Where your holiday cash will stretch the most – and least

You could save hundreds of pounds on your holiday by doing a little research.

Huge currency fluctuations could see holidaymakers saving up to a quarter on their trips abroad, or shelling out as much as a fifth more this year, new research suggests.

The pound recently hit a 13-month low against the euro and other European currencies, driving up prices at a time when many will be looking to book their spring or summer holidays.

Prague in particular could prove expensive, according to Post Office Travel Money. Not only has the Czech koruna risen 7.8% against the pound, but higher meal prices could see holidaymakers paying 20% more compared to last spring.

Winners and losers

The good news is that many European destinations have significantly reduced their prices in a bid to attract tourists, more than outweighing the sterling-induced price hikes.

For example, meals and drinks on Portugal’s Algarve and Corfu in Greece will cost UK visitors 13% less than a year ago, while prices in Sorrento and the Costa Del Sol are down 5%.

Similarly, the rising strength of the Croatian kuna and Bulgarian lev has been more than offset by price cuts in many resorts in Zadar and Sunny Beach, according to the Post Office.

Looking beyond Europe, the pound has fared far better against a number of currencies, and there are huge bargains to be had for holidaymakers willing to travel a little further.

The South African rand has fallen more than a quarter (26%) against the pound in the last year alone, while a weak Mexican peso means you can get £76 more currency when changing £500 compared to a year ago. Similarly, the Australian, New Zealand and Canadian dollars have all fallen in value since last February and are now over 10% weaker than two years ago, as the table below demonstrates.

Source: Post Office

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Bad news for those heading to the US, Japan

Sadly the pound hasn't fared well against all currencies, meaning some popular global destinations are now notably pricier. For example, the US dollar is at a five-year high against the pound, making both Orlando and New York around 10% more expensive.

Holidaymakers heading to the Caribbean will get 7% less currency than a year ago, while in Japan a stronger yen means you will get around £66 less when changing £500.

Source: Post Office

Do your research!

The stark currency shifts witnessed over the last year make it especially important that you do your research and consider new holiday destinations, said Andrew Brown of Post Office Travel Money.

“With sterling’s recent fall in value against more than half of our bestselling currencies, you can’t blame holidaymakers for thinking twice about where to go on holiday. However, canny travellers will be quids in if they opt for destinations with weak currencies or those where local prices are low. Better still, if they combine both elements their holiday money will stretch further.”

And it's crucial to extend that research to where to change up your holiday money too. You'll pay far more to change your money up with a high street firm or your bank than with a smaller specialist. You'll also need to consider whether you want to secure a 'buy back' rate for any leftover currency when you return from your holiday.

Be sure to check out our great guide on How to get the best deal on your holiday money.

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