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According to a survey by WalletHub, 46% of Americans are still paying off a credit card balance from a vacation they took last summer. If your vacation cost $2,000 with a 27% interest rate, you paid roughly $300 more for that same vacation. Think about it—what could you do with an extra $300 besides giving it to a credit card company?
In this blog post, we will discuss what you should do if you feel like you deserve a vacation, how to prepare for one, and how to avoid some of the pitfalls that can drive you further into debt. Welcome to Financial Advisors Say the Darndest Things, where we teach you how to be rich in spirit and righteous in action.
Introduction
Welcome back. My name is A.B. Ridgeway. I’m the host of Financial Advisors Say the Darndest Things and my mom’s favorite Christian financial advisor. Today, we're talking about vacations. As a Certified Private Wealth Advisor®️ professional with over a decade of experience, I know how it feels to want to take a vacation.
When I was younger, one of the things I used to say to myself all the time was, "You know what? This job is stressful. People are irritating me. I deserve a vacation."
The "I Deserve It" Mentality
This mentality tends to grow with us. So, what do we do? We take our credit cards, go on the biggest vacation we can, and then come back only to realize that we have to pay for the things we enjoyed.
It's tough to pay for something you’re not enjoying anymore. If you took a vacation last summer, you might still be paying for it. The good feelings from that one or two-week vacation are gone, but the pain of paying for it month after month lingers. We need to address the idea that we deserve a vacation.
Why Do We Feel the Need to Get Away?
The reason we say we want a vacation is to get away from the stressors in our daily lives. Many times, this means work-related stress or family issues.
When we talk about building a life that doesn't require constant vacationing, it means addressing the root causes of stress. Taking a vacation only delays the resolution.
What's going to happen?
You'll go on vacation, come back, and still feel the same.
You don’t need relief; you need solutions.
Tackling Unforeseen Vacation Expenses
When I was younger, I didn't account for unforeseen expenses. Especially when vacationing out of state or country, there are costs we don’t prepare for. These could include transportation, dining, excursions, and local activities you didn’t initially plan for.
We often fall into the sunken cost fallacy—thinking that since we’ve already spent $2,000, what's another $100 or $300 to further enjoy a special show?
But when the vacation is over, reality hits. One month later, you're faced with that bill, and the happy memories start to fade away as financial stress takes over.
Avoiding Vacation-Induced Debt
Understanding the Myth of "I Deserve It"
First, we need to understand that vacations don’t solve mental issues; people do. We need to address the root cause of our stress and anxiety instead of relying on temporary escapes. Let's focus more on the "I've earned it" reality rather than the "I deserve it now" myth.
Key Points:
Be debt-free to enjoy your vacation better.
A sense of accomplishment comes from earning your vacation.
The ideology of "I deserve it now" drives unnecessary credit card debt.
The Vicious Cycle of Debt
Here's a compelling quote from one of Dave Ramsey’s co-hosts about vacation debt:
"I think if you're going into debt for a vacation, you're saying, 'I deserve this.' You buy something you can’t afford, go into debt for it, start paying it off, and then see something else you 'deserve,' and buy that too. It’s a vicious cycle."
Planning the Perfect Vacation
Research and Preparation
1. Research: Look into hotels, flights, accommodations, and available amenities.
2. Build Your Dream Vacation: Don't worry about initial costs; list out activities and their estimated expenses. Add 20% for unexpected costs.
3. Take Care of Existing Debts: Pay back the money you owe before planning a vacation. This means paying for daily essentials first.
4. Save Regularly: Aim to accumulate three to six months of saving expenses as a backup.
Avoiding Pitfalls
1. Over-the-Top Vacations: Determine whether you can afford a lavish international vacation or a simple staycation.
2. Longer Than Necessary: Sometimes a week-long trip is less feasible financially compared to a refreshing weekend getaway.
Focus on Mental Health
If you're feeling depressed or anxious, consult a professional. Solving these issues ensures that your vacation serves its true purpose—a place to rest.
Conclusion
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Let’s make vacations a proactive response to a happy life rather than a reactive escape from a stressful one.
My name is A.B. Ridgeway, and I’ll see you on the other side of your blessing.
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Feel free to share your thoughts and experiences with vacations and financial planning in the comments below. Let's learn and grow together!
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As Christians, we were taught to be good stewards over our tithing and giving to the less fortunate. But when it came to our personal finances and investing we were left clueless on what the Bible says. What does the Bible say about managing debt, leaving a legacy, investing, and planning for your retirement? Mr. Christian Finance answers these and many other questions because we want to teach you how to become rich and righteous!
Meet A.B. Ridgeway:
A.B. Ridgeway, MBA, CPWA®️ (info@abrwealthmanagement.com) is the owner and Christian Financial Advisor with A.B. Ridgeway Wealth Management. With a decade in the finance industry, his goal is to give believers clarity around the most confusing topic in the Bible, money, and tithing. A.B. Ridgeway helps tithing Christians become cheerful givers but unlocking their money-making potential, so they can prosper and be the great stewards of the wealth God has entrusted them with.
*Disclaimer: This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy or the completeness of any description of securities, markets or developments mentioned. This is strictly for information purposes. We recommend you speak with a professional financial advisor.
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