Summer vacation is around the corner and many of you must be planning a trip abroad. While planning for an international trip, from applying for a visa to buying flight tickets takes time and money. If you are a last-minute planner, you don’t want to get stuck in an alien land with limited funds.
Here’s how you can financially manage a trip:
Pick An Offbeat Place: One way to cut cost is to either avoid travelling to a place during its ‘peak season’ or pick a place, which is not very popular or commercialised. It is not hard to come by a place, which is beautiful yet cheaper. You can cut cost further by opting for local transport and food while travelling. Travelling light would help you avoid paying additional charges for luggage. These small adjustments can help you save money substantially.
Look For Deals: Travel websites, in order to compete with each other, often offer discounts and attractive deals on purchase of flight tickets, booking hotels, shopping, etc. Watch out for such offers. Some websites also give you the option of package tours. Before you zero in on an item, do your research and compare deals from different websites to make the most of it.
Use International Credit Card: In case of fund insufficiency, try using an international credit card for day-to-day transactions. Travel cards can earn you reward points, cashbacks, etc, on transactions such as hotel bookings, flight bookings, etc. However, usage of credit cards abroad can attract charges on cash withdrawal, currency exchange, POS swiping, etc. Before you set off, make sure your credit card company is informed about the probable use of the card to ensure you get uninterrupted service.
Opt For A Personal Loan: You could also go for a personal loan to fund your trip provided you have a repayment plan. You can convert the cash into a debit card, prepaid card, traveller’s cheque, foreign currency, etc. However, the interest rate is typically high on personal loan ranging from 11 per cent to 20 per cent.
Travel Loan: Certain banks and financial institutions offer travel loan, which is a variant of personal loan, to fund overseas travel. Ranging from 11 to 18 per cent, the interest rate varies from bank to bank.
Financing Through A Travel Operator: Many international travel operators allow travellers the option of making payment once back from the trip. These operators finance these schemes through tie-ups with NBFCs and financial institutions. These schemes offer up to Rs 5 lakh, covering sight-seeing, food, accommodation, flight tickets, etc. The interest rates are similar to that of a personal loan. The repayment period usually ranges from one year to five years.
For your next trip, remember to plan in advance, by setting aside an amount systematically every month. Booking flights and hotels cost way less when booked early.
(The writer is CEO, BankBazaar.com)