Should You Travel When You Have Credit Card Debt? | Financial Gym (2024)

Travel has so many benefits—you get to have new experiences that expand your horizons, create lifelong memories, and take a break from the stressors of your day-to-day life. But traveling when you have debt can feel…complicated—you want to get away and enjoy life but returning home to an even bigger credit card balance might leave you even more stressed than before. The good news is that you don’t need to put your life on hold when you have debt. With planning, you can have your travel cake and eat it too.

Should you travel when you have credit card debt?

Pros of Traveling When You Have Debt

It requires you to exercise your financial planning muscles: To take a trip without adding to your debt, you will need to examine your spending, plan ahead, and save in advance. These are great skills that will help you in your financial journey overall, including paying off debt.

It can renew your motivation to work toward your goals: Depriving yourself while paying off debt can backfire. Reminding yourself what you are working for (like being able to take great trips), may actually increase your motivation to pay off debt so that you can have that life you want even sooner.

Cons of Traveling When You Have Debt

It will take you longer to pay off your debt: Even if you aren’t adding to your debt by traveling, you are making a tradeoff. If you put the money you saved for a trip toward your debt instead, you’ll pay it off faster—that’s just the math of it.

Unforeseen expenses could add to your debt: Even when you plan well, unexpected expenses can still happen. Your travel partner might flake leaving you to shoulder higher costs, you might miss a flight, or your Airbnb host might cancel last minute. If you don’t have the cash to cover these expenses, they’ll end up on your credit card.

How to Travel Without Adding to Your Debt

Assess your current spending

Financially prepping for travel starts with figuring out how much you can set aside for it monthly. If you are currently saving money for something else or paying above the minimums on your debt, can you reallocate those funds toward savings for travel until your trip? Are there other expenses you could pause for the time being? Add up how much you could save each month based on these changes.

Plan your trip around how much you can save

Once you know how much you can save per month, it’s time to plan for the trip itself. If your dates and destination are fixed (i.e. you are traveling for a certain event or already have the outline of a trip in mind), add up how much you’ll have saved in total before the planned dates. That’s the amount you have to work with. If you are in the earlier stages of planning for a trip, you can choose the budget amount first, and decide when to plan the trip based on how long it will take you to save up for it.

Add a cushion for unexpected expenses

When it comes to travel, expect the unexpected. This means that when you’re planning your budget, you should reserve 15%-25% for unforeseen (or forgotten costs). This will help keep you within budget and decrease the likelihood that you’ll overrun your estimates and need to put expenses on your credit card.

Stick to paying with cash

Leave your willpower out of it by paying for your travel expenses with cash or debit. Don’t get caught up in chasing rewards points if there is a chance you won’t pay off those charges in full. If you need to use a credit card for something like a car rental, pay off the specific amount with your travel savings ASAP.

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Should You Travel When You Have Credit Card Debt? | Financial Gym (2024)


Should I go on vacation if I have credit card debt? ›

If you are not able to make your payments — and like not even the minimum payments — and you're running in the negative every month, then you probably shouldn't be traveling,” says Grant. “Or if you do, something that's super low cost.” Also consider if it's possible to cut back in certain areas to accelerate savings.

Should I travel if I'm in debt? ›

It will take you longer to pay off your debt: Even if you aren't adding to your debt by traveling, you are making a tradeoff. If you put the money you saved for a trip toward your debt instead, you'll pay it off faster—that's just the math of it.

How to travel while paying off debt? ›

How to travel while managing debt
  1. Pay for the trip without taking on more debt.
  2. Continue to make existing credit card and loan payments.
  3. Find deals on travel, hotels and food.

Is it OK to go into credit card debt? ›

Try to prevent a situation where your monthly credit card debt payments are greater than 10% of your average monthly income.

Can you spend money while in debt? ›

Financial experts agree that while it's crucial to cut back on spending when trying to pay down debt, treating yourself with things here and there keeps you motivated to continue your journey until you reach the big end goal.

Is credit card debt considered bad debt? ›

Debt could also be considered "bad" when it negatively impacts credit scores -- when you carry a lot of debt or when you're using much of the credit available to you (a high debt to credit ratio). Credit cards, particularly cards with a high interest rate, are a typical example.

Can debt stop you from Travelling? ›

“Can debt stop me from leaving the country?” No, you can still leave. However, be careful which country you go to, because depending on where you go and what kind of agreements the two countries have… They (the debtors) may still be able to chase after you for their money.

Can debt collectors stop you from Travelling? ›

A judgment can allow a creditor to file a lien against your property or garnish your accounts, for example. While they can't keep you from leaving the state or country, the creditors can keep you from taking some of your assets with you.

Should I go broke paying off debt? ›

If you have debt such as payday loans or high-interest credit cards, paying these off first will save you money and help you refocus on other financial goals. But if you don't yet have an emergency fund, prioritize saving a little bit either before or alongside debt payoff.

What not to do when paying off debt? ›

5 Big Mistakes to Avoid When Paying Off Debt
  1. Not having a payoff plan. Knowing you want to pay down debt often isn't enough to be successful at such a challenging endeavor. ...
  2. Spreading around your money too much. ...
  3. Not tracking your progress. ...
  4. Working on debt payoff with no emergency fund. ...
  5. Continuing to get deeper into debt.
Sep 21, 2021

What happens if I walk away from debt? ›

Sadly, the damage you feel by walking away from debt isn't felt immediately. Over time, your creditors will file delinquent notices with the credit bureaus. This happens on their watch, unfortunately. They can also take different actions that can make the situation even worse.

What's the fastest way to pay off debt? ›

Here are five of the fastest ways to achieve debt freedom:
  1. Take advantage of debt relief services. ...
  2. Reduce interest where possible. ...
  3. Focus on your highest interest rate first. ...
  4. Take advantage of opportunities to earn extra income. ...
  5. Cut expenses where possible.
Mar 11, 2024

Is $5000 in credit card debt a lot? ›

$5,000 in credit card debt can be quite costly in the long run. That's especially the case if you only make minimum payments each month. However, you don't have to accept decades of credit card debt.

How much debt should a 40 year old have? ›

Average debt by age
GenerationAverage total debt (2023)Average total debt (2022)
Millenial (27-42)$125,047$115,784
Gen X (43-57)$157,556$154,658
Baby Boomer (58-77)$94,880$96,087
Silent Generation (78+)$38,600$39,345
1 more row
Mar 28, 2024

How long will it take to pay off $1000 in credit card debt? ›

It will take 24 months to pay off $1,000 with payments of $50 per month, assuming the average credit card APR of around 18%. The time it takes to repay a balance depends on how often you make payments, how big your payments are and what the interest rate charged by the lender is.

Should I let my credit card company know I'm going on vacation? ›

You're not required to notify your credit card company when you're going away on vacation, but it is highly recommended.

Can you leave the country with credit card debt? ›

Simply because you've left the country doesn't make the contract between you and your credit card issuer void. Your debts don't disappear and you still have an obligation to repay them. However, if your move abroad is genuine, just make sure to be communicative with your credit card issuer and/or debt collectors.

Is credit card debt a deal breaker? ›

“When you think about the implications that are associated with credit card debt, like high interest rates, irresponsible spending, financial mismanagement, and a lack of self-control, it's easy to understand why this may be considered a deal breaker,” she said.

Is it worth paying off credit card debt? ›

By paying your debt shortly after it's charged, you can help prevent your credit utilization rate from rising above the preferred 30% mark and improve your chances of increasing your credit scores.


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