Pros and Cons of Taking Out a Personal Loan to Fulfill Your Travel Fantasies

Pros and Cons of Taking Out a Personal Loan to Fulfill Your Travel Fantasies

Traveling the world is a dream come true for a lot of people and the reasons for postponing it are usually of the financial nature. Keep in mind that the emergencies and unexpected expenses have a particular knack for finding their way into your savings account. By spending just one dollar at the time, you might soon find yourself in a scenario where you no longer have enough for the journey.

In other words, waiting until you manage to save enough money for the journey of your dreams can take years, however, what if there’s a particular event that you want to witness. Imagine if the country that you’ve always wanted to visit gets to host an Olympics. In this particular scenario, you wouldn’t be able to wait for next such opportunity, seeing as how you would risk missing a historical event.

To resolve this issue, some people decide to take a personal loan. For them, this is the best (or even the only viable) option, while others see it as a not-so-wise course of action. Which expense is worthy of getting a loan is perhaps one of the questions that will never be completely answered, seeing as how different people have conflicting opinions on this topic. Still, let’s try to look at this from both points of views.

1. Pro: A chance to consolidate your debts

Chances are that you already have a debt or two under your belt, meaning that this particular credit, won’t make that much of a difference to your overall net worth. In this particular situation, you can use this as an opportunity to consolidate your debts. Why not replace several minor debts with a single major one? This can also be an opportunity to avoid having to think about several different due dates and a multitude of different interest rates. Now, you can also use an opportunity to opt for low rate personal loans. All you have to do is consider the cost of the trip when applying for this new loan and add this to the sum that you already have to return.

2. Con: Not using the money for the trip

One of the challenges that you’ll have to resist when applying for a new loan is using the money you’ve just raised for something other than the trip. You see, chances are that you’ll have other issues to resolve, other than using the money for the trip. Sure, you may not see these reasons as loan-worthy, however, once you already get the money, you might find yourself tempted to resolve these issues instead of traveling. While some may claim this to be a semi-decent alternative, you need to keep in mind the fact that we’re discussing the prospect of using a loan for a travel, which defeats the original concept, to begin with.

3. Pro: Forcing your hand

This might not sound like a good thing, however, for an indecisive person to finally take such a leap of fate is a no small thing. This is particularly potent when combined with the previous con on our list, the fear of not using the money for the trip. This may make them act on impulse, in a positive way. Now that they have the money, they need to undergo a journey before the emergency breaks or they start dipping into it one dollar at the time. If you manage to muster the courage to apply for this loan, chances are that it won’t take much effort for you to take the next logical step.

Travel Fantasies

4. Con: The interest rate

One of the problems with personal loans for travel fantasies lies in the fact that they’re usually not that substantial. This means that the interest rate is somewhat higher and the time required to pay them off somewhat shorter. On the other hand, this is situational and it is possible for you to find somewhat more convenient terms. Nonetheless, having to make a decision that depends on your ability to find the right loan at the right time is unreliable, at best. Another con that you’ll have to face is the fact that you can’t pay a personal loan off sooner than agreed. In other words, even if you did cover it at once, you would still have to deal with monthly bank fees.

5. Pro: A heftier travel budget

By applying for a loan, you’ll feel less inclined to make budget cuts where you don’t have to. This means that you’ll get the privilege of traveling in style. Sure, you’ll eventually have to return every single dollar you spend (even a bit more), however, your travel budget does affect your experience as a whole. Think about it, while it’s possible to make a budget-friendly itinerary, this is not necessarily the best course of action, nor the direction in which you should plan. Instead, you could just make the plan for the tip of your dreams, put it to a calculator and then apply for a loan.

At the end of the day, you need to understand that the concept of something being “worth it” is a subjective matter, to say the least. So, it all really comes down to the way you perceive these pros and cons. Still, in order to make a proper decision instead of just making a move on an impulse, you need to look at things from several perspectives, as well as consider all the facts. Only then can you rest assured, knowing that you’ve made the right call.