Don’t Get Burnt (By Holiday Finances)
By: JamesQuinton | Posted: 05th July 2007
To pay for their summer holiday, twelve million Britons will slip into debt, with more than the a quarter using credit to pay for their break. For some they would rather get into debt than not have a holiday at all and will take out a loan, use their overdraft or credit card to finance their break, only thinking about the cost of their holiday when they return.
A mindset of “me now, debt later” is prevalent with holidaymakers and is a key factor of debt in the UK; holidaymakers should ensure that a little over-indulgence doesn’t snowball into major financial problems.
It would be wise before going on holiday to come up with a budget, something which over a third of holidaymakers apparently doesn’t do; eating out and sightseeing excursions are the main cause of over-spending, with men more likely to be negligent with their financial plans. Those who do over-spend are warned not to miss credit repayments that could affect their credit report and deter lenders from offering credit in the future.
Small savings can make all the difference, simply changing currency before you travel will avoid hefty commission charges overseas. Traveller’s cheques should be brought and only used in an emergency – these can be spent in the last couple of days of the holiday. Debit and credit card are convenient for spending abroad as you will get a better exchange rate than at foreign bureau de changes.
Holidaymakers are being advised to keep track of their spending day by day and are also being advised to keep credit card spending to a minimum; the average Briton will run up a credit card bill of £799, a figure that could be even higher this year. But if you have to use a credit card you can almost certainly get a good deal as there are plenty of zero percent deals on balance transfers and purchases.
James Quinton is a writer based in the UK. He has had articles published worldwide. Compare card rates online.
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Tags: mindset, repayments, going on holiday, overdraft, balance transfers, articlealley, summer holiday, snowball, indulgence, cheques, britons, briton, hefty commission, debit and credit