Twenty Tips To Save On Holidays

Many schools break up for the summer holidays this week, so we've come up with twenty top tips to drive down the cost of holidays.

With the UK in the grip of a heatwave at the moment, it hardly seems worthwhile jetting off abroad when parts of the nation are hotter than some Mediterranean islands.

Nevertheless, we Brits love our holidays: we spend an average of around £1,900 per family on holidays, and one in five of us takes at least four holidays a year, which sounds very appealing! So, whether you're heading off for a weekend break or a trip of lifetime, rack up some serious savings with the following tips:

1.Save a fortune online

The Internet is the perfect tool to help you to find bargain holidays, with price-comparison and travel websites galore. Check out the following websites for everything from car hire and flights to hotels and reviews: Cheapflights, ebookers, Expedia, Lastminute, Opodo, Teletext Holidays, Travelocity, Travelzoo and TripAdvisor.

2.Beware of mobile roaming charges

Although the European Commission has ordered the mobile networks to reduce the cost of using mobile phones abroad, it still costs a pretty penny to receive or make calls while you're overseas. The best thing to do is to leave your mobile at home, relax and enjoy a phone-free holiday!

3.Pay less for airport parking

By booking airport parking in advance (even just three days before you leave), you can save a tidy sum. These websites will help you to reduce this expense by up to three-fifths (60%): Airparks, Airport Parking Discounts, Airport Parking Shop, Airport Parking and Hotels, Holiday Extras, Parking 4 Less and SimplyParking. Alternatively, if you're travelling to and from the airport by taxi, be sure to book a minicab in advance; otherwise, you'll have to hail a cab from the airport ranks, which will cost far more.

4. Pay nothing for a car-hire upgrade

On several occasions, my wife and I have enjoyed a free upgrade when we've collected a hire car. Many car-hire firms keep few smaller cars in stock, so we've often been automatically upgraded to a larger model without paying a surcharge. Remember: don't fall for the trick of paying for an upgrade when you can get it for nothing!

5. Get discounts on Disney

If you plan to take your children or grandchildren to Disneyworld (Florida) or Disneyland (California), then be sure to visit the MouseSavers website. It offers great discounts on all things Disney and, although it's aimed at US residents, many of the deals apply to us Brits, too. (Thanks to our chums at Fool.com for this tip.)

6. Saving up makes sense

Instead of buying your next holiday on your credit card or taking out a personal loan, do the smart thing by planning ahead and saving up. By saving over the course of a year, you can earn some interest instead of paying it. For example, you could save £244.58 a month in the Best Buy ICICI Bank HiSAVE account, which pays 4.12% a year after basic-rate tax. After a year, you'll have £3,000.05, made up of your contributions of £2,934.96, plus after-tax interest of £65.09.

7. Don't overpay for your holiday loan

Although I don't believe in paying for something by spending tomorrow's money today, I recognise that millions of people don't plan ahead and, instead, borrow to pay for their annual family holiday. If you are one of these naughty people, at least make sure that you don't pay over the odds for your loan. Read my twelve tips to choose a personal loan and then visit the Fool's personal loan centre.

For example, according to the Fool's loan search (powered by independent financial researcher Moneyfacts), a loan of £3,000 over one year (without rip-off payment protection insurance) can cost as little as £3,089.52 with Moneyback Bank. Pick the wrong loan and this cost could leap by £300+, so choose wisely!

8. Enjoy interest-free credit until 2007

Play your cards right and you can enjoy interest-free credit on all of your retail spending (including the cost of your holiday) for up to a year. Simply apply for a 0% on new purchases card and enjoy 0% interest for up to a year. Learn more in How To Master Your Credit Cards.

9. Take the right credit card abroad

Another way to beat the system is to take the right credit card abroad. As I explained here, you'd be mad to go abroad with any plastic other than a Nationwide BS credit or debit card, because other plastic cards charge rip-off foreign-currency fees (typically 2.75% of each transaction) and other hidden charges.

10.Find cheaper holiday money

As I revealed in Get More Currency For Your Cash, it pays to shop around for holiday money, as the difference between the best and worst deals can amount to £30 for every £500 that you hand over. For the record, I always order my currency in advance from the Travelex website and collect it at the airport, ferry terminal or rail station.

11.Book early or late

If you want to score a serious saving on a package holiday, learn to book months in advance or at the very last moment. By booking next year's holiday just after you've returned from this year's, you can grab a cheap deal before the hordes descend. Also, there are decent discounts to be had by snapping up an unsold holiday just days before the departure date.

12.Travel at awkward times

If you want to bag a bargain break, you need to beat the law of supply and demand, because the most popular departure dates and times come with a premium price tag. By taking a 3am ferry or flight, leaving midweek instead of on Fridays or Saturdays, or booking a slightly out-of-season vacation, it's possible to knock hundreds of pounds off the price.

13.Renew your passport before October

As I'm not going abroad this year, I allowed my passport to expire last month. However, I see that the fee for a new adult ten-year passport is to rise to £66 from October, which is a whopping 29% increase on the current fee of £51. Hence, I'll be sure to apply for my next passport before the price rise takes effect in just over two months' time, saving £15 in the process.

14.Travel as a group

One way to save money, particularly on accommodation, is to book en masse in order to attract group discounts. Hiring a holiday home which sleeps eight doesn't cost twice as much as one which sleeps four, so you save money by holidaying together. I'm off on holiday en famille later this year with my family, my parents-in-law, my sister-in-law and her family, and my brother-in-law's children. In total, there are six adults and eight children in our group, which should mean lots of family fun -- and noise!

15.Get cheaper trips during school holidays

The government and the Federation of Tour Operators have come up with the Every Lesson Counts scheme to encourage parents not to take their children on holiday during school terms. The participants, including Airtours, British Airways Holidays, Cosmos, Thomas Cook and Virgin Holidays, offer discounted deals and free child places during school holidays. However, these may not be the cheapest deals, so it still pays to shop around before booking.

16.Visit your local library before you go

Instead of paying, say, £15 for a guidebook, check to see if your local library has a copy and reserve it before you go away. If you're worried about returning your books on time, ask for an extension to the usual borrowing period, or renew them online or by phone at the appropriate time.

17.Haggle with hoteliers

It often pays to contact hotels direct, especially if you're looking to book just weeks in advance. Email your chosen hotel to check the availability of rooms, then contact it a week or so later to see if the price has come down. If you don't like haggling, let LateRooms take the strain instead!

18.Reduce your motoring costs

If you're going on a motoring holiday, it makes sense to minimise your fuel and other motoring costs, as well as the risk of accident. Like a good Boy Scout, you need to be prepared, so read this guide to finding cheaper motor insurance, breakdown cover and more.

19.Track down cheaper travel insurance

As I warned in Don't Trip Up When You Travel, buying travel insurance from travel agents and tour operators is a big mistake. These firms charge premiums up to ten times as much as those charged by Best Buy travel insurance providers, so get a quality quote in our Insurance centre instead. Also, if you plan to go away at least twice in the next twelve months, get a quote for annual travel insurance. This usually works out cheaper than buying a separate policy for each trip.

20.Get two for the price of one

For cheaper days out by train in London and the South East, visit the 2 for 1 website, which offers reduced-rate entry into a number of attractions, such as London Zoo, the London Dungeon and Madame Tussauds.

That's it from me. Happy holidays, everyone!

More: Use the Fool to compare credit cards, compare personal loans and compare savings accounts!