How to Save Money on Holiday: Practical Tips for UK Travellers
Published 26th of June 2012·Updated 8 April 2026
Reviewed by: Reviewed for accuracy April 2026
A family holiday of two weeks abroad can easily cost £3,000 to £6,000 or more. But with some advance planning, you can cut that figure significantly without sacrificing the quality of your break. The biggest savings come from booking smartly, managing your money abroad and getting the right insurance.
Short Summary
Getting the best exchange rate before you travel can make a noticeable difference to your spending money. Avoid airport bureaux de change, which typically offer the worst rates. Instead, order currency online from providers such as Post Office Travel Money or Wise and collect in advance or have it delivered.
Travel insurance is not optional. A medical emergency abroad can cost tens of thousands of pounds without cover. Compare annual multi-trip policies as well as single-trip options; if you travel more than once a year, an annual policy is almost always cheaper.
Comparison sites such as Skyscanner, Google Flights and Booking.com allow you to see prices across hundreds of providers. Being flexible on your departure date by even one or two days can save a significant amount on flights.
All-inclusive holidays can be cost-effective for families with young children, as food, drinks and entertainment are included and the total spend is predictable from the outset.
How do I get the best exchange rate for my holiday money?
Airport bureaux de change are almost always the most expensive way to buy foreign currency. According to Which?, airport rates can be 10 to 15% worse than rates available online. Order your currency in advance from a reputable online provider or your high-street bank.
Wise (formerly TransferWise) and Revolut both offer near-interbank exchange rates when you use their cards or transfer money. A prepaid travel card can be a sensible option: you load it with a set amount, lock in an exchange rate and use it like a debit card abroad. If it is lost or stolen, you can cancel it without your main bank account being at risk.
Take enough cash for the first couple of days, but use your card for larger purchases where possible. Notify your bank before you travel to avoid your card being blocked for suspicious activity.
How do I find the cheapest flights?
Use flexible date searches on Skyscanner or Google Flights to see which days are cheapest to fly. Mid-week departures (Tuesday and Wednesday) are typically cheaper than Friday or Sunday. Travelling in school term time rather than peak school holidays can also save hundreds of pounds, particularly for flights to popular European destinations.
Book flights and accommodation separately rather than as a package when prices allow. However, if you do book as a package, the ATOL protection scheme covers you if the operator goes bust, which is a valuable safeguard.
Setting up price alerts on Google Flights or Skyscanner means you will be notified when fares drop for your chosen route, allowing you to buy at the right moment.
Should I go all-inclusive?
All-inclusive holidays suit families well because meals, snacks and drinks are included in the upfront price, removing the temptation of overspending and making the total holiday cost predictable. The price difference between bed and breakfast and all-inclusive is often smaller than people expect, particularly in popular Mediterranean resorts.
That said, all-inclusive is not always the best value for couples or solo travellers who prefer to explore local restaurants. If you enjoy trying local food and do not drink much alcohol, you may find that a room-only deal and eating out gives better value.
Compare the true cost: calculate the daily cost of food and drink if you were to eat out, and compare it to the upgrade price for all-inclusive.
What travel insurance do I need and how do I get the right cover?
Travel insurance is a legal requirement in some countries and strongly advisable everywhere. A medical emergency can cost over £50,000 if you need repatriation to the UK, which no NHS cover will pay for abroad.
Key things to check when comparing policies:
| Cover element | What to check |
|---|---|
| Medical cover | Minimum £5 million for European travel; £10 million for US or worldwide |
| Cancellation cover | At least £3,000-£5,000 for a family holiday |
| Baggage | Limits per item, not just total; electronics often excluded |
| Activities | Specific sports and excursions may need a premium policy |
| Pre-existing conditions | Must be declared or claims may be refused |
Do not rely on credit card travel insurance without reading the terms. Many credit card policies have low limits or exclude pre-existing medical conditions.
If you travel more than once a year, compare single-trip and annual multi-trip policies. An annual policy for a family from a provider such as Direct Travel or Avanti Travel Insurance can cost less than two separate single-trip policies.
How do I save money on accommodation?
Use booking.com, Hotels.com and Expedia to compare prices, and always check whether booking directly with the hotel is cheaper. Hotels sometimes offer their best rates to direct bookers to avoid paying the platform's commission.
Consider apartments and holiday lets through providers such as Airbnb or VRBO for families, as these often work out cheaper than hotel rooms when you account for self-catering. Cooking even a few meals yourself can save a significant amount over a fortnight.
Travelling slightly outside the peak season (early June or mid-September rather than July and August) can cut accommodation costs by 20 to 40% at popular European destinations.
Is it cheaper to book a holiday last minute or in advance?
It depends on the destination and the time of year. For peak summer holidays to popular destinations, booking early (6 to 12 months ahead) tends to give the best prices on flights and guarantees availability. Last-minute deals exist but are less reliable for family travel when you need specific dates and room types. Use a price alert service to monitor prices and book when they drop to a level you are comfortable with.
Should I use a travel credit card abroad?
Yes, if you plan ahead. A specialist travel credit card such as the Halifax Clarity or Barclaycard Avios Mastercard charges no foreign transaction fees, meaning you get the interbank exchange rate with no loading. Most standard debit and credit cards charge 2.75 to 3% on every overseas transaction. Paying with a travel card for larger purchases abroad can save a useful amount over a fortnight.
Does travel insurance cover me if the airline goes bust?
Most travel insurance policies include cover for scheduled airline failure (SAFI), but check the terms carefully as cover limits and definitions vary. If you booked on a credit card and paid at least £100, Section 75 of the Consumer Credit Act may give you an additional route to a refund from your card provider. ATOL protection covers you for package holidays booked through ATOL-licensed operators.
What is the cheapest way to eat on holiday?
Avoiding tourist-facing restaurants near beaches and main attractions and eating where locals eat is consistently the best strategy. Local supermarkets for breakfast and lunch items, combined with one sit-down meal per day at a less central restaurant, can cut food costs dramatically. In many European countries, a set lunch menu (a "menu del dia" in Spain or a "formule" in France) offers a two or three-course meal at a fraction of the dinner price.
How do I avoid bank charges on holiday?
Tell your bank you are travelling before you go, to avoid your card being blocked for suspected fraud. Use an ATM attached to a local bank rather than standalone cash machines in tourist areas, which often charge high fees. Decline any offer to pay in pounds rather than the local currency when using your card abroad, as the "dynamic currency conversion" rate offered by the terminal is almost always worse than the rate your bank would apply.