4 min read

Person enjoying hot springs on a dream vacation.

A vacation may not be in your immediate future, but anticipating a trip can bring you happiness and give you something to look forward to. Even if it takes some advance preparation or vacation financing to make it a reality, you can still plan for your dream trip. Let’s examine some strategies to help make it happen, including building up savings, book now pay later vacations, credit cards, and personal loans.

Start saving now

If you can set aside some amount of money each week or each month, you’ll have a chunk of cash available when it’s time to go. Can you earmark $50 a week for the next six months? If so, you could have more than $1,000 to spend. Consider setting up an automatic transfer from your checking account to a savings account on paydays to make it simpler. For example, you could save through the fall and winter months to pay for next summer’s vacation. Saving for a tangible goal is exciting; as your dollars add up, you can flip through magazines and guides to plan the perfect trip.

Use a travel credit card

Travel credit cards frequently offer perks that might help lower costs for your next trip, whether they’re offering airline miles you can put toward a ticket, rewards points you can apply to travel purchases on the card, or cash you can put in your bank account. As always, make sure to note the terms and conditions.

Get a 0% interest credit card

If you qualify for a credit card offering no interest for an introductory period, you can use the card to book your vacation and pay the expense off over time.

Be certain you understand what the regular APR will be and budget for payments for that rate, just in case you aren’t able to pay it off before the interest rate converts.

Book now, pay later vacations

Rather than use your higher-interest credit card, you can buy your getaway through travel retailers. Many cruise lines, hotels, and airlines offer “book now, pay later” vacations that let you set your travel plans in advance, then pay for them over time. How this kind of purchase works can vary depending on what you’re buying and which company you’re buying from.

You may have to pay some of the balance up front, for example. Terms may also change if you’re booking a single part of your vacation (such as a flight or a hotel) or if you’re choosing an all-inclusive package that includes travel and lodging. The travel retailer may use a separate vendor for financing, so your purchase might not be as simple as it appears at first glance.

Before choosing the book now, pay later option, always make sure you get a clear picture of the payoff terms. If you’re not able to pay off your purchase by an agreed-upon date, you might be able to finish paying it off after paying a penalty (such as a higher interest rate or a late fee) or you may forfeit your booking entirely. Check their cancellation policies too in case you’re not able to take your trip.

Tip: Check the Better Business Bureau for recent complaints about travel companies and any financing partners before deciding to purchase a book now pay later vacation.

Apply for a personal loan

A personal loan could cost you less in interest than putting your vacation expenses on a credit card or using third-party financing. Because it is an installment loan, a personal loan offers the predictability of a fixed rate with fixed repayment terms. Your rate won’t go up for the life of the loan and your repayment terms tell you exactly when you will finish paying off your loan. Having that consistent payment and those friendly terms can also help you create a budget so you have extra spending cash on the trip. This will all have the benefit of helping you keep your long-term finances healthy while getting to go on vacation in the short-term.

Tip: Make sure you include your monthly payments in your budget so you can keep up with your loan.

Dreaming about where you want to go later can brighten any day. Maybe you want to see the Great Wall of China, relax in a villa on the Amalfi Coast, or spend two weeks in the lush jungles of Thailand. With vacation financing, the world could be your oyster. No matter what strategy you take to finance your vacation, don’t be afraid to plan a memorable vacation — you’ve waited long enough, it’s time to get traveling.

Thinking about a personal loan to finance your trip? Check Your Rate