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Finance your vacation

When you're ready to head out on vacation, use these tips to help make your trip more affordable.


Need financing for a vacation?

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  • Borrow $200 - $35,000
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When you’re ready to relax on an exotic beach or hike a distant mountain, your finances don’t have to hold you back. Here’s how to finance a vacation.

There are numerous lenders across Canada that offer personal loans designed to pay for vacations. But be careful — you might be better off saving for your next big adventure rather than taking out a loan and paying more in the form of fees and interest.

What is vacation financing?

Vacation financing is generally the combination of your savings, a loan and a credit card. If you don’t have the savings built up and don’t want to spend a lot of money using a credit card, then a personal loan will likely be a good option to book your next trip. Depending on the type of trip you book, you may only have to pay a deposit at first. This will give you more time to come up with the rest of the money.

The type of vacation financing you’ll qualify for will depend on your credit score, your income and the amount you need to borrow.

How can I finance my vacation?

There are a few different financing options you can consider:

What personal loan lenders can fund my next trip?

Name Product Interest Rate Loan Amount Loan Term Fees Credit Score Link
LoanConnect Personal Loan
Secured from 1.90%, Unsecured from 9.90%-46.96%
$500 - $50,000
3 - 120 months
No application or origination fees
Min. credit score: 300
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An online broker who helps educate clients towards better finances. Get pre-approved by different lenders for unsecured or secured loans in 5 minutes with any credit score.
Spring Financial Personal Loan
17.99% - 46.96%
$500 - $15,000
9 - 48 months
Min. credit score: 400
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An online lender offering unsecured personal loans and credit builder loans. Those filing for bankruptcy or a consumer proposal can also apply. If you're not eligible for an unsecured loan, you may be offered a loan to help rebuild your credit.
Loans Canada Personal Loan
Secured from 2.00%, Unsecured from 8.00% to 46.96%
$300 - $50,000
3 - 60 months
No application or origination fees
Min. credit score: 300
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An online broker with the largest lender network in Canada. Get matched for free with lenders offering both unsecured and secured loans through one quick application regardless of your financial situation.
SkyCap Financial Personal Loan
12.99% - 39.99%
$500 - $10,000
9 - 36 months
Min. credit score: 550
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An online lender offering unsecured personal loans to borrowers with a wide range of credit scores. Apply in less than 5 minutes and if approved, receive financing in as little as 24 hours.
Mogo Personal Loan
5.90% - 46.96%
$200 - $35,000
6 - 60 months
NSF fee - $20 - $50
Min. credit score: 540
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More Info
An online lender who aims for a hassle-free process through same-day unsecured loan approval and funding. Get a loan fast and track your credit score for free.
Loan Away Personal Loan
19.90% - 45.90%
$1,000 - $5,000
6 - 36 months
Min. credit score: 300
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More Info
A lender that approves unsecured loans in as little as 20 minutes. Get affordable monthly repayments with any credit score.
Fairstone Personal Loan (Unsecured)
26.99% - 39.99%
$500 - $20,000
6 - 60 months
Min. credit score: 560
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An online lender with a team dedicated to professional service. Get a quote for an unsecured loan without impacting your credit score. Receive funds within as little as 24 hours. No prepayment fees.
Fairstone Personal Loan (Secured)
19.99% - 23.99%
$5,000 - $50,000
36 - 120 months
Varies by province
Min. credit score: 560
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More Info
Use your home equity to get a secured loan up to $50,000 with flexible repayment options and a long loan term. Get a quote without impacting your credit score.

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Representative example: The Singh family go on vacation

The Singh family are tired of the cold Canadian winter and have decided it’s time to head on a family vacation. With six family members in total, their all-inclusive vacation package to Sayulita, Mexico will total $1,500.00 each – for a total of $9,000.00! With savings of $7,000.00, the family will need to borrow $2,000.00. They know borrowing money for a vacation isn’t a great idea, but the family are expecting to sell their extra car soon, which will help pay back the loan. With a good credit rating of 700, the family are approved for a personal loan from an online provider.

Cost of vacation$9,000.00
Loan typePersonal loan
Loan amount$2,000.00
Interest rate7.00%
Loan term6 months
Additional feesOrigination fee of 3.00% ($60.00)
Monthly payment $340.17
Total loan cost$2,101.03

*The information in this example, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.

7 tips for making your next vacation more affordable

  1. Look for online promotions. Throughout the year, travel agents and online travel sites will have vacation sales. Sign up for email alerts and get notified when a trip you’re interested in goes on sale.
  2. Crowdfund your trip. Set up a campaign on a crowdfunding site during the holiday season, around your birthday or any special event and ask for donations instead of gifts.
  3. Put money into a high-interest savings account. Savings accounts are a quick way to save up with minimal effort. If you deposit the equivalent of $2 a day, you’ll have $730 after a year — plus interest. It might not fully pay for a yearly vacation, but it can help cover costs and act as an emergency fund if you need to make an unexpected trip.
  4. Use an online piggy bank. Online piggy banks are similar to savings accounts, but they’re often less work. You set a goal and the amount you want to contribute to your account then forget about it. By the end of the year, you could use the money to fund at least part of your vacation.
  5. Have a budget. While you’re busy putting away money into your savings, take the time to create a travel budget. Money for accommodation, food, tours and entrance fees should all be added on top of transportation costs like flights and car rentals.
  6. Get a credit card with travel rewards. There are a number of credit cards with travel rewards for you to choose from. Use it to pay for your everyday expenses, pay your bill early to avoid interest charges and build up travel rewards points that you can use toward your trip.
  7. Apply for a study abroad grant. Enrolling in a program overseas is a great way to travel and really get to understand a foreign country. This is a great option for students looking to travel, but unable to build savings or qualify for a loan or credit card.

Should I take out a loan to go on vacation?

Probably not. Most financial advisors are against using a loan of any type — including credit cards — to pay for a vacation. Vacations are a luxury, and going into debt to pay for one may not be a wise decision. You’ll be stuck with monthly payments, and at the end of the day, you’ll pay hundreds or even thousands of dollars more in interest than you would have if you’d saved for your vacation instead.

However, if you must borrow, financing your vacation with a personal loan is likely wiser than using a credit card. Personal loans offer fixed payments, relatively low interest rates and set terms. When you borrow, you’ll know exactly how much that vacation will cost you for years to come.

4 ways to pay for a cruise

As cruises continue to increase in popularity, more people are looking to break the cost down. You have options when it comes to lowering the payments on your cruise to make it an affordable vacation.
  • Cruise layaway plans. Some cruise companies offer layaway plans that allow you to put down a deposit months in advance and then pay in increments.
  • Credit cards. Possibly the easiest way to pay for a large purchase, a credit card with a low interest rate can get that cruise booked and you can focus on paying back the money with a low rate.
  • Book in advance. Cruise companies that don’t offer layaway programs will still allow you to book in advance. This will save you money, and you’ll have more time to pay for your cruise.
  • Go through a travel agency. Some travel agencies will offer a cruise-now-pay-later program that allows you to finance your vacation before you take it and pay for it once you get home.

Watch out for these mistakes when financing a vacation

Taking out a personal loan comes with risks. Be aware of the following:

  • Unaffordable monthly payments. If you think you won’t be able to pay back your loan, don’t take one out in the first place. Missed payments can have a negative affect on your credit score, and that can make it much harder to borrow in the future. Plus, the loan cost will be excruciatingly high once you factor in late repayment fees.
  • Skimming your loan contract. Never skim over the terms and conditions of a loan contract. Your loan contract will tell you exactly what you’ll be spending and what happens if you default — important information when you’re borrowing a large chunk of money.
  • Overspending on your credit card. Credit card debt comes with a high interest rate and rigid fees. If you borrow too much, you could damage your credit utilization ratio and pay a ton of money in fees and interest.

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Bottom line

Finding the right vacation financing could be an important step in planning your next big trip. There are multiple ways to make a vacation more affordable, while staying on budget. Keep in mind that borrowing too much could make it more difficult to travel in the future. Always compare different lenders and loans and have a healthy amount of money saved to finance the majority of your vacation.

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