Many Americans find themselves struggling with summer travel expenses long after the season has ended. According to a recent survey by Bankrate, 36% of Americans plan to take on debt in order to travel during the summer months. The payment methods for these expenses vary, with some individuals resorting to personal loans, buy now pay later services, borrowing from family and friends, or using credit cards to pay over multiple billing cycles. It’s important to note that using credit cards to finance a vacation can be particularly costly, as the average interest rate is over 20%, nearing record highs.
Financial experts stress the importance of planning ahead and budgeting appropriately to avoid accumulating debt for a vacation. Setting a budget for different categories of spending while traveling, such as food, activities, and transportation, can help individuals stay on track financially. It’s recommended to identify areas where you can splurge and areas where you can cut back to maintain a balance in your spending.
Once you have established a budget for your trip, the next step is to make a plan to save. Clinical psychologist Sabrina Romanoff suggests starting small by setting aside a portion of each paycheck for your travel fund. Additionally, there are creative ways to save money and make the most of your trips. Taking advantage of frequent flier miles or credit card rewards can help offset some of your travel expenses. It’s also beneficial to consider visiting destinations during the offseason or shoulder season when prices are typically lower due to reduced demand.
When planning your vacation, it’s important to be strategic in your choices to avoid overspending. Romanoff recommends setting priorities for your spending, such as opting to stay in affordable accommodations or cooking your own meals to save on food expenses. By identifying areas where you can save and areas where you can splurge, you can enjoy your vacation without breaking the bank.
It’s crucial to approach summer travel with a well-thought-out plan to avoid going into debt. By setting a budget, saving regularly, and making strategic choices about your spending, you can enjoy a memorable vacation without the financial burden that comes with taking on unnecessary debt. Remember, it’s essential to prioritize your financial well-being and plan responsibly for your travels.