Find Out if you Should Get a Holiday Loan or a Credit Card

When we think about a holiday, most of us think about walking tours around Rome, laying by a beach or sipping a cocktail at a resort bar. Organising the funds to go on a holiday can feel like a storm cloud over the sunny escape you’ve dreamed of but saving money is not always as easy as it sounds. 

If you’re thinking about taking a holiday, it’s important to establish if you have time to save or if you are going to have to look at a quicker way to head start your holiday relaxing. Credit cards and personal loans are both effective ways to pay for a holiday, short or long. 

Depending on the amount, a loan for a holiday will fall into the personal loan category and may be secured or unsecured. Holidays can be expensive, and it can be daunting to think about how much you need to achieve your dreams, but it is important to establish a budget or an amount of how much you are going to spend.

Make a list of all the things you will need for the holiday; this can include flights, food, accommodation, will you need to buy warmer/cooler clothes, what activities you want to do etc. Once you have established this, it’s time to consider which type of finance will be best for you.

The Benefits of Holiday Loans

A personal loan has the benefits of having a fixed interest rate and of getting all the money at the one time, this means you have all the money to start with and you can spread it around accordingly.

Having the money right away also means you have a better chance of getting early deals or flights when they become available.

Holiday loans will allow you to have the money at the beginning and the fees and charges are all disclosed in the contract and remain unchanging.

The Drawbacks of Vacation Loans

The downside to getting a personal loan for a holiday is that depending on the amount being borrowed, the payments may be high and adding them into a weekly budget where you may also be trying to save extra for the holiday could add stress.

Lenders must also stay within guidelines for loan terms, so you may end up paying off the loan before you even step into the airport.

What about using a Credit Card to Pay for a Holiday?

Now you might be thinking, I can do all these things with a credit card, however the downside to using a credit card for holiday expenses is that they can have very high, changing interest rates. You have to be switched on and aware of how much you are spending while on vacation to make sure you don’t go over your limit and once you get back from your trip, that’s when you have to start paying it off.  

What’s the Verdict? Should you Get a Holiday Loan or a Credit Card?

Both options give you the ability to pay as you go, or buy what you need up front, but the main differences are that you can start paying off a personal loan as soon as you get it lessening the debt you return from your trip with, while a credit card bill gets paid after you have come back from your trip and can create another problem all together if you have issues paying it off. 

With whatever option you go for, it’s important to assess whether it will be the best option for you.  Both offer the freedom to go on the holiday you’ve always wanted but everyone prefers something different and it’s important to pick what is best for you and go to a financial institution that you trust.

If you'd like to enquire about vacation loans, or wish to ask about how our loan application process works, please contact Champion Loans. Alternatively, visit our dedicated Holiday Loans page to learn why you should get a holiday loan from Champion Loans.