To pay for our holiday in instalments?

[ddddora]

It’s a few hundred pounds a month. Talking to a friend and she said it’s what most people do. AIBU to pay this way? It’s interest free, and we have the funds available each month technically it’s just less to put away in savings. ATOL and ABTA provider, only lose the small deposit if I cancel but can also move the dates if needed for small admin fee.

Can’t pay for it outright as it would deplete nearly all our savings & if I wait to book it, the prices will rocket.

I've done this for the last few years,.and have the payments taken from a credit card. I do know where you're coming from about feeling you should pay it in full, as I felt a bit cautious, as what if circumstances changed and you're then committed? But then as you say, it's cheaper usually to book ahead, and you've got the money in savings anyway.

I booked this years in November, so they'll take payments up to April, then May and Junes salary can go towards spending money.

I can afford to pay off my holiday now but I’m paying it off monthly - really don’t see the issue

We did this last year and it was all ok

I understand where you're coming from.

I still can't bring myself to buy a car on finance/lease even though I know it makes financial sense. I hate driving, and hate spending money on what I consider a necessary evil, so even though it would make sense to lease a nicer car through work on salary sacrifice, I just can't because every month I saw that payment being deducted it would piss me off. It's bad enough having to put petrol in the fucker!

Unless it’s literally every spare penny you have each month, I don’t think it’s unreasonable.

I prefer to save and pay it off in one go when I can afford to go on holiday. It’s fine to not go on holiday because you can’t afford it.

Smart. Credit card cashback!

I always pay in instalments the smaller the better, I just think if something happens and we end up cancelling I’ve not lost all my money. It just makes sense it doesn’t make the holiday any more expensive

I do this. Quite often.

The only time I do it differently is if I just pay the deposit and put the remainder in savings til it’s due - but that was mainly something I did in Covid when everything was uncertain so I didn’t want the holiday company holding my money.

Ooh yes!! That wasn't actually the reason I did it but I WILL get cashback too won't I?

Shame I forgot to also go through a cashback site which I'm kicking myself for!

@ddddora DON'T FORGET TO USE YOUR CASHBACK ACCOUNT!!

We've always done this and that's with both big holidays costing thousands and little holidays costing a few hundred. Seems like a pretty sensible way to book and helps with your credit rating. Even when I can afford it out right, I still pay in installments.

Pay for it outright and put what you would have spent in instalments back into your savings. That’s what we do. I’m baffled by people who pay for holidays in instalments, it’s much more responsible to save up first and pay all in one go.

Why is it more responsible?

I pay for nearly all my holidays in installments. I can afford it outright but I would rather not wipe out most of my bank account or savings in one and find it much more manageable in monthly payments.

I pay EVERYTHING on my CC. Groceries, bus, everything. It's tiny cashback, but....
Overall all these things count together.

I have never understood that logic. If you can afford the repayments you could have saved that money each month first and then bought the couch.
Same principal with holidays, if you can afford to pay off monthly you can afford to save up first. Still important to pay in a credit card though before paying off straight away.

I’ve never considered doing this but it seems that I’m the only person on the planet that doesn’t pay for everything this way. I’m the one that’s missing out it seems.

I'm a bit confused. Any holidays I've booked that are not DIY where I book my own flights, accommodation etc have required a deposit and then full payment 2 or 3 months before travel.

When you say you are paying in installments, do you mean, for example, you book in September with the full amount due in April and then pay a monthly installment each month until April? Surely it would make more sense to put that same amount in to a savings account and then pay the full amount from that account in April? This is the way I do it. No point giving them money before I have to.

Or is it some form of interest free loan where you are paying it back after you rerurn from holidays?

Nothing wrong with instalments at all.

Personally though I prefer to pay the deposit and then save the balance in a separate account until the full balance is needed (typically 8/9 weeks before). If you pay by cc you also get another 4 weeks before you actually have to take the money out of your savings.

@OchonAgusOchonOh I’ve been making payments to our holiday for June (which has to be paid by the end of March) each time I get paid. I just treat it as a bull. Personally I like to sign into my booking, and see the balance owed reduce. I could keep the money in an account and pay it in March, but I don’t want to, that money isn’t mine, and the cost of the holiday would be hanging over me. Maybe that doesn’t make much sense, I think we all have our own logic and behaviour re money and spending

As a bill, not a bull 😆

When you say you are paying in installments, do you mean, for example, you book in September with the full amount due in April and then pay a monthly installment each month until April? Surely it would make more sense to put that same amount in to a savings account and then pay the full amount from that account in April? This is the way I do it. No point giving them money before I have to.

For me, it's not about "giving them money before I have to", it's about reducing the balance over time so I don't suddenly have to pay out hundreds of pounds in one ago. It just feels better to me to do it that way.

You don’t need to be ‘wadded’ to stump up a few grand for a holiday in one go, a fair few people on average incomes operate with a slush fund that’d easily cover it.

Instalments. Even if you have the money. I'd rather have it earning interest. And if the company goes bust before you've paid it off you haven't lost all your money.

So you mean you're not a matador?

@MaryActsLikeSheDontCare I guess we're all different. I would find the need to go in once a month to pay much more stressful and would hate for that to be hanging over me😀