multiple websites to find the cheapest fare.
• Other simple money-saving tips include using regional UK airports, rather than the main hubs.
• Also research different ways of getting the airport to avoid pricey airport taxis; you could save a small fortune by going by coach instead of the train. Alternatively, drive your own car and arrange private parking in advance. (Read Avoid These Airport Rip-Offs for more details.)

Be Flexible With Dates

An easy way to make big savings is by being as flexible as you possibly can be with dates.

The most affordable seats can be found for Tuesday and Wednesday flights, with Fridays and Sundays the most expensive; taking one day off the length of your holiday could also save you cash.

Look at travelling mid-week and at off-peak times over the weekend, and if you can, avoid Christmas, Easter and school holidays.

Downgrade Your Accommodation

You may be used to getting the five star treatment, but a good way of cutting costs is by downgrading the star rating of your hotel or apartment.

Sacrificing just one star rating could save you nearly £600 on the price based on the price of a five and four star property in Marbella in June 2009, according to Expedia.co.uk.

You could also save money by booking via a specialist discounted hotel deals website such as Laterooms.com.

Pick A Cheaper Destination

While the top destinations for Brits abroad still include Spain, France, Italy and America, these places have become significantly more expensive due to the plunging pound.

But there are a few currencies where the exchange rate has actually improved, such as Iceland, where the collapse of the krona has significantly cut the cost of once-pricey hotels, meals and drinks.

For something a little warmer, try South Africa, where the falling value of the rand again the pound means day-to-day costs are cheaper than a year ago.

Or head down under, as the Australian and New Zealand dollars haven't moved much against sterling.

Cut The Cost Of Cover

If you're looking to reduce your holiday spending, you may be tempted to go without travel insurance.

But this is false economy as if things go wrong, you could find yourself with medical bills and repatriation costs which run into thousands of pounds.

Rather than go without, look, instead, at ways of bringing down the cost.

Use The Fool's travel insurance service to shop around for deals and discounts online.

If you are going away more than once a year, look to take out an annual policy rather than a single trip policy, and note that the free European Health Insurance Card (EHIC) also offers reduced cost medical treatment in just under 30 European countries. While the card is not a substitute for comprehensive travel insurance, it can you save money.

Make Your Holiday Money Go Further

Airports are one of the most costly places to buy currency, so make sure you've made plans to sort your currency ahead of your departure date. Make the most of commission-free currency outlets, but ensure you compare exchange rates.

Also be careful when doing your foreign currency calculations overseas, as you may think you've bagged a bargain when in fact you miscalculated the price. Packing a pocket calculator will help you stay on top of your spending.

Play Your Cards Right

Once abroad, you need to be aware that most debit -- and credit -- card providers levy a "loading" fee of around 2.75 per cent on all purchases overseas, while many also charge a "handling fee" of up to 2 per cent if you use your card to withdraw cash at a foreign ATM.

Nationwide building society is the only provider that doesn't make foreign currency charges on purchases and transactions anywhere in the world on its Visa debit card.

If you want to take a credit card, Nationwide fares well once again, as does the Post Office, as none of these levy foreign exchange fees on overseas purchases.

Further, when making a card transaction, resist the offer on the part of the vendor to charge you in sterling. Known as "dynamic currency conversion," it is almost always better to pay the bill in the local currency, as the exchange rate is likely to be pretty unfavourable to you.

More: Avoid These Airport Rip-Offs | Prepare For Your Perfect Holiday!