A new survey by TotallyMoney.com has found that holiday spenders in the UK will put 8% more of their bills on their credit card, racking up an astounding £9 billion collectively. The increase means that over a quarter of all holiday spending will now be billed to credit cards.
Worryingly, 11% of the people that take international holidays this year will only make the minimum repayments on their credit card balances, meaning that even “cheap” trips to destinations such as Tenerife could end up costing almost twice as much as they should and take more than 10 years to pay off.
Credit card usage has soared in the UK as families and individuals struggle to deal with rising living costs. An increasing number of people are putting almost all of their leisure spending – holidays and consumer shopping – on credit cards in an effort to delay repayments.
While a short trip to Tenerife could cost as little as £1,200, credit card interest and long repayment periods can increase the cost to as much as £2,100. Travel further from Britain and the cost increases even further – a £3,561 trip to New York City is an incredible £3,000 more expensive if you pay it off over 16 years.
Consumers are well aware of the dangers of excessive credit card spending, but an alarmingly large percentage of individuals and families are nonetheless opting to buy costly international holidays using their credit cards. Twice-bankrupt Kerry Katona visited Tenerife in January – signalling, some experts believe, that holidays aren’t an unaffordable luxury, even for the financially distressed.
While the smart choice is to avoid international travel and instead holiday at home in the UK, many consumers are choosing to avoid thinking about the repercussions of credit card use and travel internationally anyway. Financial experts are worried that dependence on credit cards could lead to serious consumer debt issues.
