7 Ways Using Credit Can Help You Enjoy a Cheaper, Safer Summer Vacation

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Summer travel season has arrived! Whether you’re going to the beach, the lake, the mountains, or “The Happiest Place on Earth” (at least from the kids’ perspective), summer vacation can be expensive. It also can put you at risk for theft — both of your personal belongings and your identity.

According to Experian, the average per-person cost of a vacation is $2,275, and half of this expense is put on a credit card. Planning ahead, setting a budget, and saving money in advance are essential for a debt-free vacation. Even after putting in the time and effort to start a vacation fund at the bank, using credit can be a smart financial choice. Here are seven ways using credit as a financial tool during your summer travel can help you have a safer, less-expensive vacation without taking on debt.

1. Convenience

Figuring out foreign currency can be like Harry Potter counting Muggle money. Using a credit card can eliminate uncomfortable stares from the locals, who you know are thinking, Yup, they’re tourists, while you and yours hold up the line deciding whether the gold coin with the lady on it or the silver coin with the man is the right change. A credit card can also automate the calculation of exchange rates. Look for cards that don’t charge a foreign transaction fee. Finally, credit cards hold up much better than cash when you drop your wallet in the pool.

2. Travel insurance

Some credit card agreements provide travel insurance when you book flights or hotels. You’ll be glad you didn’t reserve those nonrefundable tickets with cash when the hurricane blows through two weeks before departure and takes your hotel with it.

3. Purchase discounts

Branded credit cards may offer discounts for purchases on the resort property or in stores and restaurants in the area. The right logo or cute cartoon character on the card can leave you with a little extra cash in the bank back home.

4. Rewards and incentives

Airline miles, hotel points, and cash back can add up quickly on a cross-country road trip or overseas vacation. Using a credit card could put a bit of money back in your savings account, get you a free room for a night, or earn a seat upgrade on a long overnight flight.

5. Identity theft protection

Your identity may be your most valuable possession. Using a credit card for vacation purchases will protect you when your identity is compromised. Because losses due to fraud are limited to $50, if your identity is stolen while on the road, you won’t lose any cash. In most cases, even the $50 is waived by the credit card company.

6. Theft deterrence

Want to put a bullseye on your back? Pull out a big wad of cash in a crowded vacation spot. Flashing loads of lucre can make you a prime target for thieves and pickpockets. Eliminate bulging pockets and use a credit card instead of cash. If you do have your pocket picked, simply call the credit card company to have the account blocked and a replacement card delivered to you.

7. Expense tracking

Using a single credit card for all your vacation purchases can be a good financial management tool. Designating a single card will give you a complete record of your expenses when you get home — in the form of your monthly statement.

You might also consider applying for a new card expressly for your summer vacation. That makes expense tracking even easier — any spending on the card is automatically "vacation spending." If you choose your vacation card carefully, you may be able to boost your rewards and savings, too. Before applying, check your Experian credit report and score. Knowing what’s in the report will ensure there aren’t any surprises when you apply.

Of course, you can’t just charge it and forget it. You still have to monitor your spending along the way, stick to your budget, and use your vacation savings to pay the balance in full when you get home. But if you use credit wisely, you may be able to leave a bit in the account to use next year.

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