by Susan Paige
Let’s be honest – taking a family vacation is just too expensive. Although letting your kids experience the world while making memories as a family is priceless, it is often hard to save up for and justify taking a vacation. One solution is to take out a vacation loan, which you can pay off over time after your trip is over. This might seem like an easy fix and an option that is easily worth it, but the truth is that the cons and negative impacts of a vacation loan on your family’s finances might outweigh the benefits.
Here are a few pros and cons to consider before taking out a vacation loan.
Potentially Low Rates:
For buyers with certain qualifications, such as high incomes or high credit or FICO scores, personal loans can have low annual percentage rates.
Get a Lump Sum of Cash:
When you take out a personal loan, you receive the funds all at once, rather than receiving money over time as you spend it. Having a set amount of money available for a vacation can help you plan your trip and stick to your vacation budget, without being tempted to go overboard.
All personal loans have fixed monthly payments over a set amount of time, which means you can plan for them easily. Knowing when you’ll pay off the debt can help you budget your family’s finances accordingly.
If your family is struggling financially to the point that you’re unsure you can afford a vacation, adding a personal loan to your existing bills could create even more financial stress. Missing a payment could have an immediate, negative impact on your credit score, not to mention you run the risk of racking up late fees while you are still accruing interest, meaning your vacation will end up being much more expensive than it would have been if you had just saved up and paid out of pocket.
Lengthy Payment Terms:
Payment terms on personal loans for vacation can range from 2-10 years, meaning you could still be paying for one vacation long after you’ve returned home. Think about whether or not a trip is worth it, or if it would make sense to spend a literal decade (or close to it) paying for one trip before heading to the bank to take out a loan.
There are many pros and cons to taking out a personal loan to pay for a vacation, but if you or your family are already struggling financially, it might not be worth it. Vacationing can be done on a budget – you don’t need to charter a jet from accessjetgroup.com or stay at an all inclusive luxury resort to give your family a memorable trip. Cut down on the costs of traveling with some research and budgeting, and take a much needed vacation that you won’t be paying for for years to come.