That’s the term used to describe arriving back from a vacation bogged down by credit card debt you can’t afford to pay off before interest charges apply.
Research by comparison site Finder shows Australians spend an average of about $2,000 on their credit cards while on holiday. And around 2 million of us Aussie travellers will hit the tarmac at their home airport knowing they face an uphill battle to clear their credit card slate.
In fact, of those holidaymakers who face debt-lag, more than one in four will still be paying off their holiday spending six months later.
It all highlights the need to be cautious about overspending if you’re heading somewhere special over the summer.
We have seen home loan interest rates rise in the last few weeks, and credit card rates, which are already high, could follow. Adding debt-lag to the mix could leave you battling unnecessary financial stress in 2016.
One way to keep your holiday money under control is to follow a vacation budget. Work out a daily spending allowance – and stick to it. Prepaying things like all flights, accommodation and tours before you head off gives you time to shop around, compare value and avoid paying inflated tourist prices.
It also helps to avoid some of the pitfalls where tourists typically get slugged by unexpected costs.
As a guide, Finder found the travel rip-offs most often experienced by Australians include overseas credit card and ATM fees, mobile phone roaming charges, and being coerced into buying something they don’t really want, like souvenirs.
Despite these potential pitfalls, heading overseas or even holidaying domestically, is always an amazing experience. More so if you avoid the trap of thinking “I’ll worry about how I’ll pay for it all when I get home”.
Great memories, fantastic experiences and a broader outlook are wonderful things to bring home from a well-deserved vacation. A mountain of high interest debt is not. It’s the sort of excess baggage that can be avoided with some simple planning.
For more ideas on how to save for a vacation, trim expenses and get ahead with holiday-induced debt, take a look at the government’s MoneySmart website.
Paul Clitheroe is a founding director of financial planning firm ipac, Chairman of the Australian Government Financial Literacy Board and chief commentator for Money Magazine.
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