Taking Out A Personal Loan To Travel – Yay or Nay

Posted on Jan 22 2019 - 12:45am by Leila Dorari

One of the best ways to expand your horizons and gain new experiences and try foreign food and then bore everyone home AND your momma on how tasty it is even though it’s pointless because they can’t really try it is to set sails and go on a journey to a new destination!

Australia, for example! A country of exotic (if at times incredibly aggressive and poisonous) animals, picturesque coral reefs, and the Sydney opera house!

… Omg, there’s this cake, it’s called Lamington, and it’s the finest buttery thing, and there’s like chocolate and it looks good… they call them Lammoes over there …. Hahaha! No, but seriously, it has this curious buttery thing to it…

Yeah, yeah, alright! No one cares that you stuffed your face senseless in a foreign country!

How about learning the local language or visiting some monuments or something. Basically, unless you’re a professional cook and are talking to other cooks, no one cares.

Anyway, lest we continue to rant about the horrors of food-related travel stories, let’s swing back to the topic of this article which is personal travel loans.

Let’s face it, traveling costs money, and let’s just say that the urge to hit the road often catches one when they’re not in their best financial state. Other than making a loan with a friend, the only viable solution to make it happen would be to take out a personal bank loan.

Now, in this article, we’re going to talk about whether or not that makes sense and how to approach this issue in a sensible way.

Alright then, here’s the deal, globetrotting’ folk!

Is Taking a Loan for Travelling Worth It?

Ehh, sort of. It can be worth it, but you have to weigh out your possibilities carefully.

For example, if you have a stable salary and plenty of room for holidays as a part of your job position, you can pull off a loan-based holiday and then don’t even feel the subsequent payments.

On the other hand, taking out a loan with a tough interest rate with an unstable job can end up draining your finances incredibly quickly and even cause you to go bankrupt in the worst case scenario!

The thing is, of course, that investing is traveling is really not investing at all. In fact, it’s the opposite of investing – if you look at it from the business side of the argument, it’s equitable to throwing your money out of the window.

On the other hand, it’d be fair to say that traveling is a sort of soul food, so it arguably has no cost.

On the Matter of Personal Loans

There are two major types of personal loans: secured personal loans, and unsecured personal loans.

The difference is pretty straightforward, really. In order to obtain a secured personal loan, you’ll need to have some sort of asset to put up as a token of security for the loan. This can be real estate or some other form of property that can be exchanged for value if you fail to pay up your monthly rate.

An unsecured personal loan, on the other hand, does not require any sort of mortgage or property to be put up as security, but what it does mean is that you’ll be expected to agree to a higher interest rate on the regular monthly payments.

So, what option you’d like to go for really depends on your personal financial situation. If you don’t have a piece of property you’d be ready to put up for mortgage, for example, but otherwise have a stable salary, an unsecured loan may be a way to go for you.

How to Make the Most of Your Travel Loan?

If you’ve already made a decision to go for a travel loan, you might as well make the most of it. To do that, you’ll need to do some preparatory work first, of course, as saving money mostly amounts to figuring out what you don’t need to spend it on.

  • Set a Finite Budget – Understanding that you can’t really spend money to your heart’s content while abroad is bound to make you use your brain instead of focusing on out-of-control shopping sprees. To do this, set a budget in advance and stick to it while on your travels.
  • Make Good Use of Special Deals and Rewards – Many banks offer special deals to people who want to take a travel loan, so pay attention to your bank’s policy when this matter is in question. If you play your cards right, you can dramatically reduce the amount of credit you spend while on your holiday.

All things considered, the fact that you want to relax on your travels doesn’t mean you should disregard your finances completely. If a loan is a way to go for you, take heed from tough interest rates and make sure to agree to a viable deal that will work for you in the long run!

Leila Dorari
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About the Author

Leila Dorari is an entrepreneur and freelance writer from Sydney. She is passionate about exploring different places across the globe and believes that first you need to get lost before you can get found. In her free time you can usually find her hiking with her furry four-legged friend.