Put it on Layaway: Some hotels are introducing layaway programs to let guests pay off their bill even before they arrive. Since March 1, guests at Apple Core Hotels in New York City have had the opportunity to use layaway to finance a future hotel stay at any of the group's five properties, including La Quinta, Red Roof Inn, Comfort Inn, the Hotel at Times Square and Ramada Inn.
"Guests can start with a down payment of as little as $20," explains Vijay Dandapani, the President and COO of Apple Core Hotels. "Then they have the opportunity to build up the pre-payment in the time leading up to their trip."
For travelers, it's hard to argue with the combination of reasonable prices, flexible payments, and risk-free booking that comes with the Apple Core layaway plan. "There's a misconception that New York City is expensive," says Dandapani, pointing out that the rack rate for Apple Core Hotels is between $139 and $159 a night. "We don't impose a timeline with our layaway plan," he says. "Guests can pay little by little, or they can pay off the balance all at once when they check out of the hotel."
What if a guest changes her mind and cancels? "She gets her money back," says Dandapani. Best of all, opting for Apple Core's layaway plan guarantees that you nail the best price. "If the rates go up, your reservation is locked in at the lower rate," explains Dandapani. "And if the rate goes down after you book, we'll refund the difference."
The way Dandapani sees it, pay-before-you-go plans are an option whose time has come in the hotel industry. "We've seen that there's a huge hesitation on the part of consumers to spend money and build up debt," he says. "Our layaway plan lets our guests avoid a big charge on their credit card at the end of their stay. Frankly, I'm surprised more hotels aren't trying it."
Play the Percentage Game: Need another good reason to save up or pay off as much as you can before you go? Maxing out your credit cards on vacation can hurt your credit score big time, says Ray of CreditCards.com. "Most experts recommend that your credit card debt should not go above 30 percent of your total credit limit." Ray suggests spreading out your expenses across multiple cards, so you stay below 30 percent of the limit on each individual card as well as on your cumulative credit card limit.
Don't Forget to Count Your Paycheck: Now for some good news: You probably don't need to save up 100 percent of your vacation cost anyway, says Bodnar of Kiplinger's magazine. Any traveler who receives paid vacation days from and employer can finance a portion of the vacation with a current paycheck.
"Whatever you would have spent at home for food and recreation during the same period can be put toward your vacation budget," explains Bodnar. So if your family of four typically spends $200 on groceries and $70 on recreation and entertainment in a week, that's $270 you won't have to save for a weeklong getaway.
Do you have more information about this topic? If so, please click here to contact the editors of ABC News.
