TRAVEL ARTICLES
Thursday, 16 August 2007
Over a million Brits still paying off last year's holiday
Approximately 1.4 million British holidaymakers are still counting the cost of the two-week break they took last year according to research conducted by Moneynet. This is due to the rising interest on the debts incurred in financing that break. A further 926,000, who used loans or credit cards to finance their trip have taken a full year to clear their debts - only to begin the process all over again with the next holiday season.
With debt-related figures on the increase, many lenders are reflecting the trend by charging higher interest rates and offering smaller loans, with regard to financing holidays.
However, research suggests that 10% of holidaying Britons are likely to embark on their next holiday before having cleared any outstanding debts incurred by the previous one. Of those interviewed, 44% revealed that they had not fully saved up for their next holiday, seeing it as something to worry about at a later date.
But there is a growing fear that this is indicative of an increasing debt-culture that seems to be thriving and increasing in the UK.
Overspending abroad is also a major contributing factor to these figures. 27% of those surveyed stated that they spent more than they had budgeted for whilst on their last holiday. Of that 27%, a further 9% admitted that they had overspent by between £500 and £1000.
21% revealed that they supported extra costs by charging them to their credit cards, whilst knowing that they potentially had no way of meeting the imminent repayments. This resulted in 20% of that figure saying that they had to drastically alter their spending habits when they returned from holidaying. There is also an ever growing trend to switch to the best current balance tranfer offer; at the time of writing - 0% on balance transfers for 13 months offered by Natwest Credit Cards and RBS Credit Cards, in order to extend the life of the debt as an alternative to paying it off.
The average family takes two holidays a year, increasing the financial strain on their resources, while it seems that those in the 55 and over age bracket will take breaks abroad up to five times, annually.
With debt-related figures on the increase, many lenders are reflecting the trend by charging higher interest rates and offering smaller loans, with regard to financing holidays.
However, research suggests that 10% of holidaying Britons are likely to embark on their next holiday before having cleared any outstanding debts incurred by the previous one. Of those interviewed, 44% revealed that they had not fully saved up for their next holiday, seeing it as something to worry about at a later date.
But there is a growing fear that this is indicative of an increasing debt-culture that seems to be thriving and increasing in the UK.
Overspending abroad is also a major contributing factor to these figures. 27% of those surveyed stated that they spent more than they had budgeted for whilst on their last holiday. Of that 27%, a further 9% admitted that they had overspent by between £500 and £1000.
21% revealed that they supported extra costs by charging them to their credit cards, whilst knowing that they potentially had no way of meeting the imminent repayments. This resulted in 20% of that figure saying that they had to drastically alter their spending habits when they returned from holidaying. There is also an ever growing trend to switch to the best current balance tranfer offer; at the time of writing - 0% on balance transfers for 13 months offered by Natwest Credit Cards and RBS Credit Cards, in order to extend the life of the debt as an alternative to paying it off.
The average family takes two holidays a year, increasing the financial strain on their resources, while it seems that those in the 55 and over age bracket will take breaks abroad up to five times, annually.
