Can you travel while you’re in debt?

Some people would say that it’s irresponsible to do so, that it’s a waste of the money that you could otherwise use to pay off that debt.

But is it really? Is it necessarily irresponsible when someone who is in debt travels?

It’s possible to travel responsibly when you’re in debt

If you actually have a big debt, it could take you a long time to pay it off. Depriving yourself of fun throughout all that time is unrealistic and unsustainable. You have a limited amount of self-control; it’s simply impossible to deny yourself everything all the time.

That’s why all healthy budgets — yes, even those that belong to people in debt — have some room for fun. Some people get their fun from eating out, some people simply have to shop and others need to travel.

It’s okay to travel when you’re in debt, as long as…

…you remember the golden rule: don’t take on more debt to travel.

Oh, and another one: stick to your debt repayment plan.

Rule #1. Don’t take on more debt to travel

Before you decide to travel, check your bank account. You should have enough cash to pay for all your expenses during the trip.

You don’t have to actually use cash to pay for everything; just make sure you have enough cash to pay for all your expenses upfront. If you use your credit card to pay for some things during the trip (as you should — it’s safer and the exchange rates are better), then you should pay off that balance as soon as it becomes due.

Rule #2. Stick to your debt repayment plan

If you usually pay $300 per month toward your debt, keep doing that, even while you’re traveling. If this isn’t something you can do, don’t travel.

If you don’t even know what a debt repayment plan is, definitely don’t travel. Sit down with your papers and plan how you’re going to pay off your debt. Figure out how long it’ll take for you to eliminate your debt and how much you’ll need to pay every month. That’s your debt repayment plan. Stick to it.

3 little things you may need

As a traveler who’s in debt, you have specific financial needs. The three things below, to some degree, may help you to travel.

1. Separate savings account

To make it easier for you to see if you have enough cash to pay for your trip, set up a separate savings account. (Get a free account, of course.) This will help you psychologically see your debt repayment money and your travel money as two separate imaginary stacks.

2. Interest-free debt

If you can defer your debt repayments without being charged interest, go for it. (Interest increases your total debt amount — remember Rule #1.) Keep in mind that truly interest-free debt — like certain government student loan programs or loans from your family members — is rare.

Some banks offer balance transfers into loan products, charging 0% interest for a set period of time. For example, the bank may let you transfer your loan balance into their credit card without charging any interest for the 18-month introductory period. If you choose this option, keep in mind that the interest will kick in at the end of the introductory period. Double check your debt repayment schedule to make sure you’ll be able to pay off the balance before then — especially if the non-promotional interest rate is higher than your current interest rate.

3. A job abroad

Just because you’ll be away from home doesn’t mean you won’t be able to make any money.

This is not practical if you’re planning a short trip, of course. But if you’ll be gone for months, then you could very possibly secure a job at your destination before you leave. This way, you’ll have a sure source of income during your travels. Just make sure that you’ll make enough money to cover your living expenses, as well as your debt repayments.

Some ways you can make money as you travel:

• Some ESL teachers get free accommodation from their employers, so they get to save a big chunk of their incomes.
• If you’ll be leaving your home behind for long-term travel, you can rent it out to get extra income. Some travelers started out doing that and ended up buying more rental properties to fund their travels.
• If you already work from home like I do, it’s a simple matter of being disciplined enough to work a number of hours per day.
• Check out this page to get more ideas on how you can earn money abroad.