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Splurging on a summer vacation may not be on the horizon this year as many Americans are tied down with debt, according to a new survey conducted by Bankrate.

Consumer debt in the US hit $4 trillion earlier this year and on average, Americans hold an estimated $4,200 in said debt. Although economists believe that this number is manageable, the same Bankrate survey found that some Americans believe they will never pay off their debt — which is why many might be staying home this summer instead of taking a vacation that on average can cost $1,928 per person, or $4,580 for a family of four.

While paying off debt is always a smart decision, it doesn’t mean you have to spend your summer sitting in a dark room watching Netflix. You might not get to enjoy the annual family trip to Disney or a couples’ retreat to the Caribbean but there are plenty of other ways to enjoy the season while paying down your debt.

Here are a few summer vacation alternatives as well as the best credit cards (low interest, no annual fee) for working toward a zero balance.

(Photo via Getty Images)
Put summer vacation on hold, because it’s important to pay off debt first. (Photo via Getty Images)

Vacation Alternatives

Explore Your Hometown with a Staycation

It might seem corny, but a staycation is a fantastic way to enjoy summer on a shoestring budget. Staycations are cheap, fun and devoid of jet lag. With a little research you might be surprised by the variety of exciting activities in your own backyard.

Your city might have more to offer than you think. Image of The Gateway Arch in St. Louis (Image by JByard/Getty Images)
Your city might have more to offer than you think. Image of The Gateway Arch in St. Louis (Image by JByard/Getty Images)

The key to a successful staycation is trying something new. Do some research to discover new restaurants, bars, neighborhoods and activities in your area. Put a few dates on your summer calendar and begin to plan a list of activities that would excite you on any vacation: spending time outdoors, visiting museums and relaxing.

If a hotel stay is in the budget, you might luck out with cheaper options in your hometown than you’d find in a more popular tourist area. For example, in my hometown of St. Louis, there are multiple dates this summer that offer top hotels at under $200 (even $150) per night. And since you won’t have to worry about working around travel constraints, remember that sites like Hotel Tonight offer cheaper stays for those with flexible plans.

Helpful links:

Visit With Friends and Family

If you can handle a few nights staying in your parents’ spare bedroom or Aunt Deb’s basement, a family visit can be a great way to explore a different city, spend time with loved ones, and save money. (Just don’t arrive on their doorstep without contacting them first.) In addition to spending quality time together, friends and family are often the best concierges, showing off their hometowns with recommendations on local restaurants and other hot spots. Think of this as a great way to not only save money, but make your summer travel experience even more meaningful.

Complete A Project Around the House

Do-it-yourself summer projects can be enjoyable and rewarding (as long as you don’t get in over your head). Maybe you’ve always wanted to create the perfect backyard retreat or remodel a bedroom. Summer is a great time to take inventory around the house to see if there are any affordable DIY projects that won’t hinder your ability to pay down debt. Sites like Pinterest provide (free) inspiration, and you won’t have to worry about labor costs. Time spent planting that new garden is certainly more relaxing than fighting crowds during peak travel months.

DIY projects are often less expensive than vacations and can be fun and rewarding.
DIY projects are often less expensive than vacations and can be fun and rewarding.

Take A Mini-Vacation

One major problem when planning a summer vacation can be going overboard. It’s extremely easy to get carried away. What often starts as just a week in Honolulu can quickly snowball into a week at a five-star resort, complete with lavish meals and pricey drinks. Instead, consider taking a mini-vacation.

The key here is to adhere to a strict budget and plan each aspect before the start of the trip. This includes having meals and activities mapped out before arriving at your destination.

Some ways to cut down on vacation expenses might include driving instead of flying (if cost effective); opting for a mid-tier hotel such as a Courtyard by Marriott instead of JW Marriott; and forgoing formal dining for cheap eats like street food and food trucks.

Helpful links:

And Our Favorite: Stop Hoarding Points and Miles and USE Them

This might be extremely difficult for those among us who hoard points. Many frequent travelers have racked up tens (even hundreds) of thousands in points and miles but no matter how good a deal might be, many travelers can’t seem to pull the trigger to book a flight or hotel. With airlines and hotels devaluing points and miles programs more often than not, it’s important that you spend the points and miles you’ve earned. Rarely do the value of your points or miles increase in value.

If you are trying to pay down debt this summer, you might consider tapping into your frequent flyer and hotel rewards accounts instead of spending cash. As readers of TPG know (and even for you beginners out there), points and miles are extremely valuable and can take care of the cost of your entire summer vacation.

Helpful links:

See TPG’s latest valuations to ensure you’re getting the most out of your points and miles this summer.

Your points and miles might allow you to pay off debt and take a summer vacation.

Credit Cards For Paying Down Debt

While we don’t ever recommend carrying a balance on credit cards, if you find yourself in a situation in which you are unable to pay the full balance, it’s best to have that balance on a credit card with little to no interest and no annual fee. Furthermore, if you are looking to transfer balances from a credit card with a high interest rate, it’s important to find a credit card with waived- or low-balance transfer fees. Here are the top credit cards for paying down debt.

Chase Freedom

The Chase Freedom card and Chase Freedom Unlimited card are two solid no-annual-fee cards. Each card features a 15-month 0% APR period for new purchases and balance transfers. The variable interest rate following that 15-month introductory period is 17.24% to 25.99%. The card has a balance transfer fee of either $5 or 3% of the amount of the transfer, whichever is greater.

Capital One Savor Cash Rewards Credit Card

The Capital One Savor Cash Rewards Credit Card has no annual fee and features a 15-month introductory period in which the APR is 0% for balance transfers. Balance transfers will incur a 3% fee. Following the introductory period, the card has a variable APR of 16.74% to 25.74%.

Blue Cash Everyday® Card from American Express

The Blue Cash Everyday Card by American Express, as with other cards on this list, does not have an annual fee (see rates & fees). The card also features a 15-month 0% APR introductory period (see rates & fees). Balance transfers are included in this 15-month 0% APR period, however, all balance transfers must be completed within 60 days of opening the account. After the introductory period, a variable APR of 15.24% to 26.24% applies (see rates & fees). Finally, the card will incur a 3% fee or $5 fee (whichever is greater) on all balance transfers (see rates & fees).

Citi Double Cash Card

The Citi Double Cash Card card offers 18 months of interest-free financing on all balance transfers (then a variable APR of 15.74% to 25.74% applies). Balance transfers, however, will incur a 3% or $5 fee, depending on whichever is greater. Like all other cards featured on this list, the Citi Double Cash Card does not have an annual fee.

Helpful links:

Bottom Line

We can’t stress this enough: TPG does not recommend that you ever carry a balance on credit cards. Even if carrying a balance means earning a lucrative sign-up bonus, it’s important to pay your monthly credit card bill in full to maintain an excellent credit score.

If you are currently holding cards with high balances, summer is a great time to pay down these balances. Although this may mean forgoing a vacation, you will utter a sigh of relief once you’ve paid down your debt — especially come the holidays.

In addition to working to knocking off debt, there are numerous alternatives to a traditional pricey vacation. Opting for a staycation, following a strict budget on a smaller less-lavish vacation, or finally dipping into your points and miles are just a few of the ways to stay on track while having a little fun at the same time.

For the latest travel news, deals and points and miles tips please subscribe to The Points Guy daily email newsletter.

Featured image via Shutterstock

For rates and fees of the Blue Cash Everyday card, click here.

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2018 TPG Award Winner: Mid-Tier Card of the Year
Chase Sapphire Preferred® Card

NEW INCREASED OFFER: 60,000 Points

TPG'S BONUS VALUATION*: $1,200

CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners

*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.

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More Things to Know
  • Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 toward travel when you redeem through Chase Ultimate Rewards®
  • Chase Sapphire Preferred named "Best Credit Card for Flexible Travel Redemption" - Kiplinger's Personal Finance, June 2018
  • 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
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  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 60,000 points are worth $750 toward travel
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Intro APR on Purchases
N/A
Regular APR
18.24% - 25.24% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent/Good

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.