Are you worried about when to book your holidays, and how much it is going to cost you?
The horrifying truth is you will be paying just a little more for your holiday then you intentionally thought, therefore to get much better value for your money go book your holidays now. We all put off our holiday plans until we find the best deal for us, however, if you are worried about the collapse in the value of the pound, I would get them booked as soon as possible.
Fact: The pound has dropped in value roughly 20 per cent against the dollar, and is a little less against the euro. Would you believe this is all happening because of the Brexit vote? The market may have stabilised a little this week however it is difficult to see anyone rushing to buy pounds for some time to come. Investors like certainty, and we sacrificed that luxury on June 23. Unless we have a major break through or something unexpected happens to destabilise the euro or the US dollar, sterling is likely to remain weakened for the upcoming years- two years at its least.
Not only will the decrease in the pound make foreign countries more expensive to visit but it also means that the cost of travelling will also rise, this is due to fuel. For planes or ships. Fuel is priced in US dollars. Beneficially, oil prices haven’t happened to fall just yet and we have been spared some hefty fare rises in the coming months. Prices are on our side at the moment, as not all prices will hit us immediately. Tour operators and airlines know that due to the decrease in the pound, they hedge against it. For those who don’t know, this means they guarantee the exchange rate that they will have to pay in advance. This same process can be used to protect the rising oil prices too. If the pound does increase unexpectedly everyone will lose out. However, few people were predicting the outcome of the referendum. So any airline or tour operators which did buy currency in advance will certainly be better off than most are facing now.
So you are wondering where will your best value be when you book your holidays? All-inclusive packages, you pay everything in sterling in advance and you don’t pay for food and drink in the local currency. This package can be for the sun, the sea or for even skiing. this package will offer you the maximum value in the short term. If you do have a ski package which may also offer the chance to book your lift pass and equipment hire in sterling, this is likely to offer a good value. However, it is best that you do check the euro price that is quoted on the resorts website, this is to ensure you are getting a decent deal.
To put this all into perspective I would book your holidays now before all of this gets out of hand.