Enjoying the sun on a subtropical beach, exploring a steaming rainforest, skiing on challenging slopes in the Alps … It is no wonder that we are looking forward to a holiday. For some, a journey is so desirable that they consider taking out a loan for it. Have you ever caught yourself at that idea?
Necessity of life
Over the past fifty years, the holiday has grown from a luxury activity to a mandatory diet. Where we used to be happy when we reached the Ardennes in the Ugly Duck, nowadays we prefer to travel intercontinental. And not once a year, but two or three times. We could say that vacations have become the necessities of life. We also continue to go on holiday in times of economic crisis, according to various studies. We hardly cut back on our journeys, because they have become an essential part of our leisure activities. For many, it has become more or less the goal of our work: we live from vacation to vacation.
Concealed loans: the installment holiday
The great need for vacations, coupled with the popularity of consumer loans, is fertile ground for creative tour operators. Corendon, for example, offers travelers to pay for their journey in installments. Easy right? Yes, but expensive: the interest on these monthly payments is up to 15%. That is comparable to the interest on a credit card. The difference is that with most credit cards you do not pay interest if you pay off within a month.
Borrowing money to travel, it is actually crazy. We should only apply for a loan if we invest in something. A house is a good example of this, or a new venture. Less often we could also count a car here: you are more likely to use it at work, you transport freight with it and you are not bothered by the elements. You do have to deal with the depreciation.
Sure, we could also consider a journey as an investment: an investment in our mental well-being, for example after a stressful period at work. But it is not a financial investment. But not if you have a job interview at the destination with the chance of a better job. But let’s not fool ourselves; a journey is not strictly necessary, is not a necessity of life and is not a financial investment. Those who think wisely are careful with this type of expenditure. And with caution, there is no loan.
The solution: simply save
Whether you go on holiday for two weeks or want to go on a world trip for a year, you need a budget for this. The best way to put that budget together is to save for your trip. This means that it may take a little longer before you can actually pack your bags, but you don’t have to put yourself in debt. If you still choose to take out a loan, then the interest of comparing loans is actually a must. The interest is of course very important, but also look at other conditions. What is the duration? And can you, for example, pay off the remaining amount early?