Is it worth changing euros for the summer holidays now?

This will indirectly reduce the cost of hotels in the eurozone (so Spain, France, Greece and the rest, but of course not Turkey) for Brits, and directly reduce the cost of fuel, eating out, day trips and more once there. No surprise then that my Twitter feed is jammed with tweets similar to this by Joe Bathurst:

"With € so low against £, is it worth paying holiday balances (in €s) & stocking up on €s now or saving money until due date?"

So let me be blunt. I don't know. Nor does anyone else. Currencies move – it could get better or worse or stay the same. Even professional currency speculators don't always get it right.

The recent fall has been because of the continued decline of the eurozone economy. Last week's announcement of quantitative easing (printing money) and the Greek election results all mean the currency is weakened and its interest rates are likely to stay low longer (1). However, the euro rate for people in the UK right now is very good compared to the past few years, so you may decide it's good enough for you and you want to lock in right now and then not worry if it gets even better.

The upside of that is you get surety of a decent rate – the downside is that if the euro continues to weaken, the rate could get even better. You need to decide whether the upside outweighs the downside for you. How to lock into the current rate There are a few different easy ways to do this:

• Get yourself euro cash. To do this, use our Travelmoneymax.com Travel Money Comparison, which shows you the best all-in rate for collection or delivery. However, be sure you've somewhere secure to put the cash. Some travel bureaus let you buy ahead and then send you the rate nearer the time, but do this, and if the bureau went bust, you'd likely lose your cash as there's little protection. So be careful.

• Load up a prepaid card. These are effectively modern-day travellers’ cheques but used like a debit or credit card. You must load cash up on them in advance and the rate you get is the rate on the day you load. But don't assume the cards are all the same - there can be huge differences in rate. See our Top Prepaid Travel Card info for a rundown of the best right now.

• Get a UK euro bank account. This is only really worth doing if you often travel to Europe (perhaps you own a holiday home) – or spend substantial amounts. A few UK banks offer these including Citibank, Barclays and Lloyds Bank (monthly fees may apply, so check before applying). They operate as a normal bank account but in euros. If you're depositing cash the bank will usually do the conversion for you, but be careful as the rates are often awful – so don't do it automatically, check in advance.

  You can often call the bank to try and negotiate a better conversion rate (especially for larger amounts). Alternatively use one of the international money transfer firms to deposit the cash there for you.

• Send money to an overseas bank account. If you have an overseas euro account (again, likely for those with second homes in Europe), then sending money to it will do the job. However, watch the conversion rate. An international money transfer firm will often improve it for you.

Or just bag perfect rates whenever you go

My personal preference isn't to play the market, it's just to get the best rate whenever I go (see My Overseas Wallet blog post). This way I'm not speculating one way or the other, just ensuring I get the best value.

The easy way to do this is to pocket a bureau-busting, specialist travel credit card giving near-perfect rates on spending every time in every country. Unlike most cards they don't add a 'load,' instead you get the same great rate the bank does (see the Top Overseas Spending Cards guide for full info).

The top pick card is the Halifax Clarity due to it having the lowest ATM fees. Of course you need to ensure you repay it IN FULL to minimise the 12.9% rep APR.

As with all credit cards, you will need to pass a credit check to get it, and there are easier-to-get cards. So use the free Overseas Card Eligibility Calculator to show which you're most likely to be accepted for.

PS. After writing this article quite a few people are now asking me whether it's worth buying US dollars? The dollar is currently at £1 buying $1.50, which isn't a particularly great rate; a few months ago it was at $1.70. So certainly looking at recent rates there's less reason to ask this question now than with the euro. But the logic is still the same… it could get better, worse or stay the same. So it's more of a question of what rate are you happy with?

FOOTNOTES

(1) For those wondering why low interest rates means a currency weakens, here's a very quick bit of basic economics. Interest rates are what you earn to hold money, if you drop the rate, there is less demand, so the currency weakens. If you think about it, would you prefer to put your savings in a currency where you could typically earn 5% interest or 0.5% interest? The first of course. So a higher interest rate (as long as there's not runaway inflation), tends to mean a stronger currency.