Taking a vacation can be a great way to reduce stress and experience different cultures, but it’s never cheap to travel. At the very least, you can expect to need several thousand dollars and, if you have a big family, the cost can rise significantly. If you want to take that vacation sooner, the option of using your credit card to finance the trip and paying off that balance later is tempting. However, there are some points to consider first.
Will I Be Charged a Transaction Fee?
This is something you should ask each card issuer since the answer will vary from company to company. Those that do charge a transaction fee for foreign purchases usually charge a 3% rate. This means using your card to pay a $1,000 hotel stay in Europe or Asia will end up costing you $1,030. While a service, such as Tuck Associates, can help you reduce your credit card debt later, you will still want to keep an eye on this type of hidden spending.
Does My Card Have the Chip?
In the U.S., people have gotten used to the idea of using credit cards that have the EMV chip. Some stores require you to slide the chip into a special reader, while other points of sale don’t read the chip and allow you to simply swipe your card. However, many merchants outside of the country do have chip readers. It will be important to ensure your card has the chip, especially if that card is to be your only means of payment abroad.
What Can I Do if My Credit Card is Stolen?
It’s a good idea to take a photo of the front and back of your credit card with your phone in case the card is stolen. This will give you the information you’ll need to report the theft. Additionally, you should consider bringing along an alternative payment method. If you’d rather not bring cash, discuss your plans with Tuck Associates and decide if bringing along a second card is the best option.
Does My Card Offer Rewards?
If you’re going to be charging a large portion of your vacation, you may as well get rewards for your spending. If you don’t currently have a rewards-based card, it may be worthwhile to apply for one in time for your vacation. This will help you stack up the points that you may be able to use for another vacation.
Can I Repay What I Spend?
This may be your biggest consideration because you don’t want a brief vacation to end up causing you prolonged financial stress. The best approach is to estimate what your family will spend on vacation and work out a repayment plan ahead of time. Don’t forget to add in the interest that will be added to the final amount. The payments you work into your budget should be enough to repay the entire debt within a year. If that seems unlikely, you may want to consider reducing how much of your vacation will be financed with your credit cards.
While paying for your vacation with your credit cards may seem like the easiest way to finance your trip, it shouldn’t be done without careful preparation. Taking advantage of rewards programs, looking for hotel and airfare deals, and planning for repaying what you borrow will help you enjoy your vacation a little more. The right amount of preparation will add to your vacation enjoyment and not take away from it