So, you want to go to Ireland?  Want to know how much a trip like ours cost?

Last week, I shared all the numbers in this blog post.

This week, I want to do a little math for you.

We save for our trips by setting aside a certain amount of money per month that is automatically drafted to our travel bucket savings account.

Anytime we get “extra” bonus money I add it to that account because right now, travel is our highest priority.  All of our other hierarchies are in good shape – we didn’t start here and we didn’t get her overnight, but here we are, living the life.

I’m kidding.  In actuality, it’s been twenty years of living and working and saving and trying to get ahead and some days we were like what the hell are we doing wrong?

Maybe we should live the life we want to live today instead of waiting for tomorrow.

Life is short.

And while I DO want to live for today and I DON’T want to put my life on hold until someday, we hold strong to we want to pay as we go, even if it means sacrificing in the short term and even if it means we go on trips less frequently.

That said – put a plan in action!  I do feel like we waited entirely too long, and settled far too frequently – so I think there is a middle ground here.

Work hard, have a plan, be ambitious in your earning potential.  Make a dream list – and then make a plan to put it into action.  Let that plan inspire you to reach farther – don’t settle for someday.

Let me show you the math:

Airfare $1,052.52

Minimum Payment: $25

Interest Rate:18.74%

IrelandAirfare
Site Credit: Credit Karma Credit Card Repayment Calculator

But, wait!  There’s more.  See this blog post for the full breakdown.

Total $5,835.82

Minimum Payment: $94

Interest Rate:18.74%

FullTrip
Credit Karma Credit Card Repayment Calculator

Full Disclosure: I don’t know what the actual minimum payment on this amount would be because we paid our balances in full from our travel account as soon as they came in.  I don’t play around – I’d slip up and get hit with the 29.99% interest rate and never , ever forgive myself. 

I looked up the minimum payment calculation and it’s clear as mud.

MinimumPayment Due
Citi Minimum Payment Due Calculation

At first, I thought, I can’t post this, I don’t have all the facts.  But then I realized, most of us consumers don’t understand all of the credit card details, so let’s just do a best-guess analysis on Credit Karma and you can decide for yourself if it’s a game you want to play.

Okay.  So let’s go back to that example above for the total.

Minimum Payment Intrest
Credit Karma Credit Card Repayment Calculator

Look at that interest!  Now, you didn’t pay $5,835.82 for the trip, you paid $21,244.

Shut the French door!  How did that happen?!

18.74% of $5,835.82 is $1,093.64.  So maybe you thought it would cost in the ball park of $6,929.46.

$5,835.82 is $1,093.64 = $6,929.46

Not a game I want to play.

But, no.

Sadly, you could have taken this trip nearly four times for the price you paid.

The interest compounds daily and the majority of the payment goes to interest not principal.

Not to mention that it’s nearly 19 years later.  Talk about time flies.

Earn interest, Don’t Pay interest.

Wouldn’t you rather do that?

Check back with me next week for the final math calculation.

Sláinte,

Rachelle

ACTIONABLE STEP:  Head over to Credit Karma and play around with your own numbers.  If you don’t owe on credit cards – GREAT!  But still, go over and plug in some numbers.  That way if you ever get tempted, you’ll know what kind of fire you are playing with.  If you already have credit card debt – don’t beat yourself up!  Just plug in your numbers and make a plan!  You got this, and I’m here to help.

Rachelle Magadan