5 Things to Prepare Financially For A Vacation and How A Vacation Loan Can Bring A Stress-Free Holiday (2019 Update)

Going on a vacation is both exhilarating and refreshing! We all know that Singaporeans enjoy travelling and going for a holiday. Be it a short weekend getaway or a long relaxing trip to Japan or the USA, a lot of financial and logistical planning will be needed before the trip. It is best to be prepared financially.


What are some of the necessary financial preparations?

Here is our condensed list:

1. Inform the credit card issuers:

The traveller should remember to inform his or her credit card providers of the planned vacation. The lenders should have details of the dates that the traveller will be on vacation and the destination country. This prevents the customer from getting his or her card declined during the vacation. It might be a little embarrassing and troublesome should that happen. Once the lenders are aware of the cardholder’s destination, they will be able to authorise the full use of the card in that foreign country.

2. Get travel insurance:

Travel insurance is very important if one is to travel out of Singapore. It will cushion the traveller from several sudden situations that may arise in the course of the vacation, such as sickness or plane delays. We never know what is going to happen during the trip. Many medical insurance covers will not pay if the policy holder gets sick while outside the country, and this is where the travel insurance will come in handy. The travel insurance will also cover the cost of lost luggage and cancelled trips. There are usually many options and types of travel insurance and it is generally affordable in Singapore.

3. Check VAT (value-added tax) refunds:

Most countries will refund foreigners the VAT amount on goods that they have purchased while on vacation in their country. Some travellers are not aware of this benefit, but it can help the traveller to save a substantial amount of cash as he leaves the foreign country after the vacation. The refunds make a huge impact if someone bought an expensive product such as a branded LV bag overseas. The documents necessary for this refund are basically receipts from the vendors and the passport of the traveller. The traveller will also be informed as to which purchases are eligible for VAT refunds.

4. Create a budget and stick to it:

It is very possible for one to overspend during a vacation, no matter how well he or she planned the itinerary. To avoid the likelihood of overspending, it is advisable for the traveller to create a budget for all the expected expenses of the vacation and stick to it. This will help the traveller to return from holiday without having incurred any unnecessary expenses.

5. Organise for the payment of bills:

There may be some bills that fall due during the vacation period such as the monthly phone bills, mortgage bills and utility bills. The traveller should ensure that he or she makes arrangements for them to be paid. The traveller can arrange for automatic payments to be made during the time when he or she is away. This will also help to prevent late payment penalties.



Apart from financial preparations, it is important that the traveller also makes some logistical preparations before going on vacation.




Some of these are mentioned below:

  • Use a guidebook or itinerary:

Getting a guidebook is definitely going to help during the trip. It highlights the best and most popular locations and help readers save time and money by not getting lost. Guidebooks usually provide useful information on where to get affordable meals and good accommodation. The guidebook can be in softcopy or hardcopy. With the growth of technology, there are many free online itineraries that are being shared by other travellers.

  • Do not pack bulky items:

The traveller should avoid packing bulky items that occupy plenty of space, especially bulky shoes. It is advisable to pack shoes that are light and suitable for all types of weather. The shoes should generally be suitable for multiple use so that only one or two pairs are needed for the full vacation. It is best to pack lesser and not fill up the entire luggage before going for the trip because one usually buys more food and gifts back.

  • Leave the house in order:

It is important for one to leave his or her house clean and well-organised before going on vacation. This will make coming back from the holiday more peaceful. It is generally more pleasant to come back to a clean house after a long holiday and make it much easier to unpack and get back into the normal routine.

  • Pack only necessities:

In order to limit the amount of items packed, the traveller should pick out only what is very necessary for the trip. Whatever can be bought at a reasonable price at the vacation destination should not be packed. It is much easier to have a great holiday when one travels with a minimum amount of luggage. It is also much easier to keep track of all the luggage when the items are fewer.

  • Confirm the weather at the holiday destination:

It is always wise to confirm the weather conditions at the holiday destination before travelling. Unlike Singapore, many other countries such as Japan have different seasons. Remember the pack the right clothing. If the summer conditions are extremely hot, then it will be important to carry enough sunscreen and other accessories for that kind of weather. Cooler or rainy weather should also be prepared for accordingly.


Going for a holiday usually burns a hole in one’s wallet. The traveller has to pay for accommodation, plane tickets, food expenses and more. It is not cheap even if one has a perfectly planned budget. Sometimes, extra funds may be needed for the vacation. In Singapore, several travellers have taken on the option of taking vacation loans to finance their vacation. This is to make the entire trip more enjoyable and worthwhile.



If you’re seriously considering taking a vacation loan, there are several things you will want to keep in mind.




1. You may want to combine the benefits of credit cards and vacation loans

Many credit cards come with benefits such as reward points and insurance. One good example would be KrisFlyer cards. However, credit card interest rates are often much higher than those you would be charged if you took a vacation loan. You may therefore want to combine the benefits of both products for your vacation.

Consider using your credit card to book your flight, for example, in order to take advantage of reward points for better rates. You can use your vacation loan to repay this credit card debt and pay for other vacation expenses.

2. Borrow only what you need

It can be tempting to borrow a large sum of money to cover other expenses aside from your vacation costs. However, it’s important to remember that the loan is a debt that has to be repaid.

Sit down and calculate all your vacation expenses. Decide how much of this you want covered by your vacation loan and how much you can pay for out of your own pocket. Borrow only what you need. You don’t want to have a debt hanging over your head long after you’ve returned from your dream vacation.

3. Borrow only what you can repay

It’s also important to ensure that you can actually afford to repay the loan. You should be confident in your cash flow and ensure that your income will cover the monthly instalments.

Be sure to consider the interest rate on the loan when determining whether you can afford the loan. You should also consider your financial goals. Repaying the loan shouldn’t interfere with them. A great vacation isn’t more important than the education of your children.

4. Read the fine print

It’s easy to be swayed by all the marketing. Many consumers are quick to sign up for loans that have seemingly low interest rates and great terms. However, the marketers won’t tell you the full story.

Before you sign any document, be sure to read the fine print. Take the time to understand the terms and conditions of the loan. Understand the fees, charges and requirements that come with the loan before you agree to anything.

5. Make good use of the money

It’s not uncommon for people to take out loans to finance their vacations and use them for something else. If you’re taking out a loan, be sure to make the most of it. Use it to cover the essential costs while on holiday. Ensure that you travel within your means and are able to repay the loan as soon as possible.


In conclusion, it is important for a traveller to prepare properly both financially and logistically for a vacation. Proper planning ensures that the vacation is successful and the losses are minimal. Most importantly, one should enjoy themselves at their well-deserved vacation! If you have any questions about vacation loans or require any form of financial help, feel free to speak to us. Credit Matters have friendly consultants here to help you.