Money comes and goes but you’re only going to be travelling to Europe in your 20s once. Or at least, that’s the vibe I get any time I open Instagram and TikTok between May and September every year.
Though we’re firmly in a cost of living crisis, the amount of people choosing to take holidays hasn’t gone down — the number of Aussies taking overseas trips this year is 32 per cent higher than last year.
However, this isn’t just people tapping into their savings or working extra shifts in order to book flights. A recent survey found that 40 per cent of Australian adults don’t pay for their holidays upfront, instead choosing to use credit cards or By Now Pay Later services.
While it may seem like a great idea at the time… is it worth going to debt for a holiday?
When I put the question out on Instagram to chat with people who had gone into debt to travel, the response was overwhelming. My friends have taken out thousands in credit card debt to book flights, take bucket list trips around Europe, and travel internationally to see their favourite artists in concert.
One Aussie who now lives in Canada told me she spent a year paying off a $4k trip back home, and plans to do the same thing again within in the next year.
Another told me she had no regrets after taking on debt to do a whirlwind bucket list trip around Europe after living in London for a year.
Earlier this year, a traveller in their 20s caused ‘outrage’ when she spent $50k they’d been saving for a house deposit on a Europe trip. Though she said she had no regrets, the overwhelming feedback (from strangers) was that it was an unwise financial decision.
“You don’t know what’s going to happen in the future, like, you could die tomorrow. And I’d rather see the Northern Lights than, you know, see nothing,” she told Yahoo!.
This begs the question — is there a ‘right way’ and a ‘wrong way’ to spend your money? We’ve been conditioned to think that when it comes to big purchases, real estate = good, fleeting fun = bad.
But at the same time, Millennials and Gen Z are constantly being confronted with the reality that the majority of us aren’t likely to be able to buy a house any time soon. What’s the point in sacrificing and saving when, upon crunching the numbers, we learn it’s going to take at least 15 years to save for a house deposit?
And in the grand scheme of things, a $10k Europe trip is barely a dent in what you’d need to buy a house, so why not take the trip when you can?
In the last two decades, travel has, for many people, been upgraded from “optional” to “priority”, US-based professor of public policy Elizabeth Currid-Halkett told CNN earlier this year.
Of course, like every other social phenomenon, this was exacerbated by the pandemic and the need it gave us to live in the moment.
Why should we let something as small as money stand in the way of doing what we want, especially when there may be another pandemic, financial crisis, or war that stops us from doing so in the future?
“The idea that our friends matter, living life matters, how important living a good life is… that has led to a change in how people spend their money,” Currid-Halkett said.
Social media has also played a huge part in the way we see travel as a necessity, not an option. Travel influencers and digital nomads have made exploring the globe seem a lot easier, cheaper, and more accessible than it actually is. Even the need for regular Joes to showcase the highlights of their holiday on Instagram and TikTok gives us a false reality of what travel should be.
The videos pushed into our feed are those of people frolicking on Greek Islands, drinking 20 Euro cocktails, flying from city to city — all expensive activities that add up quickly.
While I believe it’s fine to take on debt to travel, it still pays to be mindful of your money – Euros may look like Monopoly money, but that doesn’t mean you can spend them willy nilly.
The interesting thing to note is that of everyone I talked to, not a single person wished they’d never taken on the debt. They had to make a few sacrifices when they got home — work a little more, spend a little less. But it was all worth it.
In fact, a few even said they wished they’d travelled and experienced even more when they could.
So long as people are aware of the repayment plans and the interest amount before committing to taking on the loan, there shouldn’t be any issues associated with travel-related debt.
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