Many of us like to go on holiday and therefore tend to go regularly. Some people go several times a year and some every few years. This will depend on how much time we have and how much we enjoy going on holiday plus what we can afford. Whatever we decide to do, we will need to figure out how we are going to pay for it and think about how much we can afford.

How to pay

There are different options available to use here. You could borrow the money, save up or use money that you already have saved. This will depend on what money you have already as well as whether you feel that you can wait to save up or that you can save up at all. There are pros and cons of all methods and it is worth exploring these.

If you borrow money then you can get it quickly and will not have to wait for your holiday. However, you will need to repay the money and you need to make sure that you will be able to afford to do this. When you borrow money it is always a wise idea to make sure that you are aware of how much the repayments will be and how often. Then you can calculate whether this is something that you will be able to afford. You will need to look at your current financial situation and how much you earn and pay out to work out whether you would have enough left for a loan repayment.

If you save up then you will have to wait. If you can only save a little money each month you may find that it will take you a long time to save up the money that you need. This can be hard if you want a holiday right away. However, it will mean that the holiday will be cheaper as you will not need to pay the fees and interest that you would with a loan.

If you already have the money in your savings account then this means that you can go on holiday right away and not pay the loan costs. However, you may have been hoping to use that money for something or keep it to fall back on should you have a financial emergency, so the decision may not be that simple.

Paying for your holiday in instalments is great for money management.

How much to pay

It is also worth thinking about much you should pay for your holiday. You can get pretty cheap holidays if you do not travel far, do not stay away for long and camp using your own equipment but you can pay a lot if you go abroad for a long time and stay in an expensive hotel and do lots of expensive activities. You need to think about what sort of thing you want to do as well as what will fit in with your budget and this will help you. You will have an idea of what you will not be able to afford it a vague sense but it can be worth working it out properly. Think about whether you want to borrow, use savings or save up as this will have a big impact as well.

You will also need to think about how soon you want the holiday. If you have your heart set on a specific type of holiday which is really expensive, then you may be prepared to wait a long time for it so that you can eventually save up to go. However, if you feel that you need a holiday right now, then you will be more limited as there will not be time to save up. If you cannot save, then you will either have to use savings you already have or borrow the money and this will restrict you with regards to how much you will be able to pay as there will not be a limitless amount of money available and you need to make sure that you borrow a reasonable amount so that you can afford the repayments.

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