Make the most of your money

Using a Loan for Travel & Leisure

trip travel holiday

How to enjoy a champagne holiday on a coca cola budget

The rand exchange rate against most major currencies and soaring airfares have made the idea of jetting off overseas on holiday a pipe dream for many South Africans.

Yet there are ways that you can turn your dream holiday into reality a little sooner than you thought, if you combine a little careful planning with some insider tips.

Airfares are going to account for a chunk of your budget. The secret here is to understand how airlines manage their seat sales. Within each cabin – economy, business, first etc. – they sell different types of tickets. The price of the ticket is determined by the terms and conditions attached to it. The more restrictive the conditions the less you pay.

For example if you are flying in economy, but you want to be able to change your date of travel at a minimal cost, you’ll pay much more for the ticket than someone in the seat next you, who opted for a less flexible type of ticket.

You’ll get the best discount by booking well in advance as airlines try to sell the cheaper, less flexible tickets first. They know these seats will sell quickly. To make sure that customers don’t change minds at the last minute and leave them with unsold inventory, they charge substantial penalties for any changes to these cheap bookings. The closer it is to the departure date and the fewer seats are left, the more people pay.

The next tip is to try and book during times of low demand. Prices will tend to be higher during school holidays or around major sporting events. The festive season should be avoided unless you’re happy to travel on Christmas Day or New Year’s Eve, when demand is typically low.

The internet is a powerful tool for travellers and will let you compare airfares. What you’ll usually find is that carriers flying via a stopover point often charge less than those which operate directly. Be sure, however, that this isn’t a false economy as you may need to spend money on something to eat and drink during a long layover. Transfers also increase the chances of lost luggage.

When considering your route, visa costs are something else to take into account. You can usually find information on visa requirements and costs on the country’s website.  

The internet is also a good way to find and compare accommodation. Once you’ve narrowed down your choices it is worth double-checking that they deliver what the website promises on review sites such as TripAdvisor.

At this stage, if you’re an experienced traveller and have booked online before you can go ahead and commit. If, however, you’re unsure or if your trip involves multiple flights and connections on different airlines, it may be well worth paying the consultation fee and visiting a travel agent. The few hundred rand you pay could bring a peace-of-mind dividend and offset the stress and additional cost of missing a too-tight connection.

Once you’ve got your trip booked, plan what you’re going to do when you get there. Pre-booking activities can save you money and also makes it easier to stick to your travel budget. Doing things on a whim when you get there can be expensive.

While the internet is an invaluable tool for today’s travellers, there’s no substitute for first-hand experience. If you know someone who has visited your dream destination, glean all the information you can, both good and bad. Find out about the experiences not to miss as well as the rip-offs.

Finally, use all the knowledge you’ve accumulated to put together a daily budget. Remember to include accommodation, sight-seeing, food and a small contingency. If you don’t spend the spare money, use it to treat yourself or to put towards your next trip.

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Loan repayment terms range from 24 to 72 months. The maximum interest rate with regards to a DirectAxis Personal Loan is 27.75% per annum (compounded monthly). Your rate and initiation fee will be determined according to your personal risk profile.
An illustrative example of a loan at an interest rate of 27.75% per annum would be: Loan amount R50 000 plus a once-off initiation fee of R1 197.00 and a monthly admin fee of R68.40, over 72 months.
The total cost of the loan will be R 110 529.68 which is an Annual Percentage Rate (APR) of 30.95%.