Vacationing and having debt

[DnA2010]

We were having a discussion today at work about vacationing with debt- the general consensus came to that mortgage/car loan/student loan debt is more like standard debt, as oppose to things like lines of credit or credit card...most people seemed to think it was o.k to vacation when you have the more “standard” type debt, but if you had credit card or LOC etc, then it wasn’t o.k…this got me thinking-
DH and I really want to take a Disneyland trip as it has been a while, we don’t have any cc or LOC balances, but we do still have a chunk of money on our car loan (oh and a big ol’ mortgage) so really the extra money in our account should be directed towards that car loan, rather than DL…

We are discussing a “budget” trip ie try and keep it around 2K and then putting money on the car loan, and I have been keeping track of “extra” money from selling stuff on local classifieds, money from the gov’t for the teacher strike here, and other things, and that totals around 1K, so really it would be another thousand or so…getting off topic…

I remembered seeing this budget area here on Dis, but haven’t really poked around much, so my apologies if this is discussed a lot, but thoughts on vacationing with debt? We are very tempted as missing the DL!

 

[eliza61]

So I've become a lot more philosophical about debt and money since losing my husband. So I'm probably a lot more skewed.

I no longer put off vacations in order to pay off my mortgage or car note early. Now I did not grow up on credit cards so that was never really an issue.

BUT, let me add that a vacation does not have to be Disney. I can and have done cheaper vacations and have had just as "magical" times.

So my standard answer is, if I had most of my financial life in order (emergency fund, saving for retirement etc) I would not delay my vacation just to pay off my mortgage early.

 

[TravelandLeisure]

In my opinion there's a difference between having some debt that you are in the process of paying off responsibly versus being completely swamped with debt and unable to make timely payments, etc. When your debt obligations lead to you no longer being able to live a comfortable lifestyle and/or you are struggling to pay them while making ends meat, then yeah I think it is irresponsible to spend more money and take on more debt just to vacation.

HOWEVER...if a family has some debt and they are actively paying it off w/o any problems at reasonable interest rates, I see no problem with taking vacations provided that you are not going into further debt to do so. For example, DH and I have a mortgage, car loan, student loan, and a balance on one credit card. But we are able to comfortably make our payments each month and still have enough left over for day to day living expenses and put a little away for vacations. Now ideally, would it be better if we took the vacation money and paid extra toward our cc? Well technically yes, but vacations are important for us--they are our time to unwind and enjoy each other as a family. I try to strike a good balance between being responsible AND enjoying life because ultimately life is short.

Just my two cents

 

[marmalade]

We were having a discussion today at work about vacationing with debt- the general consensus came to that mortgage/car loan/student loan debt is more like standard debt, as oppose to things like lines of credit or credit card...most people seemed to think it was o.k to vacation when you have the more “standard” type debt, but if you had credit card or LOC etc, then it wasn’t o.k…this got me thinking-
DH and I really want to take a Disneyland trip as it has been a while, we don’t have any cc or LOC balances, but we do still have a chunk of money on our car loan (oh and a big ol’ mortgage) so really the extra money in our account should be directed towards that car loan, rather than DL…

We are discussing a “budget” trip ie try and keep it around 2K and then putting money on the car loan, and I have been keeping track of “extra” money from selling stuff on local classifieds, money from the gov’t for the teacher strike here, and other things, and that totals around 1K, so really it would be another thousand or so…getting off topic…

I remembered seeing this budget area here on Dis, but haven’t really poked around much, so my apologies if this is discussed a lot, but thoughts on vacationing with debt? We are very tempted as missing the DL!

Most people would never go on vacation if they waited until their mortgages and cars were paid off. I have a mortgage and student loans and have never hesitated to take a vacation.

 

[mslhb]

Totally my opinion but I think it is silly to think you cannot go on vacation while making payments on a house, car and/or student loans. To me as long as the vacation you are taking isn't going to add to your debt then I don't see a problem with it. Traveling is a priority for us. I could care less about jewelry or fancy cars but family trips is something we prioritize. We are very lucky to have no credit card debt but even if we did we wouldn't stop traveling all together. There are many very budget friendly options.

 

[Mommyof2Boos]

It is our personal thought that if you are making more than minimum payments on any lines of credit you may have then it is okay to treat yourself once in a great while. Also, if you get an unexpected amount of money, legally, that you do not need to pay off debts that it is suitable to use that for fun stuff like vacations.

We do not have outrageous amounts of debt other than mortgages and a small car payment, so the money we were using on the truck that just got paid off is going to cover our vacation.

 

[tasha99]

I believe it's okay to have debt and vacation, so long as you are able to make your payments. The problem with waiting is that life could pass you by. The problem with overspending is that you may struggle in retirement (or be unable to retire). I think somewhere in the middle--balancing your future with your current life, makes more sense than saving it all for later. I've seen too many people do that, only to die before they got to have their dream.

 

[Gumbo4x4]

I'd lose exactly 0 minutes of sleep thinking about it if I were you. When do you leave?

 

[ilovemk76]

We were having a discussion today at work about vacationing with debt- the general consensus came to that mortgage/car loan/student loan debt is more like standard debt, as oppose to things like lines of credit or credit card...most people seemed to think it was o.k to vacation when you have the more “standard” type debt, but if you had credit card or LOC etc, then it wasn’t o.k…this got me thinking-
DH and I really want to take a Disneyland trip as it has been a while, we don’t have any cc or LOC balances, but we do still have a chunk of money on our car loan (oh and a big ol’ mortgage) so really the extra money in our account should be directed towards that car loan, rather than DL…

We are discussing a “budget” trip ie try and keep it around 2K and then putting money on the car loan, and I have been keeping track of “extra” money from selling stuff on local classifieds, money from the gov’t for the teacher strike here, and other things, and that totals around 1K, so really it would be another thousand or so…getting off topic…

I remembered seeing this budget area here on Dis, but haven’t really poked around much, so my apologies if this is discussed a lot, but thoughts on vacationing with debt? We are very tempted as missing the DL!

This is my take.

A mortgage, car loan and student loans, as long as they are not so large you have nothing left over after paying them, are not a reason to not vacation. A vacation does not need to be a large cost item. It could be a camping trip or a trip to a relatives house.

If you have CC debt, I would skip the vacation, since you are charging luxuries and/or basic needs.

LOC is like a mortgage, if it was used for a house need, like a new roof. If it was used to pay off CCs them it needs to be paid off.

The important thing is that all budget categories be within bounds to keep you on track.

 

[karen4546]

IMO I think if you feel comfortable with YOUR financial situation the by all means go on vacation and enjoy yourself.

I personally have a mortgage that I owe roughly $20000. Now I could pay it off with savings but why? It's not hurting my credit by paying the notes and we only have a couple of years on it.

We continue to add to savings and go on vacation to WDW when we could just add the vacation money to savings, but we have come to realize you can't take the money with you and YOLO so enjoy yourself.

I'm definitely not saying go into CC debt. I just say if you can afford to go then GO!

This is my opinion stemming from my circumstances.

 

[crazelion]

I would find another way to fund my vacation. I used reward programs to pay for my vacation. At this moment I have 2015 Orlando/WDW gas and food pay for with gas gift cards and restaurant gift cards. So all have room , tickets and extra stuff kids may want in the parks.

My goal 2015 is pay off my car.

 

[disykat]

Another vote for having no problem vacationing with mortgage, car, or other long term low interest loans with payments that fit well within my budget.

I personally would not be comfortable taking an expensive vacation with debt that was accumulated due to living beyond my means. IME, most credit card debt falls in that category. I would stick to camping for a while, pay off the credit cards, start saving, and then plan a trip that I could do within my budget.

We paid off our mortage early as one part of our plan to help the kids with college, but didn't forgo all vacations to do so. We did, however, regularly talk about our priorities and plan accordingly. Some years a "bigger" vacation was a priority, but we just made sure it wasn't always the priority. (We always vacationed, we just did it inexpensively some years.)

 

[worm761]

You don't have any CC debt and you can comfortably pay your bills. Why wouldn't you go on vacation?

Think of it this way, how would you feel if you suddenly lost DH? I want those memories.

We can pay our bills and still have money left to save therefore we vacation and do other fun things. I refuse to go into debt to go on vacation. As long as I can pay cash for it, it happens. I am currently working Swagbucks and MTurk to pay for the dining portion of our upcoming trip in October. I work them to pay for vacations.

 

[ronandannette]

So I've become a lot more philosophical about debt and money since losing my husband. So I'm probably a lot more skewed.

I no longer put off vacations in order to pay off my mortgage or car note early. Now I did not grow up on credit cards so that was never really an issue.

BUT, let me add that a vacation does not have to be Disney. I can and have done cheaper vacations and have had just as "magical" times.

So my standard answer is, if I had most of my financial life in order (emergency fund, saving for retirement etc) I would not delay my vacation just to pay off my mortgage early.

Shocking news! We take an annual vacation (lots of planning and delicious anticipation) every year without fail. Paying for it is part of our standard budgeted expenses. We will go ahead and book it on a credit card if we see arrangements we like and don't happen to have the cash in hand. We then use our "monthly vacation budget" to pay it off before the next one.

We lost everything (except each other) in a business failure 8 years ago and we will never regain the financial stability we once had. But we have extremely secure jobs, now own a home with rapidly growing equity, a small savings account, a small but growing RRSP, are helping out our DS with university on a pay-as-you-go basis and regularly give to charity. Nobody knows what the future holds; all of our careful planning led us to a very unexpected place. But we are at peace and prioritize enjoying our modest lifestyle to the fullest.

 

[Marionnette]

We don't have a mortgage or car payments. The kids graduated (or will graduate) college without student loans. No CC debts. But I also understand that people often have to carry those debts in order to better their lives (a better neighborhood to raise their kids, reliable transportation for work, an education to make them more attractive to an employer).

I can understand people going on trips while having those debts, but incurring debt for a vacation is just an absolute NEVER in my book. I don't understand the mindset that says "I can put it on a CC and pay $X monthly." If you can afford to pay $X monthly on a CC, then you can avoid paying interest and save $X every month until you have enough to pay for the vacation in full.

And taking a trip when you have no idea how you will pay for it is just irresponsible.

OP, it sounds like you have a reasonable plan for paying down your existing debts and will not be adding to your debt by saving for a modest vacation. I don't think there's anything wrong with your idea.

 

[KKB]

Other than mortgage.

That being said...travel is our love, our hobby, where all our discretionary funds go. We really don't buy new anything unless something breaks. Was just realizing I had our bedroom set before we got married--and we just celebrated our 20th this year. (it is the same set as Ray Romano's except a king, lol--saw a commercial for it last night, that's what got me thinking about it) We are into making memories. Our children are 14-16-19 and it is getting more & more difficult to find common time to take family trips. And I know it won't get easier--so I'm not giving this up.

My only regrets in life were trips I didn't take--one in particular was the family went to Martha's Vineyard and for various reasons we talked ourselves out of it. Never have made it there...

I DO NOT believe in digging into debt to pay for vacations. BUT our first Disney trip my mom paid for as $ was a lot tighter for us then--and we paid her back in installments for the next 18 months, I think. WORTH IT.

Making a decision to take a trip, creating a budget & how to pay for it (even if it involves a bit of debt for a bit) isn't necessarily a bad thing.

I HATE debt--but occasionally it is necessary. I strive for no interest financing, but have sometimes had to stomach some interest--I remind myself it is the "cost of doing business."

 

[ronandannette]

We don't have a mortgage or car payments. The kids graduated (or will graduate) college without student loans. No CC debts. But I also understand that people often have to carry those debts in order to better their lives (a better neighborhood to raise their kids, reliable transportation for work, an education to make them more attractive to an employer).

I can understand people going on trips while having those debts, but incurring debt for a vacation is just an absolute NEVER in my book. I don't understand the mindset that says "I can put it on a CC and pay $X monthly." If you can afford to pay $X monthly on a CC, then you can avoid paying interest and save $X every month until you have enough to pay for the vacation in full.

And taking a trip when you have no idea how you will pay for it is just irresponsible.

OP, it sounds like you have a reasonable plan for paying down your existing debts and will not be adding to your debt by saving for a modest vacation. I don't think there's anything wrong with your idea.

I really like the disclaimer in fine print in your signature. It's probably the best advice the OP will get in this entire thread. Happy New Year!

 

[ajwolfe]

My personal thought is if you are living within your means and are able to make your payments (mortgage, car, whatever) without fail I see no harm in taking a vacation. Life is short, you never know what can happen; so personally we would rather have the memories instead of worrying about paying off our car loans first.

Enjoy your trip!!

 

[DnA2010]

Thank you all for your thoughts and comments.
Indeed we will not be adding any debt with a vacation and do have a healthy savings (our Honda CRV has over 600,000km on it so we know we need to replace with a truck as we have horses and a horse trailer and want to be able to pay cash for a nice used truck in the new year)

Just found out after I posted this that I am more than likely going in for a 2nd ankle surgery in February, which will be a long recovery, so now pondering throwing together a quick budget trip...was thinking of spring break, but now would have to be that parent that pulls their kid out of school for a trip!

 

[DawnM]

I would agree with you. My perimeters would be:

Living well within your means with some savings
No CC debt
No debt taken on by a vacation