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Book now, pay later vacations are on the rise.

As more people set off on adventures around the world, they’re realizing that travel can be expensive. However, there are a growing number of options to pay for those getaways, including travel payment plans.

Here’s what would-be travelers need to know about this travel hack and payment option and how to decide if it’s right for them before they take off in a plane, train, or automobile.

What a Payment Plan Vacation Really Means

Buy now, pay later vacation plans work in a similar way to traditional layaway options at stores. Travelers pay a little upfront and pay off the rest over an agreed-upon timeline. However, unlike traditional layaway, where a person can pick up their item only when payments are complete, travelers get their item — their trip — upfront.

There are several book now, pay later payment options on the market including Afterpay, Affirm, Klarna, and Uplift. When booking a vacation using a payment plan option, you’re actually paying the financing company rather than the travel company itself.

For example, if you book a Carnival cruise (one of the companies offering this as an option), you’ll pay via Uplift. Uplift will then pay Carnival directly for the vacation in full. When you make payments, you’ll be paying Uplift, not Carnival.

Payments can be made over weeks or months, depending on the trip you’re taking, how much it costs, and which payment option you choose. Before signing on the dotted line, you’ll be assigned an interest rate based on data including your credit score, much like you would when applying for a credit card or loan. The rate will always be displayed before you click “book,” but reading the fine print is important so you are aware of all the terms of the agreement, not just the interest rate.


💡 Quick Tip: Before choosing a personal loan, ask about the lender’s fees: origination, prepayment, late fees, etc. SoFi personal loans come with no-fee options, and no surprises.

Companies That Offer Buy Now, Pay Later Vacations

The love for vacation payment plans is growing across the travel industry. Here are a few of the major players that are in the game.

Expedia: Expedia offers book now, pay later vacations through Affirm. At checkout, travelers can choose whether to make four interest-free payments every two weeks or monthly installments.

Priceline: Like Expedia, Priceline also offers book now, pay later vacation payment plan options with Affirm, with similar payment options.

Hotels.com: Hotels.com is offering payment plan options with Zip. Customers can split their payments into four installments over six weeks.

VRBO: VRBO is also getting in on the book now, pay later vacation option with Affirm. Customers can pay the total cost of the trip in three, six, or 12 monthly installments. Fixed payments come with interest rates ranging from 10% to 30% APR based on your credit profile.

Airlines: Airlines are also offering a book now, pay later option for those looking to fly to their destination. American Airlines, Delta, United, Southwest, Alaska Airlines, Air Canada, and Allegiant are some of the 16 airlines offering this option.

Cruise lines: Cruise lines are also getting into the act. Carnival, Norwegian, and Royal Caribbean are all offering vacation payment plan options to cruise lovers looking to stretch their vacation budgets out over months.

Recommended: Tips For Finding The Top Travel Deals

The Pros and Cons of Book Now, Pay Later Vacations

There are benefits to the book now, pay later vacations. Most obviously, you can book a vacation now and pay for it later. That could allow you to lock in your plans — and maybe even take advantage of a good deal or favorable rate — instead of having to wait until you’ve saved enough cash.

But there are potential drawbacks, too.

For starters, travelers may run the risk of overextending themselves financially if they book a vacation but can’t make the payments on it. According to a 2023 report by the Consumer Financial Protection Bureau, book now, pay later travelers are more likely to be highly indebted or have a balance or delinquencies on their credit cards compared to non-book now, pay later travelers.

There’s also the potential impact on your credit score. Though not all companies run a credit check when you choose the book now, pay later option, some do. And this could affect your credit score. Likewise, the service may report late payments to the national credit bureaus, which could also negatively impact your score. To find out if a credit check will be run before booking, reach out to the service directly.

Recommended: Ways to Be a Frugal Traveler

Personal Loan as an Alternative to Buy Now, Pay Later

If you want to take a vacation without having to save the money to pay for it first, you may want to consider an unsecured personal loan.

Taking out a personal loan is still taking on debt. But an unsecured personal loan allows a borrower to take out the amount needed to pay for a vacation with fixed interest rates that are generally lower than credit card rates and possibly lower rates than those offered by buy now, pay later financing options. Shop around and compare rates and terms to see what makes the most sense for your financial situation.


💡 Quick Tip: Generally, the larger the personal loan, the bigger the risk for the lender — and the higher the interest rate. So one way to lower your interest rate is to try downsizing your loan amount.

The Takeaway

Many travel retailers, airlines, and cruise companies are now allowing travelers to book their vacations upfront and then pay them off over time. While this could allow travelers to lock in a good deal, there are possible drawbacks to consider, including potentially high interest rates upon repayment. Travelers should look at all their payment options when deciding how to finance a trip.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.

Photo credit: iStock/hudiemm

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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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If you’re ready to take your relationship to the next level — whether through marriage or moving in together — you may also be thinking about how, once you’re sharing a household, you’re going to handle your finances. Should you split everything 50/50? Divide expenses based on income? Put all of your money in a joint account and pay bills from there?

There are numerous ways to split bills as a couple and no one “right” answer. The key to getting it right is to maintain honest, open communication about your expenses and income and to create a plan that works for both of you. Here’s a look at the variety of ways married (and unmarried) couples can share and pay expenses.

4 Different Ways to Split Bills

The best way to share expenses as a couple will depend on your financial circumstances and personal preferences. Here are four different options to consider.

Splitting Bills Evenly: The 50/50 Split

Many couples find it easiest to maintain separate financial accounts with their own funds and split shared bills — like rent, food, and subscriptions — down the middle. While this is easy in terms of math, it can be a little tricky when it comes to payments, since some service providers may not let you have two names on the account and accept two payments.

To make it work, you may want to have one partner cover the bills and save receipts, then have the other pay their half at the end of the month. Or, you could set up a joint bank account, each contribute the same amount of money each month, then pay shared bills from that account.

Splitting Bills Proportionally Based on Income

Splitting expenses down the middle might not seem fair if one person makes significantly more than the other. In that case, a more equitable solution might be to split expenses proportionally according to each partner’s income. For example, if you make $60,000 and your partner makes $40,000, you might split bills using a 60/40 split. If, for example, the utility bill is $100, you would pay $60 and your partner would pay $40.

To do this, you both can set up a direct deposit from your individual accounts to the shared joint account for your agreed share of the expenses.

Or, you might agree to each contribute 35% of your monthly income to shared living expenses to a joint account each month, and use that account to pay bills. While the percentage you’re depositing is the same, the higher earner will be contributing more actual dollars into the account than the lower earner each month.

Recommended: Making Important Money Decisions in Marriage

Assign Bills to Each Partner

Another way couples can split expenses is to simply divide up the bills into “yours” and “mine” piles. One partner might pay for the rent, while the other might cover utilities, insurance, and streaming services. If you’re looking for a 50/50 split, however, you’ll want the amounts to be somewhat equal.

This approach to splitting bills may require some occasional tweaking, since expenses may change over time. However, it allows each partner to maintain their own separate bank accounts and maximum financial independence.

Pooling All of Your Funds

With this approach, what’s yours and what’s theirs is all considered “ours.” You only have a joint account — both of your paychecks go into that combined account and all expenses come out of that account. This can be a good way for married couples to split expenses and can enhance trust in a relationship, since there won’t be any secrets about money.

If you want to maintain some independence and privacy with your money, you might each have your own separate credit cards.

Recommended: The Pros and Cons of Joint Bank Accounts

Should You Have a Joint Bank Account?

If both you and your partner earn money and are married or committed to a shared life, it can be helpful to set up a joint checking account. You can both direct your paychecks into this account and use it to pay for your shared expenses and transfer a set amount each month into savings to work toward shared goals.

This doesn’t mean you need to pool all of your money, however. You may still want to maintain personal checking accounts so you can continue to maintain some financial independence. Some couples opt to set up an automatic monthly transfer from the joint account into each partner’s personal account (say a few hundred dollars). This gives each person a “judgment-free” spending zone.

Tips When Deciding How to Split Bills

However you decide to divvy up expenses, here are some tips that can help simplify the process and keep money tensions from taking a toll on your relationship.

•   Determines who will pay the bills. To avoid confusion (along with missed payments and late fees), it’s a good idea to put one partner in charge of paying all the bills or, if you want to share the task, clearly determine who will pay what each month and stick to the plan.

•   Check in with each other regularly. Once you decide on a bill-sharing strategy and have been using it for a few months, it’s a good idea to regroup and discuss how the plan is working, and whether you need to make some adjustments. Continue to schedule regular financial check-ins, so you each have a chance to bring up any money concerns that are on your mind.

•   Agree to disagree about some things. You and your partner likely don’t see eye-to-eye on all things money. Indeed, you may have very different viewpoints about spending and saving. And that’s okay — you don’t have to agree on everything. Try to respect each other’s feelings about money and come up with compromises that make you both feel happy and secure.

•   Get help from a free app. Budgeting apps, like HoneyDue and Goodbudget, can be a big help as you learn how to manage your finances as a couple. They bring all of your financial information together in one shared digital place. No more wondering if your partner paid a bill or what the balance is on your debt.

The Takeaway

When it comes to splitting bills as a married or cohabiting couple, there is no “should.” The best approach is one that works for each of you and for your relationship. Some options you might consider include: splitting bills in half, using an income-based percentage, assigning specific bills to each person, and pooling all of your funds in a joint account.

Whichever way you go, keep in mind that it doesn’t have to be all or nothing — you can choose to merge some of your money to use for shared expenses and savings goals, while still keeping some funds separate.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

How do most married couples split their finances?

Married couples approach their finances in all different ways. Some combine all of their funds in a joint account out of which all expenses get paid. Others opt to keep their finances separate and split the cost of shared expenses (either 50/50 or proportionately based on income). Still others take a hybrid approach, pooling some money in a joint account but still keeping some money separate.

Is it okay to keep finances separate when married?

Yes. Many couples choose to keep their money separate even after they get married. You can split expenses from separate accounts or you might choose to pool some money in a joint checking and/or savings account to use toward shared expenses and goals.

Who should pay the bills in a relationship?

These days, dual-income couples often choose to split the bills, either down the middle or proportionately based on their incomes.

Should couples pay 50/50?

Many couples split bills 50/50, especially if they are earning similar salaries. If your incomes are significantly different, however, a more equitable solution might be to split expenses proportionally according to each partner’s income. For example, If you make $60,000 and your partner makes $40,000, you might pay 60% of shared expenses, and your partner would be 40%. So, if your rent is $1,000, you would pay $600 and your partner would pay $400.

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Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.