Whether you’re a snowbird escaping the cold for warmer pastures, someone who always uses their annual vacation time right away or you just regularly travel this time of year as a pick-me-up following Christmas and New Year’s, getting away at any time – let alone during the winter – is always something to look forward to. That said, nothing can quite dampen your travel experiences like coming home with bad credit or no money.
So how can you travel and not go broke? Here’s a look:
Plan properly: The first step to traveling in a fiscally responsible manner is budgeting appropriately. Do your research on flights, lodging, meals, entertainment, etc. to come up with an accurate ballpark number of what you’ll need, then save until you meet this magic number so you’re not just charging everything and paying it off later.
Look for ways to save: If you won’t be able to hit your target budget or if you want to reduce your target budget, consider cashing in airline miles to help with flight costs or hotel rewards points for lodging. You may even be able to turn any earned credit card rewards points into something related to your trip. Some memberships, like AAA, can even get you discounts at certain places. If you don’t have a rewards account set up with certain vendors, start now. You can bank the points for future trips.
Consider cash: If you’ve saved enough to meet your projected budget, consider pulling the money in cash and paying for some of – if not all – of your expenses that way. This is beneficial for a few reasons. One, you likely won’t spend more than what you budgeted for. And two, paying in cash also helps prevent credit card fraud. Domestic and tourist hotspots abroad alike tend to be areas where identity theft is common.
Know the customs: This is especially true if you’re traveling abroad, as the country and city that you’re venturing to may have different customs on tipping. While it’s common in the U.S. to tip drivers and most service industry workers, this isn’t always the case abroad. You might think that a tip here or there wouldn’t add up, but if you spend $100 on dinner every night of a 10-day trip and think that 20 percent gratuity is the norm somewhere where it’s not, you’re throwing away a few hundred dollars that you don’t need to spend.
Look for low price alternatives: Conventional lodging and transportation methods might not be the best for your budget. That said, look into Airbnb for lodging to see if you can get a cheaper rate, take an Uber or Lyft instead of a taxi cabs, or consider public transportation for getting around town. The savings can significantly add up.
How to Survive a Financial Hardship and Not Ruin Your Credit
While we all hope we’ll never be in a situation where it’s difficult to pay the bills, things happen. You might be furloughed due to circumstances beyond your control, like the hundreds of thousands of people out of work right now with the partial government shutdown. Or perhaps you or your spouse were laid off, let go or forced to take a sizable pay cut. Maybe an unforeseen expense is making things difficult. Even if your financial hardship is temporary, that doesn’t mean it’s easy. Things can become especially dicey if you rely on your credit card to make ends meet on your bills, a strategy that can greatly raise your debt and lower your credit score.
The good news is there are certain tips and tactics you can follow if you’ve fallen on tough times to help you navigate your way through things without killing your credit score. Here’s a look at how to do it:
How to Keep Your Credit Score in Tough Times
Look into hardship plans with your credit card company: The credit card companies typically don’t publicize this benefit, so there’s a good chance that it’ll be up to you to initiate it. However, many companies do offer hardship plans to help people better manage their debt. Essentially, hardship plans are repayment plans specifically catered toward a particular consumer’s financial situation – and enrolling in such a plan has no direct impact on your credit. Be honest with your creditor about why you need to enroll in such a plan.
Stick to the necessities: You likely need to stay up on your car payments, mortgage payments, utilities and perhaps your phone bill. But your cable bill? Your Netflix, Hulu, Amazon Video and other streaming services? Eating out? Your daily morning Starbucks? Those are all things you can likely live without. Don’t be afraid to cancel or put a hold on these luxuries until you can get back on your feet. You’ll thank yourself in the long run.
Pick up a part-time job: If you’re out of work and your unemployment benefits aren’t cutting it, don’t be too prideful to get a part-time job to help you get through the tough times. Even just bringing in a few hundred dollars more per week can help you knock out some of the essential bills you’re on the hook for. Plus, you can always leave the part-time gig as soon as you secure full-time work in your desired field once again.
Minimally, always make on-time payments: Even if you can only pay the minimum payment on your credit card, make sure you do it. Credit scores are largely weighed on whether or not you make on-time payments. Skipping even once can cause your score to dip – and you don’t want to get docked for something so seemingly simple to avoid.
Most of all, if you’ve fallen on hard financial times – don’t panic. Come up with a strategy of how you’re going to address your situation, then act. It’s possible to do without sacrificing your credit score.