Vacationing on a Dime (or a Pence)

Despite our newly frugal ways, we did slip up a bit and go on a vacation to London last week. My husband Bill was already there on business, meaning his company was picking up the tab for our lodging and per diem meals. All we had to do was get there and enjoy ourselves. Thankfully, we were able to secure a great last-minute fare for the three of us, and off we went.

London just happens to be the second most-expensive city in the world (Moscow is number one). Needless to day, we experienced a bit of sticker shock the first time we opened our wallets and had to shell out almost £2 (or almost $4) for a small bottle of water or £7 (close to $14) for a day-pass on the Underground. (By comparison, a one-day “Fun Pass” on New York City’s subway system is $7.)

Obviously, we were going to have to figure out how to stretch our dollars, er pounds (£, FYI), in London if we were going to return home with only souvenirs to speak of and not too much debt. Once we got our frugal bearings about us, we figured out the following money-saving schemes, many of which I think would apply to travel to other international locations as well.

1. Exchange Currency on the Cheap
Currency exchange shops were everywhere in London, seemingly outnumbering newspaper vendors and taxis. These places make their money by surcharging you for any currency exchange they do for you–often cutting in quite a bit to how much money you actually pocket after the transaction. We quickly discovered that the cheapest place to exchange currency in London was at the post office, known there as the Royal Mail. When we visited the main branch of the Royal Mail near Kings Cross railways station, the clerks there were happy to give us pounds for our dollars with nary a surcharge in sight. In other words, they did it for free. Given the current exchange rate, where you have to spend about $2 to get one pound, every penny–or pence–counts.

2. Use ATMs and Discover How to Avoid Bank Surcharges
Still on the topic of currency, we discovered that withdrawing money from an ATM was also an excellent way to get money in our pocket without paying a hefty exchange rate. However, we were still subject to ATM commissions, which often add up to one to two percent of the withdrawal amount. Thankfully, these commissions are one-sided only (the banks in London), because we are “crown” members of our bank back home. That means that they will waive two ATM withdrawal fees at non-member banks each month, and since we made only two withdrawals in London–and hadn’t used up our quote henceforth–we didn’t have to worry about having extra fees tacked on. You may want to look into upgrading your back account status before leaving on a foreign trip so you, too, can reap these ATM benefits.

3. Public Transit Isn’t Always the Cheapest Option
As I mentioned earlier, we paid £14 pounds for a day pass on London’s Underground. That was for each person. Thankfully, we got a cheaper rate for Jane, who at age 11 could get a day pass for £2. Annie, being only 10, rode for free. Nonetheless, we were spending £30 in a day to ride a train. We did use the Underground quite a bit and probably got our money’s worth. However, it was a bit sobering one evening when we “splurged” and took a taxi back to our hotel. For the four of use to ride, clear across town, we shelled out £15 only. (Of course, walking is my favorite mode of transportation and always free. It was our number one fall back when the Underground or a taxi just wasn’t worth it.)

4. Your AAA Card Works Abroad
We discovered (after the fact, sadly) that our hotel would have given us a AAA Discount on our room. Who’d have thunk that an American Automobile Association membership would have been worth anything at all overseas? In fact, the AAA website offers a “search for savings” option that includes international destinations.

5. Remember Your Dollars and Sense
It’s very easy to forget all about exchange rates in a foreign country when pound signs (£) seem to have become interchangeable with dollar signs ($). You start to believe that you are getting good deals on things, because they “seem” to cost less than they do at home. We had to keep forcing ourselves to double the price on anything we wanted to buy as a way of reminding us that, no, £19.99 (or nearly $40) was not a good deal on a street vendor’s pair of earrings. This doubling reality became doubly real when I stepped into a Gap store and saw that Gap jeans, which I’ve purchased for $49.50 in the US, cost £49.50 in London. Holy markup, Batman, that’s almost $100 for a pair of Gap jeans.

I’m happy to report that we arrived home safely yesterday with a suitcase half-filled with trinkets, souvenirs and even some clothing (the £5 rack at Harrod’s department store was our best find!). More importantly, we arrived home with our wallets half full as well. Hey, that’s better than totally empty!