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4 ways to save now for airfare for a summer trip

Erica Sandberg

February 23, 2016

Q Hey Erica,

I’m planning a trip to Ireland this summer for my sister’s wedding. Tickets are really expensive — about $1,000 for each ticket.  I’m going with my husband, so it will be $2,000. I can put the tickets on my credit card (my husband has no credit), but then I would have no credit left. Should I open a new card? Any suggestions would be super helpful.
— Maeve

A Dear Maeve,

I can’t have you missing out on your sister’s big day! Yes, airfare can cost a fortune, especially in the summer when many tourists are visiting the Emerald Isle. However, you have time to save for the cost. Here are four money- and credit-smart ways to get you where you want to go.

1. Amass cash. Collect enough of your own funds so you don’t have to borrow to pay for the flights. Presuming the wedding falls at the start of summer, you have three to four months before the June wedding.erica-box4

If you don’t have any money saved at this point, you can reduce expenses and increase your income so you have a travel fund. Create a pared-down budget in which you spend only what is absolutely necessary until you’re set to leave. If you and your husband can work extra or get part-time jobs on the weekends or at night, do it. Sell extraneous stuff online or hold a garage sale.

When you’ve collected the amount you need for the trip, charge the tickets so you’ll accumulate any rewards points your account may offer. Repay the balance before the due date so your credit score isn’t affected.

2. Use your current card. As you mentioned, you also can buy the tickets today and then pay off the debt before you leave. You don’t mention owing anything on your card, so in that case you would be looking at repaying $2,000 pretty quickly. Presuming you have four months before your flight and your card has a 21 percent APR, the payments would be $522 a month and the total fees would be about $89.

I do suggest trying to call your card issuer first to ask for a credit limit increase so your credit rating isn’t damaged. Credit utilization is a major credit scoring factor, and you want a lot of room between the amount you owe and the amount you can charge. Your credit rating will bounce back when you pay down the debt, but with a credit limit increase,  you can offset temporary damage. The odds of getting approved for a credit limit increase are good if you’ve had the card a while and have never been late on payments.

3. Open a new travel rewards card. If your credit rating is excellent (750 and above) and your income is steady and high, you may be able to qualify for a credit card that offers a lot of travel rewards.

Check out the most recent  travel and airline frequent flier card offers. You’ll see that some issuers give a one-time bonus of 40,000 points if you spend $3,000 in the first three months that the card is active. Applying for a general rewards card or a cash-back card would translate into about $400 for travel, thus decreasing the price of the tickets substantially. Oh, and many travel cards  come with other perks you may find useful, such as a free checked bag or no foreign transaction fees on purchases. You may even qualify for special sign-up bonuses (think extra miles or points) when you use CreditCardGuide’s CardMatch tool.

4. Consider a layaway plan. The way consumers can pay for stuff is constantly evolving. Layaway plans aren’t just for appliances, toys and clothes anymore, but can be used to spread the cost of flights out over time.

With companies such as Airfordable, you can book expensive flights by making a small deposit, then making monthly or biweekly payments so you’ve paid off your tickets prior to departure. The installment plan isn’t listed on your credit report, which would keep your rating pristine, nor would you tie up your credit card’s limit. Be aware, though, that the down payment is nonrefundable, and the company adds in a 20 percent service fee that is spread out in each of the installment payments.

Which method will you choose to pay for your airline tickets? That’s up to you, but you’ll make it to your sister’s wedding. After all, as the Irish saying goes: Your feet will bring you where your heart is.

Got a question for Erica? Send her an email.

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