Travel is rapidly becoming the new measure of success.

If you’ve been putting off planning that dream vacation because of financial issues, vacation loans might be the solution. They allow you to spread your vacation costs into smaller monthly payments instead of a single large payment.

Keep reading to learn more about loans for vacations and discover if they’re for you.

What Are Vacation Loans?

A lot of people are surprised to hear vacation loans are even a thing. The traditional wisdom was if you couldn’t afford to pay cash for leisure activities, you couldn’t afford to do them. Unfortunately, many people ignored this and just put their vacations on a high-interest credit card.

Thankfully there are now many lenders who understand the needs of modern families and consumers. They know taking a break is a necessary part of life and provide a cheaper alternative to high credit card interest rates.

A vacation loan is just what it sounds like – a loan to pay for taking a vacation. It allows you to make installment payments for your trip instead of having to pay for it all at once. You can either use a traditional personal loan or one of several companies specializing in vacation payment plans.

The Pros

Going on vacation is an excellent way to de-stress from long hours and hard work. It can also be a great way to create memories for the whole family. If you’ve recently gotten a raise or started a new position with more pay, waiting a year or more to save up for a vacation isn’t very appealing.

Taking out a vacation loan allows you to parlay your new income into a much more immediate trip. If you have good credit you can even do so for a relatively small amount of interest and fees.

For many people, you’re going to take the vacation no matter what. Budgeting is hard and you need a break. If it’s a choice between putting your vacation on a high-interest credit card or pursuing dedicated vacation financing, the financing is usually the better option.

The Cons

There’s no getting around it, you’ll pay more for your trip using a vacation loan than by saving up and paying cash. You have to pay interest, loan fees, and in many cases, you’ll have to go through a provider’s in-house trip system. You might not get the best deal on your flights depending on when you book and how you do so.

It’s extremely important that you carefully read the fine print before you sign anything. Most lenders are honest people, but some may try to slip hidden fees into your contract. You should also always ask for the APR of your loan.

Many vacation lenders offer you a flat fee instead of adding interest onto your payments. This may seem like a way to save money but could actually end up costing you big time.

If you’re financing a $3,000 vacation and are asked to pay a $750 dollar fee it may seem like a good deal. But, this actually adds up to 25% interest, more than on many credit cards. By always asking for the actual APR on your loan you won’t have any surprises.

How To Get Vacation Financing

If you’re still interested in financing your vacation there are several ways to go about it. You can either contact a company who specializes in personal loans for vacations or get a traditional personal loan.

The specialty companies make it easy to get started and generally require only a small upfront payment. You can buy your flights, hotels, and even activities using the financing provided. They handle the payments and send you all the ticket information.

Start the process by filling out some basic information on your finances and submitting a loan request. In most cases, they will run a credit check so if that will be an issue for you, be forewarned. Once you’re approved they’ll offer you either a set amount or in some cases list out trips they have available with financing.


If you’re interested in saving money on your vacations but don’t want to go through actual vacation financing there are other options available.

0% Interest Credit Cards and Credit Card Points

If you have good credit you might check out introductory credit card offers. Credit card providers are eager to get new customers. Many offer 6, 12, or even 24 months with no interest payments to entice you.

This is a great way to finance your vacation without paying any interest at all. If you already have high-end points cards you can often plan out your spending to maximize your points. If you do it right you can often cover a good chunk of airline tickets or hotel spending.

Time Share Presentations

One of the oldest ways to get discounts on vacation expenses is to go through a timeshare presentation. If you agree to listen to a one- or two-hour high-pressure sales talk you can often get free or discounted hotel rooms, theme park tickets, or other vacation benefits.

Make sure you don’t listen to their sales pitch, though. Buying a timeshare is one of the worst investments you can make.

Personal Loans

If you don’t qualify for 0% interest credit cards or don’t have excellent credit, a personal loan may be the best option. Companies such as Bonsai Finance specialize in providing loans to good people with less than perfect credit.

They generally have higher interest rates than some other lenders but are often the only loans consumers without good credit qualify for. They are also much lower than high-interest credit cards, usually the only other alternative.

Remember to Have Fun

Going on vacation should be about relaxing and enjoying yourself. Try not to stress out too much about your finances while you’re there. Using vacation loans can be an excellent way to simplify your planning and save money from high-interest credit cards.

Check out our checklists section to learn useful tips and tricks for destinations all over the world.

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