British Travelers Are Losing $550M Each Year Because They’re Bad at Math

British travelers are overspending on holiday by around $200 per person due to erroneous currency conversion.

British vacationers are unintentionally overspending on travels abroad by nearly £350 million, about $550 million, each year due to confusion over currency conversion, according to a study by consumer credit firm Barclaycard.

Barclaycard’s Holiday Habits study recently found that 52 percent of British holidaymakers attempted to track their spending by converting foreign currency into pounds, but 28 percent of these attempts were mistaken. This resulted in 45 percent of vacationers spending on overpriced items and 36 percent of tourists buying items they otherwise wouldn’t choose.

Twenty-seven percent ran out of money altogether due to currency conversion errors.

“Many people do try to stick to a budget when on holiday, but things don’t always go to plan,” said Barclaycard CMO Katherine Whitton. “Currency conversions you do quickly in your head can often lead to a big headache later.”

In early June, Barclaycard, via Opinium Research, surveyed 2,006 U.K. adults online, asking about their holiday habits in the last two years. The research found respondents’ miscalculation was due to:

• Forty-four percent struggled with mental currency conversion.
• Forty-percent said they panicked while making quick decisions.
• Thirty-seven percent failed to remember the correct exchange rate.
• Twenty-four percent miscalculated after a few alcoholic drinks.

As a result, vacationers lost an average of £127, about $200, each.

Barclaycard found that extravagant designer purchases are the main culprits, at 16 percent, for overspending abroad, followed by 15 percent of respondents overspending on dining, 12 percent on gifts and 10 percent on souvenirs.

Barclaycard is a consumer-credit unit of Barclays Bank PLC and processed over $390 billion in transactions globally in 2014.

[Photo: iStock]