Should I take my credit card on holiday?

Should I take my credit card on holiday?

author: Bryony Pearce

By Bryony Pearce

To pack or not to pack. Are you stuck in a pre-holiday credit card conundrum? If you are, by the time you’ve finished reading this article, you’ll be armed with the pros, cons and alternatives, to help you make an informed decision.

When planning your much-anticipated holiday, there are always loads of things to remember. And, from excursions to airport transfers, keeping on top of exactly how you’re going to spend money while you’re away might not always be at the top of your to-do list. But, with a bit of careful planning in advance, you could save yourself unnecessary aggro while you’re away, leaving you to enjoy your well-earned holiday.

Whether you’ve gone for the all-inclusive option or not, you’ll inevitably need some holiday spends, so let’s run through the pros and cons of taking your credit card abroad, as well as discussing the alternatives.

The benefits of taking a credit card

No cash

One of the best things about using your credit card while you’re away is that you won’t be carrying around wads of cash. If for some reason that cash went AWOL, whether it be stolen or misplaced, you’d be left with nothing and you couldn’t do much to recoup the loss. With a credit card, on the other hand, you could contact your provider as soon as you realise it’s gone and stop any further transactions taking place, as well as possibly getting a refund for any purchases not made by yourself.

Tip: keep a record of your card providers’ emergency number, especially if you don’t have internet access where you’re staying.

Spread the cost

Another benefit to taking your credit card is that you can spread the cost of purchases. Should you have struggled to save up all the spending money you need, by using your credit card you’ll be able to do everything you’d planned and pay off the balance when you get back. Of course, only spend what you know you’ll comfortably afford, but some sensible budgeting to make the repayments will allow you to squeeze every ounce of enjoyment out of your much-needed break.

Section 75

Another practical advantage of taking your credit card away is known as Section 75. This refers to a level of credit card protection which covers any purchases made between £100 and £30,000 – providing there are no third parties involved in the transaction. Whether you’re abroad or in the UK, the card company is responsible - along with the retailer - if anything goes wrong with a purchase you’ve made. So, using your credit card for any bigger purchases could give you another level of cover while you’re away.

Things to consider

Foreign transaction fees

If you do decide to take your credit card with you, there are a couple of things to bear in mind. First off, is foreign transaction fees. Credit card providers typically charge around 3% of what you spend in each transaction, and between 2% and 3% every time you get money out of an ATM, so being aware of this will prevent you getting an unpleasant surprise when you check your balance back at home. Checking with your lender to see how much they charge will allow you to factor this into your holiday spending.

Interest charges

The second thing to remember when using your credit card abroad is the interest charges you’ll pay on top of your balance - if you don’t clear it in full when you get home, that is. Since all credit cards charge interest on any outstanding balance not paid each month, keeping this in mind when spending abroad will prevent your holiday costing more than you budgeted for.

Spending too much

One potential pitfall to taking your credit card on holiday with you is the temptation to splash the cash and get carried away. Of course, you want to enjoy yourself, but if you have a generous credit limit to play with, you could find yourself in difficulty once your trip’s over if you don’t keep an eye on your balance. Setting yourself a daily budget (and sticking to it!) could be a simple way of getting around this issue.

Alternatives to taking your credit card


As previously mentioned, there is always the option to take cash on holiday. While this could be advantageous in terms of budgeting and knowing how much you have to spend, it doesn’t come with the security that a credit card does, and if the cash is lost or stolen, it’s gone for good. You could also get stung by a worse exchange rate if you have money left over that you want to sell back, as all currency providers offer two different rates for buying and selling foreign currency.

If you opted for travel insurance, this might cover you if your cash is lost or stolen, however, this varies from policy to policy, and you’re unlikely to get any money back before you return home.

Tip: If you do take cash on holiday, try not to carry large amounts at one time, and leave money in a secured place - preferably a safe in your accommodation.

Prepaid cards

Another alternative to a credit card is prepaid cards. They involve you loading money onto the card before your holiday and can be used in the same way as a credit or debit card when spending.

Since you can put on however much you want, these allow you to budget more than a credit card might. Plus, if you lose your prepaid card, your money will still be safe if you contact the provider to block your card.

However, if you don’t put enough cash on your card to begin with, there will be a charge to top up your prepaid card using your credit card. It’s also worth remembering that prepaid cards have a limited shelf life, so if you come home with money left on it, once the expiry date is reached the money will be lost.

Finally, unlike with a credit card, you won’t get the cover you might by Section 75 protection with a prepaid card.

Debit card

Using a debit card abroad can be an expensive way to spend. If you use your debit card to withdraw cash you could be charged anywhere between £1.50 and £5 per withdrawal, and a minimum of 2.75%-3% per debit card transaction. Again, it’s important to do your homework to find a debit card suitable for withdrawing abroad.

If you do plan to pack your credit card, just remember to look out for those transaction fees and interest charges. It could work out to be cheaper than the above options, but you’ll need to do a bit of research before you go! To get the best out of using your card, make sure you stick to your holiday budget and only ever spend what you can afford to repay.

And remember, whether you’re taking a credit or a debit card, you’ll need to tell your provider when you’re jetting off, so you won’t be faced with a blocked card when you arrive!

Disclaimer: All information and links are correct at the time of publishing.

author: Bryony Pearce

By Bryony Pearce

Should I take my credit card on holiday? Should I take my credit card on holiday?