How to have a great holiday on a budget

Dubai - The trick to being able to afford your ideal holiday is ensuring you get the best value for your money.

What's a holiday without loads of fun, right? The only hitch is that fun sometimes comes with a hefty price tag.
The trick to being able to afford your ideal holiday is ensuring you get the best value for your money. When it comes to financing your trip, you can combine several options, such as using up some of your savings while exploring the advantages of financing and prudent use of credit cards or multi-currency cards. Let's see how.
 Plan the predictable
Needless to say, the key to any big-ticket expense is sound planning. The holiday calendar tends to be predictable, especially if you have children. So, there's no reason why you shouldn't have started a holiday fund six to 12 months in advance. But in case you didn't manage to put any money aside, a bit of smart planning is all it takes to ensure a stress-free holiday.
First, deal with factors that are under your control, like the dates, destination and budget. Figure out how much you're ready to spend before choosing the location, whether an expensive Western locale or an affordable exotic Asian island. Resist the temptation to get sucked into competition with peers when it comes to luxury vacations.
Booking flight tickets and accommodation as early as possible is the most sensible way to get the best rates. If you're lucky, you may even grab one of those 'early bird' bargains. On the other hand, many hotels and airlines do have attractive last-minute offers, however, this alternative can't be relied on and is best avoided if you're travelling with a large entourage.
Bank on a bank
Once you're done planning your destination and dates, start working on allocating money for the trip. While it's recommended not to go overboard with your expenses, there's an argument for not spending all your savings at one go. Instead, consult your financial advisor and opt for easy financing options, especially those that come with multiple travel perks.
You should be able to choose from a variety of bank offers, from personal finance at attractive rates to instant 'easy cash' for those small expenses through your credit cards. These financing schemes allow you to pay in flexible installments or in a lump sum without the hassle of fixed installments.
In addition, many financial institutions have tied up with holiday package providers, which offer a wide range of deals to suit any budget. Through these arrangements, you can get up to 30 per cent off on travel packages and car rentals including complimentary car insurance if you have a premium credit card. You can also benefit from exclusive deals at participating hotels and resorts around the world, including complimentary room upgrades and free nights - all you need to do is book your trip using your premium cards.
In fact, these bank-travel company tie-ups are ideal for those who dislike the nitty-gritty of planning a holiday and are happy to let holiday experts take care of it all. They can zero in on travel packages with equal payment plans at 0 per cent profit rate up to 12 months.
The advantage of booking a holiday through a card may include perks such as complimentary airport transfers, meet and greet services for premium customers and airport lounge access across the globe.
Always check with your bank if it has ongoing promotions for international spends - for instance, additional cashback or double reward points. This will add value to using your credit card outside the UAE.
Credit cards are the most convenient tools when it comes to travel, as you don't have to worry about carrying cash. However, you should exercise caution while using them abroad. Generally, it's better to pay in the currency of the country where you are vacationing. Paying in dirhams while travelling abroad tends to incur higher processing fees and unfavourable conversion rates that can make transactions more expensive.
It's also possible to purchase a multi-currency prepaid card and load it up with the currency, or even multiple currencies, used in the destination(s) of your choice.
Cool caution
Once you have finalised your holiday budget and decided whether to use your savings or opt for financing, and how much to depend on your credit card, it's time to take some precautions.
To ensure peace of mind while travelling, don't forget to take out travel insurance, as anything may happen when you're on the go. The good news is that many credit cards offer complimentary standard cover in case of unforeseen circumstances, such as loss of baggage, flight delays or medical emergencies, provided you purchase the tickets using the card.
Try to keep an account of your expenses while on holiday. Once you return, thoroughly review of your bills and credit card statements to understand what you can cut back on next time.
And, most importantly, deal with your vacation credit card bills as soon as possible. After all, you only want happy memories from your holiday.
The writer is head of assets for retail banking at Noor Bank. Views expressed are his own and do not reflect the newspaper's policy.