You want to go on a trip, that’s a fact, but be realistic, how are you going to pay for it? Where will you get the resources? There are several ways to finance a part or the total of your trip. You can use your savings, a credit card or even ask for a loan. Each of these three alternatives has different characteristics and it is important that you know them in detail. The idea is that you choose the one that helps meet your goal and, at the same time, take care of your finances.
It should be noted that, for any of the following options, the key lies in planning. Depending on the destination you choose, the dates, duration and means of transport you will use to arrive; You will estimate how much your trip will cost and so you can decide how to pay it.
The first option for you to go on a trip is to occupy your savings planned for this purpose. However, the reality is that many of us find it difficult to save, sometimes, because our salary does not seem to be enough; and it is true, but it is also true that when we go on vacation, and we do it in a hurry, we end up spending more.
The solution to save for your trip and during it, is to prepare a budget and make your purchases in advance.
Having a budget of your income and expenses, will help you identify and eliminate unnecessary expenses that do not generate a real benefit and allocate that money to goals that excite you. This will also allow you to reduce your expenses by at least 20%, without drastically affecting your lifestyle. So eliminate those small tastes or luxuries and allocate that money to your travel savings.
On the other hand, look for ways to increase your income. For this you can work independently for a few hours a day, sell things you do not occupy, start an online business, invest; in short, everything that makes you earn additional income to your monthly salary.
After making all that effort, do not throw it away and update your budget constantly. Finerio can help you with this task, it is the first application in Mexico that allows you to link your bank accounts and register your purchases in cash to have all your expenses in the same place. The application will also allow you to create, among others, a specific travel budget, which will be followed automatically. This way you will know when you are ready to pay for your trip and how much you can spend during it.
2. Credit cards
In this case, you can take advantage of the promotions of months without interest and thus avoid spending a lot of money at once and have a better cash flow. When paying by credit card, make sure you are able to meet the payment in time to avoid interest.
The advantage of the BestDay site is that all year round you can find different packages of lodging, flights and tours for months without interest. You also receive personalized advice.
But first you will need to review the Total Annual Cost (CAT) of your credit card. The CAT is the real interest rate that you will have to assume if you fall behind with your payments. Do you know how much your debt would increase if you pay the minimum amount on your card? Click here
Also, keep in mind that some cards, whether they charge annuity or not, offer additional benefits to months without interest, although under certain conditions.
There are several cards with travel benefits, which offer promotions with some airline, hotels, give access to VIP lounges in airports, special sales, etc. According to the Condusef , many of these cards are designed for people who travel frequently and have at least five international flights a year.
On the other hand, there are cards that give you points for all your purchases to acquire flights. Other cards offer permanent discounts or coupons with certain airlines. In turn, if you pay with your card, some offer insurance that covers accidents, medical emergencies, loss of luggage, among others.
Borrowing money is not the best option to go on a trip, but it is not the end of the world either. Although you should consider that, in general, loans are used to pay large amounts of money over a long term. It is not convenient to suffer paying a debt for months and months after your trip, especially if it was just a weekend getaway.
Always keep in mind your ability to pay, think about how much money you can pay a month after covering your basic needs. Evaluate seriously if you are able to pay your loan. If you are likely to become indebted, better postpone the trip a bit. If the plan continues, choose the loan that entails less interest, for example, there are loans with interest of 8.9% per annum; way below what a credit card charges.
Currently, there are different ways to get a loan. Compare options in both banking and financial entities. Check when you will pay off the debt and what the total cost will be.
Among the models of loans by financial institutions is the so-called peer to peer lending . That is, people who lend to other people, through an online platform. Even your friends and family can finance your trip! What is the advantage? All those who grant the loan will obtain attractive returns and the intermediaries will only charge a certain commission.