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Last updated on April 17, 2014 at 8:59 EDT

Gappers: Keep Covered and in Control on Your Gap Year

July 9, 2012

CHESTER, England, July 9, 2012 /PRNewswire/ –

        - MoneySupermarket provides key tips for those planning a gap year this
          summer

With over 200,000 young people in the UK planning to take a gap year*, and an
increasing amount of older gappers on a career break or in retirement, Bob Atkinson,
travel expert at MoneySupermarket.com offers tips to help those travelling to spend their
money wisely and keep safe abroad.

Funding Your Gap Year

Although many people planning a gap year will be funding their travels through savings
or money earned while abroad; a number will be looking at other alternative ways to pay
for their trip. Using a credit card designed for overseas usage which also offers zero per
cent on purchases can help spread the cost of travelling. For example, the Nationwide
Building Society Select Card offers 0 per cent on purchases for 12 months. It also offers
no commission charges when making purchases abroad – however, you need to be a Nationwide
FlexAccount customer to open the card. Alternatively, borrowing on a personal loan may be
an option for some travellers. Borrowing GBP5,000 over 5 years with the marketing leading
Derbyshire Building Society Personal Loan at 7.6 per cent would cost GBP99.83 per month,
with a total cost over the term of GBP5,990.

Bob Atkinson, travel expert at MoneySupermarket.com
[http://www.moneysupermarket.com/travel-insurance/gap-year ] said: “Anyone looking to
borrow money to fund their gap year should think carefully before they sign up to any
deals to make sure they can afford to make the required monthly repayments. Using a zero
per cent credit card which is also designed for overseas usage is a good way of spreading
the cost of the trip. However, make sure you set up a direct debit to meet the minimum
monthly repayments and have the required funds in your bank account. Alternatively if you
want to spread the cost of the trip over a longer period, a personal loan could be a good
option, but again you need to make sure you have the funds available to meet repayments.”

Spending Abroad

        - Plan ahead- cash and prepaid cards abroad

Waiting until the bureau de change at the airport could mean you pay a significant
amount more for your currency. Order cash online before you go for delivery or collection,
and if you need to exchange currency while away, ensure you shop around to find the best
deal.

Pre-paid cards can be great alternative to cash. Many offer competitive exchange rates
on foreign currency and some come without the sting of withdrawal and purchase fees. The
lack of credit facility on these products means you can’t spend more money than you have,
helping you budget when overseas. For example, CaxtonFX Global Traveller currency card has
no charges for ATM or purchases abroad. Make sure you use a card which is designed for the
currency you are using, otherwise you could end up paying additional fees. Pre-paid cards
can also be quickly loaded online so if you run out of cash while away, or need emergency
funds, they are a useful tool.

        - Check your plastic is overseas friendly

If you’re planning to use a credit or debit card while abroad, make sure you use one
which is specifically designed for overseas usage. The Norwich & Peterborough Building
Society Gold Current Account for example, offers no withdrawal charges, retail transaction
charges or handling fees when using abroad. Using a credit card for ATM transactions
abroad can be expensive as interest is charged daily. Only the Sainsbury’s Gold Credit
Card charges no interest on ATM withdrawals if the balance is paid in full at the end of
the month. However, the card does come with a GBP5 monthly fee and the ‘free’ travel
insurance is unsuitable for anyone on a gap year trip.

Protection when abroad

        - Gap year travel insurance

Heading abroad is an exciting time for many travellers, and thinking about things that
could potentially go wrong will rarely be front of mind when planning adventures. It is
crucial, however, to have adequate insurance in place, and many insurers cater for the
adventurous traveller with policies designed specifically for a gap year. Some providers
will offer cover for sports activities within gap year policies, although these activities
and levels of cover vary depending on the provider, so it is important to read the policy
wording carefully for caveats and small print.

The cost of comprehensive insurance cover for the entire duration of your trip doesn’t
need to break the bank and will not only put your mind at rest, but offers peace of mind
to friends and family as well. For example, twelve months worldwide cover from Insure &
Go’s Backpacker Light policy costs GBP163.71 and provides cover for up to three bungee
jumps and offers additional cancellation cover and also meets MoneySupermarket’s
recommended minimum level of cover.**

        - Instant overseas transfers

Many providers offer international transfer services which can be great peace of mind
for parents who need to top up their children’s funds when caught short abroad. It pays to
shop around, and many providers such as HiFX offer competitive money transfer deals. Look
out for fees including transfer charges and overseas bank receiving fees. Many companies
may also load an exchange rate despite claiming to be ‘commission free’ so ensure you’re
aware of all the possible charges involved before you transfer.

Bob Atkinson, travel expert at MoneySupermarket.com said: “For anyone taking time out
to travel and explore the wider world or opting for a longer, more intrepid getaway, it’s
vital that you consider every aspect of the gap year
[http://www.travelsupermarket.com/c/guides/round-the-world-flights ] before you go.

“Budget for all you may need to spend before you go- this will need to cover your
travel and taxes as well as transfers, accommodation costs and food. Keep track on your
overdraft, especially if you plan to use this as a back-up – be aware of any charges and
stay within your authorised limit. There are many banking apps which can help you keep
tabs on spending, or register for online banking while you’re away.

“Planning is vital when it comes to gap year finances and having the right products in
your backpack will keep you covered, calm and in control. There’s nothing worse than
getting stranded with no money or returning to find a hefty bill on your doormat simply by
not planning ahead.”

Notes to editors:

*17-28 year olds, according to http://www.gap-year.co.uk

** MoneySupermarket recommends at least the following level of cover:

        - GBP2m for medical expenses
        - GBP1m personal liability
        - GBP3000 cancellation - or enough to cover the total cost of your holiday
        - GBP1500 baggage
        - GBP250 for cash
        - Policy excesses under GBP100
        - Cover for scheduled airline failure and end supplier failure is desirable
        - Delay cover (e.g. GBP20/hour for first 12 hours).

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        For further information please contact:

        Paul Lawler
        PR Manager Financial Services
        +44(0)1244-370317
        paul.lawler@moneysupermarket.com

SOURCE moneysupermarket.com


Source: PR Newswire