How to Finance Your Travel With Vacation Loans

Michael Collins
Dec 07, 2020

In times like these, stress levels can be extremely high. COVID-19 has put huge amounts of stress on individuals and families alike. A common remedy to escape stress is a vacation. Unfortunately, the pandemic has brought upon huge amounts of financial strain that has limited many people’s ability to escape the stress and go on a vacation. Fortunately, there is still a way you can take that much-needed vacation, even if you do not have the money for it. A vacation loan could be your ticket to escape the world for a little while. 

What are Vacation Loans?

A vacation loan is typically a personal loan that can vary in both amount and loan terms, depending on your needs. A personal loan can range anywhere from $25 to $100,000. With a vacation loan, you borrow money from a lender and come to an agreement on the repayment term. Once you receive your loan money, you can use it to pay for your vacation however you see fit. 

If you get a large personal loan to finance your vacation, you will likely be paying your loan off for a longer amount of time, but with a lower interest rate. If you get a smaller personal loan, you can expect to have to pay your loan off relatively quickly and with a higher interest rate than a larger personal loan. Whatever the case, you will come to an agreement of the terms with your lender. If you have creditworthiness or good history you can expect to have better terms offered to you and you may even have a little more room to negotiate for an even better loan term. If you have bad credit, you can expect to face higher interest rates and less favorable terms with little to no room to ask for a better deal. 

What can a Vacation Loan Pay for? 

As you already know, there are many types of expenses that come with a vacation. If you are going on a road trip, you will need to pay for gas and a place to stay every night. If you are flying, you will need to pay for your flight there and back. Regardless of where you are going, you will need to pay for food as well as entertainment. All of these expenses can really add up, so a vacation loan can be extremely helpful. 

For booking flights or hotels, you could get a personal loan to pay for these. Should your flight and sleeping arrangements be expensive you can take out a larger loan. If you only need a few more dollars to be able to book these arrangements, you could take out a smaller personal loan, like one from Possible. If you plan well and budget accordingly, you could have your entire loan paid off before you ever take your vacation. Doesn’t that sound nice?

Let’s say you’re going to the great city of Seattle, and all of your arrangements are paid for. Likewise, you have enough money set aside for expenses but you want to do a tour of the Space Needle but that cost is not in your budget. If you do not have the cash on hand to afford an expense like this, you can apply for a payday loan alternative or an installment loan with Possible. You could apply and have the money to go to the Space Needle within minutes. Even if you have bad credit, you could still have access to our loans!

Should I Get a Vacation Loan?

While a travel loan can be critical for being able to go on your much needed vacation, loans are not for everyone. It is important to know why loans can be useful as well as the risks that are associated with loans. 

One important part of loans that financial advisors stress is that you should not take out a personal loan for things that are frivolous or unnecessary. If it can be avoided, you should always try to not take out debt if you can. If you have the ability to pay for something, you should. Taking out debt means you have to pay interest charges which can be expensive, especially with the potential of an added late fee. 

While you may think vacations aren’t necessary, they can actually be very good for your mental health and can help you de-stress. However, if you have money to pay for your vacation you should not take out a loan. If you do need a loan though, plan for a vacation that is within your budget. If you are struggling to get by, taking a vacation to Europe or somewhere extravagant is not a good idea. You could find yourself in a deep hole, needing to take out even more debt. This could put you in a loan trap cycle which you should avoid at all costs!

Let’s look at some of the other pros and cons associated with getting a travel loan so you can decide if you should get one or not. 


  • Makes Going on a Vacation Within Reach: The obvious pro of a vacation loan is that it gives you the ability to go on a vacation when you otherwise may not have been able to. Stress can pile up on you and can really affect your work and home life. If you need a getaway but do not have the money to do so, a vacation loan can be one of your best loan options. In a perfect world, saving up for a vacation is safer for you, but that is not always the case and you may need a vacation sooner rather than later. 
  • Vacation Now, Pay Later: With a vacation loan, you may not have to pay the full amount off for some time. This means that you will be able to enjoy your much-needed vacation without needing to stress about paying it off right away. Depending on your loan, you could be paying it off for many months or even years, which means your monthly payment should be manageable. 
  • Likely an Installment Loan: Your personal vacation loan will likely be an installment loan. This means that you will be paying off the loan principal, plus some interest, every week or month, depending on the structure of your loan. This type of loan is very common and is much easier to pay off than a loan that needs to be paid off in a week or two, like a typical payday loan. Depending on your loan terms, with an installment loan you could be paying it off for many months or even years, which means your monthly payment should be manageable.


  • Can be Financially Stressful: While you may not be thinking of how you are going to pay off your loan while you're on vacation, you may be facing a harsh reality when you come back from your vacation. Having debt can be very stressful. Having to worry about another loan payment while worrying about rent, utilities, food, and other expenses can be very stressful. If you are already paying off another loan, having to deal with multiple loans can be stressful and overwhelming. You might find that you are more stressed out after your vacation than you were before your vacation! 
  • Unnecessary Debt: As a general rule of thumb for financial health, you are supposed to avoid taking on debt if possible. You are not supposed to take on debt that is for frivolous or unnecessary things, as it puts an additional financial burden on yourself when it is not completely necessary. In terms of debt that is unnecessary, a vacation loan is up there at the top of the list. Compared to a home loan or a car loan, both of which can be very important if not necessary, a vacation loan is arguably something that you could live without. Getting a loan is not your only option for getting money for a vacation, and you may end up digging yourself into a hole financially as a result of the loan. 
  • May be Too Small or Too Large: While you will need to budget for a vacation anyway, there is a chance the amount of your loan falls short of what you need or ends up being too much. If your loan amount is too short, you may be out of luck and your vacation plans may not come to fruition. This could mean cutting your vacation short or not doing the things you went on the vacation to do. On the other hand, if you get too much money from a vacation loan, you end up losing money. While you can certainly use the leftover money words paying back your loan, you are still going to have to pay interest. This means your loan is more expensive than it needed to be and you are losing money. 

Need a little cash for a vacation? Possible can help you out.


Other Strategies to Pay for Your Vacation 

Again, taking out unnecessary debt is something that should be avoided if you can. While you may certainly need a getaway, the downsides of having debt that you could otherwise avoid means you may want to start looking into other options for getting money to get money for a vacation. Here are some available options to get money instead of a vacation loan: 

  • Save like Crazy: Saving money for vacations is likely the most commonly used way to get money for a vacation. While having additional income to save money might not seem like a possibility for you, budgeting is a great way to use your income as efficiently as possible. Budgeting methods like zero based budgeting are great ways to lower spending and find money to save that you may never have been able to see before. Here is a list of our favorite budgeting apps
  • Money Making Apps: There are many apps available today that allow you to make some extra money on the side. Whether these apps involve you picking up a side gig or just saving money from everyday purchases you would make anyway, these apps are a great way to start making some extra cash that you will need for your vacation. Here are our go-to money making apps

The Bottom Line

While a vacation may seem out of reach without the help of vacation loans, taking on unnecessary debt and additional interest charges is not recommended and should be avoided, if possible. Try saving before you take out debt. If saving money or getting a side gig does not seem like an option and a loan is your only choice, make sure you will have the ability to pay it off when the time comes. If you get a loan that is too expensive for you, you could become overwhelmed with making payments. If you begin to miss payments, your loan will only get more expensive and your credit score will start falling. Overall, avoid a vacation loan if you can, but be smart about one if you are set on getting one. 

A Vacation Loan with Possible Finance

If you are hellbent on getting a small vacation loan or you are just a few hundred dollars from having enough money to go on your vacation, consider getting a small personal loan with Possible. At Possible, we offer small installment loans of up to $500. Unlike other personal loans of this size (i.e. the wretched payday loans), you do not need to pay back your money within a week. We allow you to make equal payments over the course of a month. Should you struggle with making your payment or you just don’t want to make a payment during your vacation, you can extend your loan payment within the app up to 29 days later. 

At Possible, we are fighting for financial fairness in an industry that is riddled with injustice. Because of this, we want to build value for our customers instead of keeping them in a debt cycle like other lenders. When you pay back our loans, your credit score increases, which many other lenders do not do. If you need just a few more dollars for your vacation or you are finding you ran out of money on your vacation, consider getting a loan with Possible! Download our app and get started. 

Michael Collins

Michael has a passion for writing and has since brought that passion to Possible. He enjoys reading everything there is to know about film, sports, and finance. His studies in college allow him to be on the forefront of business knowledge so he can better inform his readers.

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