I’ve been reading some things in the blogosphere lately that have me thinking about my previous post in which I share my plan to take an international trip next year once out of credit card debt, but while still in student loan debt.
Trent at The Simple Dollar blog recently posted about the importance of celebrating achievements in a smart way, and not in a destructive way. Yes, as usual, he makes some good points. It is wise to be deliberate in one’s decision making and to celebrate achievements in ways that do not sabotage one’s goals.
There are a lot of opinions on whether or not travel while in debt is acceptable. At the most basic level, there are two opposing camps.
On one side of the argument are those who are against someone taking a trip while in debt regardless of circumstance. The motto: “Stay the course. No detours. No distractions. Go! Go! Go!”
Anti-Travel (while in debt)
- (1) It’s all about the money
Numbers tell the story. Every penny thrown at debt is a penny closer to freedom, in the form of lower principal and less interest paid. Creditors are entitled to every penny you make until they get their money back. Not taking a trip means getting out of debt sooner.
If I take this trip, it will delay my student loan payoff by two months. To this camp, it is better to pay off all the debt first, then take the trips. If I throw everything at the student loans (minus bare minimum 401k contributions), I could pay them off in 4-5 years. I would be 45 before I could travel. If I contribute to retirement more aggressively, it would take me 10 years to get out of student loan debt. I would be 50 and graying before I could travel. ‘Oh well’, say the anti-travel people, ‘Them’s the breaks. You shouldn’t have gotten into so much debt’. Believe me, had I known better back in those years, I would not have!
- (2) It’s all about discipline
You must deny yourselves your wants, until your debts are repaid. It is the responsible thing to do. Taking international trips while in debt means that you aren’t really committed to debt repayment. Such trips are wasteful indulgences that will lead to a cascade of financial belt loosening in the future.
These are good arguments.
In the other camp however are those who support more flexibility in high and long term debt payoff.
Motto: “Pace yourself. Don’t miss the important stuff.”
Pro-Travel (while in debt)
- (1) It’s all about balance
If you have deep debt and are facing several years of repayment, 5, 10, 15+ years, these people say that you need to pace yourself. You need to be aggressive about paying off debt, but no so consumed by it that you risk burnout.
If you are no longer quite so young, say over 35 or over 40, you need to look at your projected length of debt repayment and make sure that you don’t let life pass you by while you are in repayment mode. That would be the equivalent of living in debtor’s prison. It is ok to pick one or two important experiences that you want to have in your life and make sure that there is room for them throughout your repayment plan.
About this trip:
This is an organized trip that I had an opportunity to go on about 4 years ago. Because of certain conflicts (long story), I chose not to go. I have seriously regretted that decision ever since. This is a destination I’ve been wanting to visit for the past 8+ years. I always told myself that if I ever had another chance to go, I would jump on it and not let time pass me by. As it turns out, I may be eligible again to do this trip. Of course, it would be saved and paid for in advance with cash. NO ADDED DEBT.
- (2) It’s all about priorities
Red Debted Stepchild has written a fun, clever and witty argument for why she shouldn’t take heat for spending money on her #1 want – dining out. In short, she writes that as Americans, we already spend money on wants. Very few things are truly needs. Having our own house/apartment (vs. having roommates) is a want. Having a car, children, pets, are all wants, not needs. Having them are choices. They are not required for us to live our lives.
Some people don’t want those things (or are willing to give them up for a significant period of time) and instead choose to direct their money to other wants. Assuming that the writer is financially responsible overall (actively paying down debt), just because her prioritized wants are different than someone else’s, doesn’t give anyone the right to judge where she allocates every penny of her money. Her burrito analogy is gold.
So What is the Verdict?
I am not entirely decided, although I am leaning towards going on the trip. Getting out of debt is a priority for me, but I can’t let it become my only reason for living. We can always recover lost money, but we can’t recover lost time.
Andrea @SoOverThis faced a somewhat similar dilemma. At the the time she felt shamed by the personal finance blogosphere into reconsidering her decision to take a business trip. Unfortunately, I don’t know what she ultimately decided, but commenters encouraged her to go because she had a responsible plan.
I have several months to think things over before making any decisions. In the meantime, I’m staying focused on making my payments and looking for more ways to lower my living expenses.
What do you think? Which camp are you in?
“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW)