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Wednesday, April 25, 2012

Best destinations for the strong Australian dollar

Strong dollar sees Australians flocking overseas

 But theft and currency rates remain a big concern

Australians are travelling overseas more than ever thanks to the strong dollar, and 68% say they'll spend more overseas while it remains high, according to new Galaxy research commissioned by leading currency specialist OzForex.

Certain global destinations are the cheapest they've been for decades, with Europe at the top of the list.  Three years ago in April 2009, $1 Australian would buy you 0.55 Euros.  Today it buys you 0.79 Euros - an increase of more than 43%.  OzForex CEO Neil Helm says it's worth taking advantage of.

"From Paris to Berlin, that's a massive jump in your spending power.  Travellers can thank a lack of confidence in the Euro as a result of problems in Greece, Spain, Portugal and other European countries for the bump."

In second place comes the US, where you get 42% more for your money: three years ago $1 Australian bought 72 US cents, now it buys well over $1 US.  The third best value is found in the UK, where the Australian dollar is still up an enormous 33% on the pound.

"That still might not make a notorious London latte good value, but it's certainly a great boost for Australians visiting the UK for the Olympics this year," says Neil Helm.

Closer to home, Thailand is also excellent value.  In 2009, you'd get about 25 baht for your dollar. Today, you'll net about 32 - a rise of almost 24%.

But while Australians jet off overseas, the vast majority are still stressing about exchange rates and fees, as well as the security of their money.

According to Galaxy, 87% were worried about theft and loss, even though 17% prefer to take cash than cards on holiday.  Younger and more frequent travellers also preferred cash.

And although 83% worry about transaction costs, the majority still use credit cards when they travel despite the higher fees that these incur.  Just 14% use pre-paid multicurrency travel money cards, which are specifically designed as a convenient and safer option for those travelling overseas.

"OzForex's new multicurrency Travel Card aims to take the headache out of travel by letting you choose when you want to lock-in exchange rates, you're not at the mercy of the markets," Neil Helm explains.

"And because we're a currency specialist, not a bank, we can offer very competitive rates, and we've been able to slash fees.  So there's no extra charge for putting money on your card, and it's much more secure than carrying cash."


Outbound tourism statistics

Outbound tourism numbers and expenditure are soaring.  Government figures show over 7 million resident outbound departures in 2011 and this is forecast to reach over 10 million by 2020.

In the September 2011 quarter, net expenditure overseas saw the first positive result in 10 years according to ABS statistics:  $254 million more was spent by Australians overseas, than by foreigners in Australia.  This is partly due to a fall in tourism, but also to an increase in Australians travelling and spending overseas.

Galaxy research findings
  • 48% find bank transaction fees hard to understand
  • 83% worry about exchange rates and fees overseas
  • 14% currently use pre-paid cards
  • 91% would find a pre-paid card with locked-in rates useful
  • 68% say the strong dollar will make them spend more

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The Expeditionist

The Expeditionist
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