My best friend of 13 years is from Nepal originally. She is getting married this summer in Nepal and has invited me and my husband to attend the celebration.
I very much want to be there for my best friend’s wedding, and I also want so much to experience her home country. The problem is the cost. For plane tickets alone, it will cost the two of us about $5,000. The entire trip will cost several thousands more. We have some savings (about three months’ worth), and we still have a bit of time to save. We try to follow the advice of keeping at least a three-month emergency fund, so we wouldn’t spend that money. Most likely, we’d pay for part of the trip with money we save over the next few months. But we’d probably charge the $5,000 for plane tickets to a credit card and then spend the next several months paying it off.
We have no other debt beyond our mortgage (2.89%, financed in 2021) and one car loan with around $4,000 left. We don’t make loads of money, but our jobs (I’m in education, he works in government) are stable. We’re both in our early 30s with no kids. Should we go to Nepal and go into credit card debt?
— Best Friend of the Bride
Dear Best Friend,
Which do you think you’re more likely to regret in 50 or 60 years: A.) Paying a few months’ worth of credit card interest, or B.) Not going to your best friend’s wedding in Nepal? I think “B” is the correct answer.
Often in personal finance, we have a knee-jerk reaction against making any purchase with a credit card if you can’t pay it off at month’s end unless it’s a dire emergency. And I’m sure some readers will disagree with me here. But a credit card can be a smart tool in your financial arsenal when you’re looking at a major expense.
I suspect that more people get in trouble from spending $15 here and $20 there on their credit card than they do from a single major purchase. That’s because the $15 and $20 purchases are often mindless. Meanwhile, you’ve probably spent months mulling over whether you can afford this trip and hatching a plan to pay off your credit cards afterward.
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Had you told me that you were hoping to take your dream vacation to Nepal, I would have suggested that you keep saving because Nepal will be there next year. But your best friend’s wedding obviously won’t be happening next year, and this will be both the trip of a lifetime and an opportunity to celebrate your best friend.
Likewise, if you were buried in credit card debt or worked for a company that just completed a third round of layoffs, I would have (sadly) told you that financial security comes before amazing experiences.
But both you and your husband have stable jobs. You have some emergency savings. You have a few decades left until retirement. And it sounds like you manage debt responsibly.
Before you book this trip, though, you need to make a plan of attack for your credit card balance. Set a line item in your budget for credit card payments, and make the payments as aggressive as you can afford. Look for other discretionary purchases you can scale back on. For example, if you frequently dine out or attend concerts, temporarily nixing these from your budget in order to attend the wedding seems like a worthy trade-off.
Also, if you qualified for a 2.89% mortgage, you probably have strong credit. You may be able to qualify for a credit card with a temporary 0% interest rate. Many card issuers offer no-interest introductory periods of 15 to 18 months, so you’d likely be able to pay off your balance before interest starts to accrue.
Credit card debt can become an albatross, especially when credit is financing a lifestyle you can’t afford. But if you use a credit card for an occasional big expense, then pay it off over a few months, you can avoid getting into trouble or racking up huge interest charges.
People often regret their credit card debt when they realize they acquired it by ordering DoorDash twice a day or making one-click purchases on Amazon. But I don’t think you’ll regret the temporary credit card debt you’ll have from experiencing your best friend’s wedding and culture.
Robin Hartill is a certified financial planner and a senior writer at Codetic. Send your tricky money questions to [email protected].