Going on holiday whilst in debt - WWYD

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Hi,

DH and I are in the process of paying off a lot of debt. We got into lots of debt through silly spending and wanting to have everything right away. We are doing well with the repayment plan - we have a set budget and for the last 26 months we have managed to pay all of our bills, living costs as well as making significant overpayments to our debts. We are on track to be debt free in 3 years. We have also managed to build a small savings pot - this was important to us as we had no buffer before.

The issue is that our kids are getting older and I feel as though I don't want to miss out of making precious memories with them. I would really like us to go on a cheap foreign holiday next to spain/majorca etc. DH thinks that we can't go in holiday until the debt is clear

I understand his point, but I also feel that life is for living and that we can't forgo every nice thing. I think that we could book a holiday as long as we stick to the following rules -

the holiday can not add to the debt that we already have
It must be paid for in full - no credit
It must be a cheap option

I just think that we are doing well and paying everything back at a good rate. I feel like I am punishing myself. We have already made huge (but necessary) sacrifices to pay off the debt.

WWYD?

Go. You've done really well but nobody knows what is around the corner and paying off your debt shouldn't be to the detriment of having a life as well.

Your rules are really sensible: paying for the holiday in full, not adding to your debt to go; carrying on paying it off; not spending a huge amount.

Well done for getting to that point, it's not easy.

I would have a holiday too but decide a set budget

I'd be cautious as holidays in school time next year seem insanely expensive so might not be achievable anyway.

the holiday can not add to the debt that we already have
It must be paid for in full - no credit
It must be a cheap option
Your ground rules seem very reasonable, I'd just make sure paid in full includes having money saved to cover all expenses while on holiday, not just the up front costs. Also travel insurance.

How old are dc? How much is in your buffer?

These things would have to be considered for me. Teens who won’t want to holiday with you in 3 years? Go now. 7 year old - wait 3 years.

My friends went to Majorca for their first holiday abroad (dc aged 13-16) and it rained every day. They made the most of it but were a bit gutted to have spent £ and not got the sun holiday they expected in August.

Unfortunately you are not on the same page as your DH on taking a holiday. If you book a holiday, he has to totally on board with it, you don't want to be disagreeing about whether you can afford day trips/water parks etc etc.
For you 'making memories' is important, for him it's paying off the debt. How many times have we read about stroppy teens ruining holidays, sulking husbands ruining holidays or crap hotels ruining holidays? If you persuade him to book and the holiday doesn't turn out to be as you'd hoped, he will resent it. I'm not saying don't book one but you both have to be in agreement that it's a good idea.

How much is the debt? What is the holiday cost..can't imagine it's cheaper than 6k.

I'm probably got a different mindset. Yes you never know what's around the corner...could be a job loss so that would destabilise your family so being financially stable is important.

I agree you need family time but we're had fantastic memories, during COVID when we had to stay in the UK so travel isn't essential.

We went abroad once with dd before she was in primary so may be skewed but have wonderful memories of uk holidays that we went on. Now dd is older she'll remember them so trying to get abroad annually for a week. Budget is nowhere near £6k though.

Any spend not on repaying is adding to the debt. You’re spending on a holiday when you could pay off a bit of debt.

i wouldn’t

I don't think its necessary to go abroad to make memories. I have lovely memories of holidays as a child building sand castles on the beach and searching rock pools in the UK. My adult DC talk fondly of our family holidays at caravan parks in the UK. I think the important thing is doing something fun as a family rather than where you go.

I don't really like the phrase "making memories". As if the kids will only remember an expensive holiday. They will enjoy a holiday with you wherever you go. Just my opinion. Camping is great fun for children.

I wouldn’t. I also don’t like the expression ‘making memories’ but even if you want to why can’t you make them doing things that don’t cost or as others have suggested go camping?

It’s this “life is for living” attitude that got you into debt in the first place. Wait until that is cleared, especially if we’re talking about unsecured debts & high interest rate debt.

Are your savings earning more than the interest on your debts?
In my opinion wouldn't you save loads of money if you paid the 3-4k off your debt? And then went on holiday in 2 years when you are debt free?

I'd book a static caravan in the UK by the coast. You can still make memories, it doesn't need to be abroad or anything fancy. We had a fabulous holiday once at Middlewood Farm Holiday Park, when money was tight.

When you are in debt you have to find a way to enjoy the small things - board game nights, walks through the wood, paddling in the river, building models out of junk etc, baking with the children, cuppa tea with friends etc.

If you can afford to stick to your ground rules and still pay off your existing debt AND add your regular amount to savings, then this sounds ok. But keep in mind that whilst going on foreign holidays is a great experience for kids, you don't need them to make memorable moments. I didn't go on holiday until I was 13, but I have fond memories of days out.

I would compromise and take a self catering holiday on the west coast of France, either camping or a gite or caravan which can be had for around €1000 in school holidays. If you can, take the overnight ferry for more adventure, Le Havre is usually cheaper than caen. Last week of the holidays is generally more cost effective, taking own car (petrol is a bit cheaper than here in France) mostly cook for yourselves it's a change even if more basic.

Hmm. No judgement from me, because it is so easy to get into debt. However, I think your DH is correct. You say ''We got into lots of debt through silly spending and wanting to have everything right away'' and a holiday abroad, falls into the same category, I would say? It's the start of a slippery slope which could lead you right back to more debt.

I agree though, with another poster, that depending what interest you are receiving on your savings versus the interest you are paying on your debts, you would almost certainly be better putting those savings towards the debt, so that the debt is repaid quicker. Normal advice for those in debt, is to pay off the highest interest bearing debt first, then the lower interest ones last. It's only a good idea to put savings before paying your debts, if the interest you are receiving on those savings is MORE than the interest you are accruing on your debt. Otherwise it is costing you more money than it needs to, overall. Interest is currently falling on savings too; Mortgages may get a bit cheaper, but when they do go down savings interest does too

I'm with your DH on this. No holiday abroad ever costs what you planned for. It is highly likely to add to your debt. Do camping in this country, the DC will remember a holiday regardless of where it is.

Well done on making headway with repayments and some savings.

How old are your kids?

We have the most fantastic memories of fun times on days out / cheap holidays and none involved going abroad.

This debt needs paying. By spending now you just prolong the length of time you ‘punish yourself’ for in relaying it.

Once you have your debts paid off you will have the repayment amounts to put towards a holiday plus your current holiday budget.

Don’t do this unless your DH really is on board.

I wouldn’t do it, personally. It’s back to your old way of thinking.

I wouldn't. I would always pay off debt before spending anything further. But then I have a zero tolerance of debt.

We don't go on holiday every year. Some of our best holidays have been staycations pottering about.

I have been in debt myself and I know it hard watching every penny and always thinking before buying any item. Then watching friends going on holidays and saying that your going to x place in the UK this year. You need to look at the bigger picture. You got into debt and your paying it back. You have built up some savings which you never had until recently.
You getting there in regards to your debit payments but you know it going to be another say 2 years when your debit free probably except for your mortgage.

Now you want to have a cheap holiday abroad during school time next year to make memories with the kid's. You won't get a cheap holiday during the school holidays. It not only the cost of the holidays but the new clothes and the spending money when you're there as well. In your situation I would not do this because you end up in more debt.

Instead I would look at Martin Lewis website and see if your getting the best deals on all your current bill's. See if you can get a 0 rate if you can move credit card debit to another card. Chat to one of the debit charities and see if they can help you to improve things quicker.
Then continue to save a bit as well and put it in a high interest earning account.
Look at Dave Ramsey and see what he says about debt and what he recommends to get out of debt and build up wealth.

The truth is that being in debt makes life harder and it means saying no until you get into a better financial position. I have seen people getting out of debit along with building up pensions and savings. Some people were in the position then of reducing hours, taking a good redundancy package or retiring early because they were in a financial position to do so.

I have been in debt myself and I know it hard watching every penny and always thinking before buying any item. Then watching friends going on holidays and saying that your going to x place in the UK this year. You need to look at the bigger picture. You got into debt and your paying it back. You have built up some savings which you never had until recently.
You getting there in regards to your debit payments but you know it going to be another say 2 years when your debit free probably except for your mortgage.

Now you want to have a cheap holiday abroad during school time next year to make memories with the kid's. You won't get a cheap holiday during the school holidays. It not only the cost of the holidays but the new clothes and the spending money when you're there as well. In your situation I would not do this because you end up in more debt.

Instead I would look at Martin Lewis website and see if your getting the best deals on all your current bill's. See if you can get a 0 rate if you can move credit card debit to another card. Chat to one of the debit charities and see if they can help you to improve things quicker.
Then continue to save a bit as well and put it in a high interest earning account.
Look at Dave Ramsey and see what he says about debt and what he recommends to get out of debt and build up wealth.

The truth is that being in debt makes life harder and it means saying no until you get into a better financial position. I have seen people getting out of debit along with building up pensions and savings. Some people were in the position then of reducing hours, taking a good redundancy package or retiring early because they were in a financial position to do so.

No pay off the debt first, as others have said its going back to the old spending ways and could be used to clear more of the debt

I'm another who doesnt like the phrase making memories, how about looking at the sun/tabloid paper £10 caravan breaks in the UK? Ive done a couple with DH in the past and they're just fine, you could take board games, get one near a beach, look at location to see which are based near cheap/free days out. Some have on site swimming pools (unsure if you need to pay as we didnt use it)

You don't have to go abroad, and in the process will save money that would have gone on that, towards the debt.

It must be paid for in full - no credit

This is kind of impossible in my mind because all money you spend on the trip could have been paid off the debt.