Fly Now, Pay Later: How To Budget Borrowed Money For Emergency Travel
Traveling to your dream destination on borrowed money is often a bad idea but during emergencies, charging all your expenses on credit is a reasonable option. While no one wants to accrue debt in any situation, a CNBC report notes that over 60% of Americans are unprepared for a $1000 emergency. With this in mind, most Americans only have their credit cards for emergency funding. Budgeting during an emergency can be difficult though but you can set an amount that you can afford to pay back and find ways to cut back on major expenses such as transport costs and accommodation so you do not go over budget.
Borrow what you can afford
It is hard to think straight during an emergency especially if said emergency requires you to travel across the country or overseas. However, setting a limit to how much you spend will save you from debt. While using credit is encouraged in such situations, it is easy to go overboard. Utilizing only 30% of your credit is a good spending limit to follow. If you do this, it will show your creditors that you are responsible with your credit. However, in an event where you need to max out your credit card, make sure that you have enough income to pay it off later on. It is also wise to pay off balances completely to maintain or improve your credit score. If you have a rewards card, it is a good idea to use it instead of using a regular credit card.
Decades ago, major airlines used to have policies that offered lower airfare costs to passengers who suffered bereavement or those who have a sick family member who lives across the country. While USA Today notes that such policies are no longer in place, it is still a good idea to give major airlines a call. Airlines can give you a discount on airfare for this type of emergency. For other emergencies, you can book your flight on Momondo, a flight search engine known for offering the best deals. It is also advisable for you to pack light so you don’t have to pay extra for your luggage.
If you are not staying with family, you would need to find a cheap hotel or bed and breakfast in the area. Last minute booking can save you lots of money, according to Time Magazine because in the eyes of the hotel management, you are a replacement for those who have canceled their bookings. One good app that Time suggests is HotelTonight, an app that helps you scour for last minute deals. If you always book a certain hotel during your travels and have their app, booking them will save you some money too. It is important to remember that no one wants to ever arrange for emergency travel and no one wishes it on others. However, having the presence of mind to budget your spending during such a difficult time will save you from further heartache in the future.