TL;DR
- 41% of UK travellers plan to spend more on holidays, but 90% are anxious about affordability.
- The pound has strengthened against 25 of the top 30 holiday currencies in the past year.
- Turkey offers the best daily value at £32/day, with the lira dropping 12.9% against the pound in three months.
- Top value destinations now include Algarve (£42/day), Tokyo (£45/day), and Delhi (£40/day).
- Younger travellers (25-34) are budgeting £5,400 per trip, 35% more than average.
Recent research from Aviva and Post Office Travel Money has uncovered a pattern worth knowing about. There’s a genuine psychological tug-of-war happening for UK holidaymakers: many want to book bigger, better holidays, but they’re held back by real worries about whether they can afford it.
The numbers tell the story. Four in ten UK holidaymakers planning a 2025 trip intend to spend more than last year, budgeting an additional £2,982 on average per trip. That’s a significant jump. Younger travellers are even more ambitious, with 25 to 34-year-olds budgeting around £5,400 for an international break compared to a £4,000 average across all age groups.
But here’s where it becomes useful to look closer. When asked if they genuinely feel comfortable with that spending, only 10% said yes. The other 90% expressed real concerns about affordability. Not a lack of desire, but genuine worry about overspending, poor value, or unexpected costs throwing their plans off course.
What to Know About Exchange Rate Anxiety
Exchange rates are weighing heavily on travellers’ minds. A striking 77% of UK holidaymakers say they’re worried about currency fluctuations, and that anxiety is actively reshaping where people choose to go.
More than half (53%) are consciously avoiding destinations where they think tariffs or weak currency will push costs up. Two in five have ruled out visits to the USA entirely, even if it was on their original wishlist.
The good news? The pound is in a stronger position than many travellers realise.
Post Office Travel Money’s Exchange Rate Monitor, published in late 2025, found that the pound has strengthened against 25 of the top 30 holiday currencies over the past year. That’s a conversation worth having with clients who assume everything has become more expensive.
Worth Knowing
Turkey has emerged as the standout for value. The Turkish lira has dropped 12.9% against the pound in the past three months alone, which translates to £116 more spending money for every £500 exchanged compared to last year. Daily travel budgets in Turkey sit around £32 per day, roughly half what you’d spend in many European destinations.
Vietnam has also become more favourable, with improved exchange rates making it an underrated choice for long-haul seekers. Indonesia remains in the top-tier value bracket too, with daily budgets around £48 per day.
The US dollar has strengthened against the pound by 6.6% year on year, making destinations linked to the dollar (including parts of the Caribbean and Middle East) better value than they were 12 months ago. The euro has stayed relatively stable with less than 1% movement, so European favourites like Portugal and Spain continue to offer steady, familiar value.
The Destination Value Landscape
The Post Office Travel Money Holiday Money Report ranked 47 destinations by overall cost, and the results are worth sharing with clients.
The Algarve in Portugal has held the top spot for nine consecutive years. A three-course meal for two with wine costs around £40.33, and total daily holiday costs sit at approximately £42.
Cape Town retains second place despite an 11% rise in local prices, with daily budgets around £52 and exceptional value across experiences and accommodation.
Tokyo has moved into third place. Prices have risen 7.4% year on year, but daily budgets still sit around £45, making it accessible for clients seeking urban sophistication without breaking the bank.
Bali climbs to fourth with a daily holiday cost of £68.88, up only 5% year on year. It remains strong value for families and couples looking at resort-style breaks and wellness retreats.
Delhi is a surprise climber, jumping from 13th to fifth place thanks to a 10.7% drop in local prices. Daily budgets sit around £40, making it ideal for adventurous travellers seeking cultural immersion.
Beyond the top five, Prague has re-entered the top 10 after a 20% price drop. Phuket has returned to the rankings with a 2.7% cost decrease. And for Caribbean seekers, Punta Cana in the Dominican Republic saw the biggest price drop of all surveyed destinations, falling 26% year on year.
The Practical Bit
The data points to a clear opportunity for agents: clients aren’t saying no to holidays. They’re asking for help figuring out where their money stretches furthest.
When a client mentions they’re worried about exchange rates, the conversation can shift from defending against cost to showing them where value has improved. Turkey, Southeast Asia, and even Tokyo now offer genuine value propositions that many travellers haven’t considered.
Younger clients in particular are worth understanding. They’re budgeting 35% more than average, but they’re also the most likely to feel anxious about affordability. Transparent pricing, payment flexibility, and clear breakdowns of what’s included can make a real difference for this group.
Moving from “cheapest option” to “where your budget stretches furthest” is often where clarity starts to appear for clients. They want to know they’re getting something worthwhile for their money.
Agent Advantage Insight
Lead with specific exchange rate data (Turkey’s 12.9% lira drop, the pound’s strength against 25 currencies) to help clients move from “can I afford this?” to “where does my budget go furthest?” Concrete numbers often help clients feel clearer about their options.
