Escape the rain and get globe-trotting with a travel loan

By Sara Borman · · 2 min read
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excited woman tourist with personal loan ready to travel

Aussies spent more than 600 times more on travel between January and May of 2022 than they did in the same period last year, so to say travel enthusiasm is at a high seems like an understatement.

NAB’s banking insights show that travel was a top priority for Australians in 2022, and shows no signs of slowing despite the rising cost of living.

NAB Everyday Banking Executive, Paul Riley, said “We expect to see spending on overseas travel continue with … European summer now underway.” 

Findings from Commonwealth Bank echo this, showing that more than half of respondents were planning on travelling in 2022. CBA’s Kate Crous says that travel spending has people excited but anxious. “We’re seeing that while people feel excited about travelling again, one in two Aussies are worried about the cost of travelling.”

Why would I take out a travel loan?

A travel loan operates the same as any other personal loan. If you need some extra cash for travel, this can be an ideal set-up as it allows you to travel freely with a set amount of money. 

Work out the amount of money you need and amount you can afford in repayments to work out the term of loan you need (psst - our personal loan calculator makes this easy). Remember to factor in the interest rate! Make sure to opt for a loan with a rate you can afford to pay back. 

An unsecured loan will also mean that the money you spend on travel is not held against any of your possessions, like a car or expensive jewellery. Taking out a secured loan for travel expenses might score you a better rate, but remember: if you aren’t making your repayments, you might find your valuables being repossessed. 

A travel loan might not always be the best option for funding your trip. These personal loans tend to start at around $4,000, which makes them a less appropriate option for smaller amounts of money. They also involve a credit check, so you might be in a sticky spot if your credit history is less than stellar. 

If a travel loan isn’t for you, you might want to look at options for travel credit cards.

What does a travel loan cover?

Your travel loan can cover everything, including:

  • Flights
  • Accommodation
  • Food
  • Shopping

Once the money from a personal loan is in your hands, it is yours to spend as you see fit - as long as you’re making your repayments.

Where can I go with a travel loan?

The sky isn’t the limit with a travel loan - it’s just the starting point!

Advice from Smartraveller has been updated to “Exercise normal safety precautions” (that’s a green light if we’ve ever seen one!) for countries from South Korea to Sweden. New Zealand was the biggest destination for short-term trips arriving home to Australia in May, and a trip back across the ditch sounds dreamy right about now.

Getting ready to jet? Prepare your wallet with our guide to travel budgeting and learn to pack like a professional.

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Last updated 30 October 2024 Important disclosures and comparison rate warning*
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