Foreign Perspectives

In theory the answer is simple: when the exchange rate is the best. The only problem with that is that nobody knows when the “best” rate will be reached.

Fortunately there is another approach which works well no matter what the exchange rates get up to and that’s using what’s technically called pound cost averaging. Sounds complicated but what it involves is you buying your foreign currency regularly throughout the time from now ’til your holiday arrives. That way you avoid the ups and downs of exchange rates.

Those ups and downs can be quite substantial too. Over the past year the euro has swung up and down around 12% whilst the pound seems on a steady rise against the dollar (up around 14% over the last 12 months). You might think that it would be better to leave off buying dollars ’til you get an even better rate but we might be at the peak already and just not know it yet.

So how do you go about it? The simplest and cheapest way is to use something like the FairFX card which is free via that link and offers the best rates around. Minimum top-up is only a tenner and you can top-up via standing order which cuts out a lot of hassle. Alternatives are from CaxtonFX (minimum top-up £100) and the Post Office (minimum top-up £50, charge around 3.5%).

Quite a nice way of saving for that next holiday and it should save you money too.

All being well, I will have completed my run-through of the revision notes by this afternoon so that leaves Saturday and Sunday for some last-minute stuff.

My plan at the moment is that I’ll put the books to one side and go through the short question sections of one or two past papers on Saturday with a final read-through of the revision notes over the course of Sunday. That’s if I find I can answer the first past paper from memory, of course; otherwise Saturday will be drafted in as a revision session too. One of the more important things to do is to look at the formulae and constants that are given with the exam paper and check that I know what each of them are for.

Also to be done is assembling all the bits and pieces for the day itself. As it’s a science exam that list is a little bit longer than usual with the addition of a calculator and my drawing set in case I feel the urge to run up a diagram at some point. Also in there are the gel refills for the pens though there’s not so much writing for this one as for the psychology so I’ll likely just use the ordinary refill. I’ve still to print the exam allocation page and track down the passport for id. And, of course, the Lucozade and wine gums. Despite the vast amount of revision I’ve done for this in comparison that for previous exams I suspect there’ll be a number of “wine gum moments” (ie when I’m staring at the exam paper and haven’t a clue where to start).

‘Tis odd to think that this time last year I was working on the Child Development revision. I see from the drastic increase in hits on the site that lots of people are doing that right now.

Although you might expect America to be just like a version of England it turns out that it’s very different in a number of areas, notably in terms of financial sophistication.

One very important point to note from the outset is that foreign exchange is not something that American banks generally deal with. Whilst in England you can change foreign currency in any bank, you can only do that in the largest of branches in America. Also worth noting is that ATMs aren’t as common in America as they are in the UK and you won’t be able to use a cash-back facility so it’s worth carrying, say, $100 in cash.

That lack of foreign exchange facilities means that you must take cash in American dollars. These come in $1, $5, $10, $20, $50 and $100 notes (“bills”) with each one being the same shape, size and colour so you need to look at the amount printed on them. You do get used to that lack of difference quite quickly. The dollar is divided into 100 cents and these come in 25c (“quarter”), 10c (“dime”), 5c (“nickel”) and 1c pieces. There are $1 coins but these are very unpopular and hence rare. It’s handy to take about $100 in cash (preferably in a mix of 10s and 20s); this is available commission (but not charge) free at the Post Office. The downside of cash is that if it’s stolen, it’s gone as holiday insurance rarely covers cash to any significant amount so if you are taking it, limit the amount to $100 or so. If you buy foreign currency on a card, it counts as a cash advance with all the charges that implies.

Travellers cheques (or, in America, “travelers checks”) are much better than cash in that they can be replaced fairly easily if stolen (keep a note of the numbers, date bought and where you bought them). However, they are equally expensive to purchase and there is often a charge to cash them too. In America you can use dollar cheques as though they were cash in shops (even where they say “no checks accepted”). If you have any left over after your holiday, keep them rather than cash them in your bank as you can use them later (there is no expiry date) and this will save you paying the commission again. If you buy travellers cheques on a card, it counts as a cash advance with all the charges that implies. Make sure that your travellers cheques come with the Visa or Mastercard or American Express brands as others may not be accepted.

Credit/Charge cards are used nearly everywhere these days. If you don’t have a card already, you should get one (Visa or Mastercard) even if you only plan to use it for emergencies. Bear in mind that not everywhere accepts them though and also that not all places take both Visa and Mastercard. If pushed, you can get cash on these cards either in an ATM or over the counter in a bank but save this for emergencies only as you’ll get charged a cash advance fee, currency conversion fee and interest. The exchange rate used is much better than you’ll get for either cash or travellers cheques. You will need a credit or charge card to hire a car and to reserve hotel rooms.

Debit cards are almost always branded Visa/Electron/Plus or Mastercard/Maestro/Cirrus and work in the corresponding systems however sometimes you may be issued with a card which can only be used in your own country: check that one of the Visa/Electron/Plus or Mastercard/Maestro/Cirrus symbols are on your card as if they aren’t you probably can’t use the card internationally. Charges are as per credit cards except that you don’t get charged interest on cash advances.

Cash cards are often limited to the country in which they are issued but if they have a Plus or Cirrus symbol on them, you can use them abroad too. Charges are usually the same as for debit cards in ATMs. The principle advantage of having a cash card is that they are a lot less attractive for thieves as they can’t be used without the PIN.

Prepaid cards are becoming increasingly popular with CaxtonFX and FairFX offering excellent value. Both offer cards denominated in dollars, euros and sterling. For travel to America take either the dollar or the sterling cards. Charges on both are broadly similar with Caxton taking a £10 charge (refunded) upfront and having a minimum top-up of £100 whilst FairFX charges a non-refundable £9.95 (but free by clicking on the link here) and have a minimum top-up of £10.

As well as the above options you also have a choice of providers of the various methods of payment. Travellers cheques may be offered “commission free” by your bank (and the UK Post Office), although note that this is not the same as “free”.

If you use one of the banks within the Global Alliance banks (BNPParibas, Bank of Nova Scotia, Bank of America, Barclays, Deutsche Bank and Westpac) you can use machines from one of the other Global Alliance banks without transaction charges (currency conversion fees still apply).

This article is part of our series on holiday planning which covers things like how to book your holiday, how to take your holiday money, what to pack, etc.

I finally managed to get Wendy going on OU study after chipping away for a number of years so all being well she’ll be starting on Arts Past and Present (AA100) in February.

We called in to the regional office this afternoon to have a leaf through the books before signing up. They’ve “improved” the library on their move to the new offices so it now has all the course materials nicely laid out quite a spacious room and with a desk for visitors. The surroundings are certainly a massive improvement on the extremely cramped conditions in the old place. However, whilst there was barely enough room to stand in the old library they somehow managed to keep several copies of every course so you could borrow them for a couple of weeks. Unfortunately, they’ve also “improved” the library by dumping all those extra copies so now it’s purely a reference library. Whilst that’s not a problem for most people, it does mean that it’s no longer possible to borrow the books a month or two before your course starts and thereby make a head start on it. And, no, they can’t give you a copy of the PDFs of the course texts even if you’ve paid for the course.

Also on the shelves are a copy of the AA308 Cities and Technology course which sadly has just finished its last run with no planned replacement (as is the situation with all too many great courses these days). Even sadder is that those books are destined for the bin rather than finding a good home in my house.

Wendy’s got some previous course credits which we will have to see about transferring in at some stage although as they’re from Australia it will probably take a “while” to do.

Slightly complicated in her registration is that the OU keep records of any contact you’ve made seemingly forever so we couldn’t complete the online registration this evening and have to wait ’til they check up on the records manually and send us something to sign.

One confusing aspect of the OU is that it’s difficult to find anywhere that comes straight out and says just how many hours a week a course should take you.

There are all kinds of reasons that they put forward for that but to be fair they do state that 30 point courses should take 8 hours a week and 60 point ones about 16. So that means that a 10 point course takes just under 3 then? No, actually a 10 point course can, usually, take either 8 hours a week if you do it over the 2 month period which most people seem to go for or around 3 if you go for the five month period. I say most because TT280 which I’m doing at the moment is over a fixed 12 week period so should take 8 hours a week. 15 point courses also take around 8 hours a week over about 5 months.

I said “should” above because in most cases I find that I can half those times so 30 point courses rarely take me as much as 4 hours a week and 60 point courses rarely take as much as 6. TT280 is currently taking me under an hour which is a “bit” short of the recommended 8 hours. The difference is down to background preparation. If you already know a fair bit about the subject as I do for TT280 then it takes a lot less than the recommended time.

To muddy the waters a bit they’ve recently started running courses over shorter than normal times. Thus A251 and DSE141 which are both on my short list are 30 point courses that run over 5 months instead of the normal 9 months. The net effect of that is that they require about 50% more time per week than normal 30 pointers so have a recommended 11 to 15 hours (ie 60 point equivalent) and should probably work out as something like 6 hours and maybe 3 or 4 respectively for me due to the knowledge I already have (ie nothing for history, quite a bit for psychology). For me that means that I can’t really do either starting this November as I was toying with doing.