7 WAYS TO TAKE CONTROL OF HOLIDAY COSTS
If you have a dream holiday in mind, start saving as soon as possible. By saving consistently, you’ll have more chance of being able to pay for a large chunk of the trip without needing to use credit to fund it. Start a holiday savings account and set up a standing order to put something away regularly – get into the savings habit by putting away a small amount that you won’t miss too much each week/month, then increase it gradually to the maximum you can afford.
Many people choose to pay for holidays with credit cards, as it can be convenient and allows you to pay it off at a later date. But it’s important to remember that ultimately, you have to repay the debt. So, the less you put on credit the better. Not only will it make it less painful when it comes to repayments, it will also help ensure that you don’t damage your credit score by biting off more than you can chew.
LUXURY VERSUS NECESSITY:
Remember a holiday is a luxury, not a necessity. Overstretching yourself on credit to pay for a trip can leave you struggling to buy essentials, or you could be floored by an unexpected bill on your return. Be realistic about your budget and what you can afford.
Before putting your next big holiday on credit, consider how you’ll pay it off. If you’re looking to fund it using a credit card, make sure you’ll be able to pay off any balances in a timely manner to avoid paying over the odds in interest. Or worse, getting behind with repayments and damaging your credit score.
BE CAUTIOUS WITH CARDS:
If you need to apply for a new card to fund your holiday, be careful not to make multiple credit applications in quick succession. Why? Because many lenders view multiple credit applications within a short period of time as a red flag, as it suggests you may be desperate to get your hands on credit. If you’re considering applying for a credit card, sign up to Noddle at Noddle.co.uk and use the free card matcher tool to see which cards you may be eligible for before making an application.
AVOID HIGH CREDIT BALANCES:
If you are using credit to finance your summer trip, make sure you tread cautiously and don’t spend too much of the credit limit available on a card. If you’re unable to manage your repayments and can’t show you’re bringing down the balance, it could signal to lenders that your spending has got out of control or you are experiencing financial difficulty.
By regularly checking your credit report you can keep an eye on all your financial commitments which will help to ensure you stay in control of your finances.
CONSIDER STAYING LOCAL:
In the last few years, the UK pound has lost some of its value compared to foreign currencies such as the euro and the US dollar. This means you will be paying more to travel abroad and costs in resorts will be more expensive too. This will increase the likelihood you may have to use credit to afford the break. Would it be worth considering a “staycation” and decreasing your costs?