Turbo Takeaways
- Average vacation costs for a family of four traveling in the U.S. could total over $9,000.
- 29% of Americans plan to go into debt to take a vacation.
- Smart financial choices like starting a vacation savings account can help consumers avoid debt.
Why Vacationing Without Debt Matters
Taking a vacation at least once a year is a top priority for many Americans. Whether you get away with friends, bond with your family, or explore solo, vacationing is usually a worthwhile splurge. But it shouldn’t land you in heaps of debt.
Since the average vacation in America costs around $2,300 per person, planning something within your budget is essential to avoid overspending. Trips out of the country can strain your finances even more. Charging everything on a credit card and paying off your vacation later limits your ability to save for emergencies and repay current debts.
Vacation choices that can land you in debt include:
- Planning trips that exceed your income
- Charging vacation expenses all at once on a credit card
- Making credit card purchases and not paying them off in the next billing cycle
- Booking travel at the last minute or without comparing prices
- Costly add-ons for transportation, lodging, or excursions
- Travel to high-cost locations without saving for the trip
- Consistently avoiding cost-cutting measures like seasonal travel or road trips
When travel turns into financial stress because of high-interest credit card balances, vacationing loses much of its fun. But with smart choices and informed travel options, you can make your next vacation rewarding and budget-friendly.
How To Make Your Vacation Affordable and Avoid Debt
A staggering 29% of Americans surveyed by Bankrate say they’ll go into debt to vacation. Avoid being part of this statistic with these financially savvy travel tips:
Start Saving
Save for a vacation all year by setting up a high-yield savings account to earn more for your investment. Many banks offer an annual percentage yield (APY) between three and four percent with an initial investment and additional factors like continuing direct deposits or credit union membership.
Automating your vacation savings meets bank requirements and helps you make consistent payments into your vacation fund so your trip won’t land you in debt. Keeping your travel savings separate from your emergency fund also helps you avoid draining rainy day cash for the sake of a good vacation.
Consider the Time
Avoid debt by timing your vacation right. If you can travel at an off time or out of season for certain bookings, you’ll likely find better rates for everything from transportation to lodging.
This doesn’t necessarily mean you’ll have to take a cruise in February. Certain locations see lower volumes in the summer or at the beginning or end of popular travel dates (shoulder seasons).
For example, the summer months are actually considered a low season for travel in Florida (theme parks and high-volume beaches excluded). Costa Rica’s rainy season, which lasts from May to November, offers guests lush travel among rainforests and beaches with lower prices, reduced crowds, and afternoon showers. Look out for additional low-season finds using online travel guides.
Stay Smart
Where you stay has a big impact on the cost of your trip. Look for cost-saving accommodations such as rentals that are further from busy locations, hotel promos, and travel bundles. If possible, book directly from property owners to avoid additional fees from management companies.
Consider lodging with a kitchen so you can cook and prepare food where you stay. This is especially effective for families who can save money and cater to young eaters. Even eating breakfast in the room with convenient items like yogurt, muffins, and fruit cuts costs and saves time for more sightseeing or lounging by the pool.
Go Without
Choosing to vacation may mean giving up other things. Cut back on non-essential items in your budget, like entertainment or eating out, to save income for a vacation. Try to make the months leading up to your trip leaner so any extra income can go towards travel expenses.
Plan to do a big summer vacation every other year and staycation in the off years to save up. Look for resident discounts to enjoy vacation spots in your area. Camping and visiting state and national parks are also low-cost ways to get out of the house and do something different.
Enjoy Vacationing Without Debt
Starting a vacation fund and budgeting to travel within your means are top ways to avoid debt while still enjoying some needed time away. Other cost-cutting measures include traveling in off-seasons and finding deals on lodging, including cooking for yourself with an in-room kitchen.
Lots of savvy travelers use apps and websites for alerts on flights and booking discounts. Consumers also rely on credit card rewards for airlines and hotel stays. Purchases throughout the year can easily turn into hotel stays and airline miles.
With planning and smart budgeting, you can still take a great vacation without going into debt. Instead of charging everything to pay off later, leverage travel rewards, perks, and seasonal offers to get the most for your money.
Do’s and Don’ts for a Debt-Free Vacation
| Do | Don’t |
|---|---|
| Automate high-yield vacation savings | Charge everything and pay it off later |
| Consider low-traffic locations and off-season travel | Consistently travel to high-volume areas during peak seasons |
| Save on meals with a kitchen or simple in-room breakfasts and snacks | Eat out consistently without budgeting for meals |
| Plan ahead to watch for better prices | Book last-minute (except for flash deals) |
| Choose meaningful and limited gifts | Splurge on souvenirs |
| Use coupons and discounts as much as possible | Pay full price without shopping for travel deals and discounts |
Pay Off Debt to Vacation More with Help from TurboDebt®
Going on vacation instead of paying off high-interest debt isn’t a great idea. But if you’re already dealing with the burden of outstanding unsecured debt, it can seem impossible to even plan a small getaway.
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