Financing your post-pandemic dream holiday

Now that borders are opening and the world is our playground once again, you have likely been dreaming of a post-pandemic dream holiday. With romantic escapes in Britain beckoning and Palazzo di Puglia calling for princely sums, you may be wondering how to finance your fanciful escapade abroad. Here are some insights into financing your post-pandemic dream holiday.

Get a fix on your budget

If only money was no object – for most of us, it is. Though you may have money saved up, this shouldn’t be the endpoint for your dream holiday budget. How much can you afford not only to spend but take off in the middle of a busy year? If you’re still working, you have options to finance your dream holiday abroad, which we’ll delve into later. Your budget may also be tempered by ‘digital nomad’ options – where you could theoretically extend your stay provided you can work remotely.

Are you prioritising luxury over adventure?

How does one holiday? As one likes, naturally. But do you prioritise luxury and decadence over adventure and roughing it? The money you save on accommodation could be spent on spreading yourself over numerous out-of-the-way destinations – or perhaps you feel like pampering yourself with Venetian sun for a week, engorged on fritto misto without a care in the world. Sounds like heaven to us.

Put the credit card away

If you’re thinking of putting as much of your trip on the credit card – and some credit cards do tout generous rewards points and the like – it may end up costing you much more in the long term. Once you’re in the country, you’re also stung with international transaction fees ranging anywhere between 2%-5% – and foreign conversion fees by your bank and the ATM in the country. Credit cards are also a form of revolving credit – which means you could be paying interest on your balance indefinitely unless you make a conscious effort to eliminate the debt; which could take a while. You can avoid interest – but how many of us can come up with tens (perhaps hundreds) of thousands of extra dollars within a  narrow 55-day interest-free period?

Looking at personal loans

To finance a dream holiday, you should look towards personal loans. A sure-fire way to save money on your trip overall is to compare the best personal loans available on the market. Personal loans may be a bother to take out, but they have drastically lower interest rates than credit cards (sometimes in the vicinity of 10-15%p.a.) and each repayment you make inches you closer to a zero balance. You can also budget for the repayments much better than a credit card, as most personal loans carry a fixed rate and identical monthly repayments. The more you spend on your credit card, the more your minimum balance is (and the overall balance if you want to avoid interest altogether.) This way, you spread out the holiday costs over time while you get to enjoy your dream destination right now.

The information presented here is general in nature. It should not be a substitute for professional financial advice.