Some people believe that it is highly irresponsible to go on a vacation while you are in debt. Many people feel that traveling to your dream destination is a sheer waste of money if you are already grappling with multiple debts because you could have used that money for repaying your debt. But you can travel with great responsibility even if you are having debts and need to tackle the debt situation. If you are having a massive debt, you may take a little longer to pay off your outstanding debts. However, debts could be quite stressful and depressing and it makes no sense to deprive yourself and your family of a relaxing and rejuvenating vacation, until your debts are repaid. Moreover, to carry on without any fun trip is certainly unsustainable and unrealistic. You do have self-control to a certain extent but it is just not possible to sacrifice everything all the time. You need a change of scene and there should be some scope for fun and travel in your current budget too. That is primarily the reason why all healthy budgets including those belonging to individuals in debt, have ample room for traveling and fun. Some individuals are happy dining out, some others simply need to shop, and yet others would love to travel.
According to a new survey by CreditCards.com, mentioned by experts at https://www.forbes.com, most Americans with ever-mounting credit card debt are simply not interested in substantially reducing their overall travel expenses. We understand that 7 out of every ten American adults who are having credit card debt admit that they would refuse to cut down leisure travel expenses. Many people have a passion for traveling and they enjoy a tremendous amount of discretionary expenses and often tend to consider it as something essential rather than something additional. As per the survey, the average household having credit card debt is known to spend $3,188 per annum on leisure travel. Moreover, we understand that travel expenses in the United States qualify as major expenses; hence, it is a good idea to try and curb them.
However, it is fine to travel while in debt provided you keep in mind the golden rules such as:
- Never consider taking on more debt for traveling.
- Stick religiously to your pre-determined debt repayment plan.
Rule #1: Never consider taking on more debt for traveling
Before you make your travel plans, you must examine your bank account. You must make sure that there is enough cash for paying all your travel and vacation expenses. You may not have to use cash for paying for all your expenses but you must ensure that you are having adequate cash for paying all your travel expenses upfront. Suppose you are using your credit card for paying for certain expenses during the trip (which seems like a good idea since it is much safer and even the exchange rates seem to be better), then you must pay off that specific balance at once when it is due. You must have the cash ready to pay off all your travel expenses well in advance.
Rule #2: Stick religiously to your pre-determined debt repayment plan
Suppose you are used to paying $200 every month toward repayment of your debt, you must go on doing that even when you are traveling and out for a fun vacation. If you need to forego the payment towards your debt for accommodating your travel expenses, give up the idea of a trip. Moreover, if you do not have an idea of what precisely is a debt repayment strategy or plan, you simply cannot afford to travel. Drop the idea. You need to sit down and chalk out an effective and realistic plan about the way you are intending to pay off all your existing debt. You need to determine the time-frame and the amount you would have to pay monthly. That is precisely your debt repayment strategy or plan. You better stick firmly to it even when you are making travel plans. You may seek professional assistance from experts at NationaldebtRelief.com for perfect debt solutions.
Some Expert Tips You May Need to Follow
As a traveler with substantial debt, you would be having precise financial needs. We have discussed three important aspects below that may prove helpful to you for traveling.
Set up a Separate Savings Account for Your Trip
You must consider establishing a separate savings account to examine if you have accumulated enough cash for paying all your expenses for your trip. This should give you a psychological boost and mental peace to see your travel money and debt repayment money as two different imaginary stacks.
Opt For Interest-Free Debt
You could, however, consider deferring your debt repayments without any interest charged. You must remember that interest-free debt such as specific student loan programs provided by the government, or certain loans from friends and family, is pretty rare.
In this context, we know that some banks would be providing balance transfers into your loan products at zero percent interest rate for a pre-determined period. For instance, the bank may allow you to go ahead and transfer your existing loan balance straightaway into their offered credit card without any interest charges for the initial 18-month introductory offer. If you are opting for this, remember that interest would be kicking in as soon as the introductory period seems to be over. Consider double-checking your specific debt repayment schedule for ensuring that you would be paying off the credit card balance in advance particularly if your present interest rate is lower as compared to your non-promotional interest rate.
Seek a Job Abroad
Just because you would be traveling in some distant land away from home, it does not necessarily mean you cannot make any money. This idea is certainly not practical in the case of a short trip but it works wonders if you are planning a long trip and would be away for months. You could consider securing a job before leaving for the vacation. You could take up a job at your dream destination. It would be a good idea to make adequate money for covering all your living expenses including your debt repayments.
Conclusion
Managing your money effectively is certainly about trade offs. People must focus on matching their spending with their values. You deserve to enjoy and have your share of fun, but when you are splurging in a specific area, consider reducing spending in some other area. Alternatively, you could take up a side job for earning some extra money. Moreover, credit card debt must be treated as a last resort, simply because it is quite easy to fall into the debt trap but very difficult to get out of it.
