NEW HAVEN, Conn. (CNN)– Many of you are taking off for vacation and hoping you don’t overspend on that travel budget! According to a new survey, most people go into debt to pay for their vacation. We are stretching your dollar with a look at where that money goes
You’ve likely used the excuse, “hey we’re on vacation,” as you swipe the credit card for meals and excursions. You can still have fun on vacation, but you’ll save yourself the headache and debt with a little advanced planning.
As you vacation in the sun, your savings may melt away. A survey by Lernvest, a financial planning firm, shows 74 percent of people go into debt to pay for a vacation.
On average the cost is about $1,100. Problem is, more than half of those people say they don’t budget for their time away. Which is a problem, especially since a week-long vacation costs most people more than their monthly rent or mortgage. In fact, the survey shows on average people spend 10 percent of their annual income on vacations.
To stretch your dollar without sacrificing your time off the survey recommends that you start budgeting now. Skip the coffee line and put the money in savings. Plan your vacation down to the last dollar. That way there are no surprises.
Also, don’t be dazzled by the deals. You may see a great sale on flights but don’t spend money you don’t have and try not to put too much on a credit card. If you don’t pay off your monthly balance, interest rates can push you deeper into debt.
If your plan is to use a credit card, maybe look into one that gives you points or rewards when you use it in restaurants or on transportation. At least you’ll know you’re getting something back you can maybe put toward the next getaway.