Should You Go on Vacation If You Have Debt?

What if you can't pay for a vacation? And you really need one. Badly. Should you ever charge a vacation to a credit card?

It can be tempting to just charge it and deal with the cost later. Do you want the hard truth? If you can't afford to save up enough money to pay for a vacation before you go, you have no business spending your future earnings to pay for one today.

Putting a vacation on a credit card means that you'll pay even more for it as interest accrues on the balance you owe. That sandy beach doesn't seem quite as alluring now. Plus, if you couldn't save for it in advance, how will you pay it off when you return?

It's easier to save when you have something enjoyable to look forward to, but returning to a mound of debt is plain depressing. My wife and I would never go on a vacation we didn't pay for in advance. It just feels irresponsible to us.

Juggling Vacation With Previous Debts

But what if you already have debt for something else — should you go on vacation then, or hold off until you’ve paid it all down?

Most people have debt in some form or another. In fact, 80.9 percent of American baby boomers, 79.9 percent of Gen Xers, and 81.5 percent of millennials reported that they were currently in debt, according to a survey by Nitro. Personally speaking, my wife and I currently have mortgage debt, and we’ve had a car loan and student loan debt in the past.

As long as your debts are reasonable and you've saved up for your vacation in advance, I totally think you should take some time to enjoy yourself and relax.

Just keep the cost of your vacation in line with your budget and make sure that you're making progress toward paying off your loans.

Frugal Fun

On a personal note, my wife had more than $80,000 of student loan debt a while back. At the beginning of our debt-payoff journey, we didn't go on any vacations.

However, once we made significant progress, we set a small amount of money aside to go to Disney World (we live in Florida, so it’s much cheaper for us). And similarly, we went on an inexpensive cruise a few months before we paid off her student loans for good.

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However, once we made significant progress, we set a small amount of money aside to go to Disney World (we live in Florida, so it’s much cheaper for us). And similarly, we went on an inexpensive cruise a few months before we paid off her student loans for good.

If you've been saving money to go on vacation, but racking up credit card debt to save money for your trip, you shouldn't be going on vacation.

You aren't really saving money, but are instead going into debt to finance your trip in a creative but expensive way. Same thing goes if you have payday loans or high-interest-rate personal loans. These expensive forms of debt need to be eliminated before you even consider taking a vacation.

Should You Go on Vacation If You’re in Debt? Finding a Happy Medium

I do think you can go on vacation even if you currently have credit card debt from the past. People make financial mistakes in their lives. At some point, they figure out they made a mistake and start working to correct it. If this sounds like you, you may be able to go on vacation depending on your money mindset.

Personally, I think you should be able to go on an inexpensive trip to relax. But expensive vacations like international trips should wait until the credit card debt is gone.

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If you still have credit card debt and want to go on vacation, you should be making significant progress paying off your debt and all of your insanely high-interest rate loans should be paid off, too.

My personal benchmark would be that anything with an interest rate of more than 10 percent needs to be paid off. Additionally, if you're still only making minimum payments and struggling to make ends meet each paycheck, your money has higher priorities to tackle than going on a vacation.

Everyone's personal debt situation is unique. Just be reasonable when planning vacations if you're in debt. Never put a vacation on a credit card. But if you have a large amount of debt to pay off, a quick and inexpensive camping trip to a state park might be just what you need to tackle the rest of your debt head-on.

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