To Australian travellers: how to get the most out of the strong dollar (everyone else, look away!)
The Australian dollar is soon predicted to hit parity with the US dollar.
While the local tourism authorities (and the education sector) are probably going to have a lot to worry about, there's one group it's good news for: Australian travellers. Is that you? Here's how you can make the most of a good situation:
The news focus might be on the Australian dollar vs the US dollar, but it has also strengthened against a whole lot of other currencies. The US, being far away, tends to be more expensive to get to. Besides, not everyone might have set the US at the top of their travel list.
That's why savvy Australian travellers should consider visiting destinations closer to home. New Zealand, for example, offers particularly good value. AUD$1 gets you NZ$1.30. That's 30% EXTRA value per dollar. Also a great time for Australian-based Kiwis to take a holiday back home (don't forget to bring presents!).
Slightly further afield, Malaysia is particularly attractive as AUD$1 gets you MYR3.04. That's 300% to the dollar. And things in Malaysia aren't too expensive in the first place! For example, you could have a bowl of laksa in Penang for MYR3. That's the equivalent of one Australian dollar. A similar bowl of laksa would cost about ten times as much back home.
Couple this with the cheap deals that budget airlines such as Air Asia are offering, and you'll have a holiday for not very much. Air Asia for example, runs great sales for one-way tickets to Kuala Lumpur. From KL, you can easily pick another flight to parts of Asia. Air Asia tickets to Bali can drop as low as AUD$125 during a sale. This advice also applies to other parts of Asia. And let's not overlook Europe. That dream holiday might actually be affordable now! Currently, AUD$1 = €0.70/£0.61. Compare this with May this year when the Euro was tracking at €0.66.
If you do want to visit the US, there are ways to ensure that your money goes a long(er) way. You could exchange money while the AUD is high for future use. Of course, you have to weigh this against whether you'd earn more money with interest in a savings account (minus tax on interest of course). And then you'd have to find a safe place to store all that cash (a home safe or safety deposit box at a bank for example).
Another smart tip would be to use a US-based travel agent to book your domestic US air/train tickets or local tours for a future date. Most times, you only finalise payment when tickets are issued. In the case of tour, you could leave a deposit and finalise payment closer to the departure date. This means that booking a ticket/tour for March 2011 might mean you'll get savings if the greenback further depreciates against the AUD.
Gap year and exchange programmes
Another less-obvious thing to consider would be to take a study break or gap year overseas. Or do an exchange programme if you're still at university. Heading off to the US not only offers a cultural kick, but you get bang for buck on everything from accommodation to food.
If you've ever considered volunteering, the strong Australian dollar also means that many of the volunteering packages come down in price as quite a few of them use the greenback for pricing.
Shopping and finance
Of course, don’t forget to leave room in your luggage for when you go shopping on your holiday.
In the US, seek out the many factory outlet malls for big discounts. If you have somewhere you can mail things to (a friend's house, a hotel where you'll be staying at, etc), you can order online to save on sales tax. As long as the item is shipped out of a different state from the one you're in, you won't pay sales tax. For example, an 8GB iPod Nano currently costs AUD$199 in Australia. It costs the equivalent of AUD$153 in the US. That’s almost a good 25% cheaper than buying in Australia.
Electronic goods are particular cheap in Hong Kong and Singapore as well. Please remember to find out if you can claim your tax back on purchases. For example, you can claim the 7% GST on purchases made in Singapore and VAT in Europe. Draw up that want list and get ready to spend!
If you want to use your credit card overseas, look out for cards that don't slug you with fees for using them overseas or for taking a cash advance. A simple Google search should toss up a few options.
Time to start planning that holiday!
Follow Asia-Pacific travel editor Shawn Low on Twitter: @shawnlow
Sign up for our weekly newsletter
Get more travel inspiration, tips and exclusive offers sent straight to your inbox