Should You Book a Vacation on a 0% APR Credit Card?

It may seem like a good solution -- but is it?

Now that summer is getting closer, many people are getting serious about firming up their vacation plans. If you're one of them, you may be thinking of charging your trip on a credit card with a 0% introductory APR. Doing so might seem like a good solution -- but you'll need to be careful when going this route.

Will you really pay off that balance on time?

Some 0% interest credit cards come with a longer introductory period of charging no interest -- say, 18 months or even longer. Others give you a year of no interest. 

It's easy to see why it could be tempting to book your trip using one of these cards. That way, you have time to pay off your balance without racking up interest that makes your vacation cost more.

The danger, though, is that eventually, the 0% interest period will come to an end. And if you don't have your balance paid off at that point, you could get stuck with a lot of interest on the sum you still owe. That's why, as a general rule, it's not a good idea to charge any expense on a credit card unless you already have the money to pay for it, or are certain you'll get the money shortly. 

Say you're looking at a $3,000 vacation, but you have that $3,000 already sitting in your savings account, earmarked for travel. In that case, there's little danger to charging your expenses on a credit card -- one with a 0% introductory APR or any other card, for that matter.

Similarly, let's say you're charging a $400 flight but you know your upcoming paycheck at the end of the month will more than cover that expense. That, too, is a pretty safe move. What you shouldn't do, however, is charge a $1,500 trip knowing you don't have the $1,500 in savings already, and being unsure as to whether your upcoming paychecks can cover that cost. 

There may be a better credit card to use

Some 0% introductory APR credit cards offer perks like cash back on purchases. But it pays to compare those rewards with the rewards another credit card might offer you.

Let's say you have the money saved up for a vacation already, and your primary motivation in using a credit card is to snag rewards. In that case, you may be better off booking your plans on a travel rewards credit card. Some travel cards come with money-saving perks like discounts on in-flight purchases and free checked baggage, so before you assume a 0% introductory APR card is the best way to go, look at other options.

All told, booking travel on a credit card is often a smart move. That way, you'll not only have a chance to reap rewards, but also, enjoy certain protections. But if your plan is to charge a trip you can't afford at the present on a 0% introductory APR credit card and hope for the best, you may want to rethink it -- before you end up with a pile of costly debt you can't easily pay off.