Should I book DIY holiday or travel agent's package deal?
Your questions answered
Q I want to book a family holiday and when I compare the price of package holidays, they are more expensive than if I was to book the flights and accommodation separately myself.
I have heard about tour operators going out of business. On the other hand, if I book everything myself, what if something goes wrong or the hotel isn't what we expected? How do I decide which is the best option for me?
Karen, Co Kildare
When you are booking a holiday, not only is there an array of locations to consider, but you may also need to factor in flights, transfers and travel insurance. Along with taking away the hassle of making all the arrangements, booking a package holiday also provides you with additional rights.
Before you travel, the tour operator or travel agent must provide you with all of the details about your holiday, such as all costs, cancellation arrangements, and so on. It is also responsible for ensuring that your holiday runs smoothly. If for example the service provided is different from what was promised to you, it should fix the problem at no extra cost to you - or the operator must compensate you.
A package holiday can be more expensive than booking a holiday directly - so if you are on a budget or you want to have more choice, you might prefer to do the booking yourself. Although your rights are not quite the same, you still have protections - for example for flights cancellations or delays. You could also consider booking your accommodation through a website which allows you cancel for free up until the time you travel. If you choose to book a holiday yourself, one of the most important tips is to do your research beforehand and to be extra vigilant for rental scams.
It's worth noting too that the Commission for Aviation Regulation runs a scheme which protects qualifying customers of Irish-licensed travel agents and tour operators from losing their money or being stranded abroad should the agent or operator go out of business. This protection is available through licensed travel agents and tour operators.
Remember, regardless of which option you chose, make sure to take out travel insurance as soon as you book so you are protected straight away. Be sure to understand the terms and conditions of your policy however - including any restrictions on or exclusions of cover. Remember, if you buy your holiday through a travel agent, you do not have to take out travel insurance with the travel agent - you can make your own arrangements for this.
Can I fix my finances?
Q After being unemployed for almost a year I am starting a new job in a few weeks. When I lost my job, I had no savings to fall back on and ended up maxing out my credit card and missing a few payments. I'd like to buy a car in a few months and I'm worried I may not be able to get a loan. What can I do to get my finances sorted out?
Eamon, Co Louth
Losing your job and getting through the financial difficulties you described cannot have been easy. It is great that you are thinking ahead and preparing for the unexpected.
Getting started is often the hardest part of getting on top of your finances, but it is essential in helping you build your financial security and deciding whether you are in a position to buy a car. The first step is to write down exactly where you are at now. What do you have in your current or savings accounts? What debts do you have outstanding? What other financial commitments do you currently have - such as health insurance, rent, bills and so on.
Next, work out exactly how much you are going to be paid each month when you start your new job. It is important that this is the figure that you are paid into your bank account after any deductions. If you have any other income, list that too. Then you can see what you have left after meeting your commitments and whether you can afford a car.
If you have missed repayments in the last five years, it will show up on your credit history. When you apply for a loan, the lender will check the Central Credit Register. If you would like a copy of your report, you can request a free credit report through the Central Bank's website. If your credit history shows you have missed payments, you may need to consider delaying applying for a loan.
In the meantime, you can work on building up your savings and clearing your debts. While the temptation might be to focus on your savings to put towards your car, it may be more beneficial in the long run to clear your debts first. Not only will it put you in a stronger financial position now, but it will work in your favour in helping you get that car loan.
How do I pay off card?
Q I went on a big holiday to the US last year and ended up using my credit card to pay for most of it. I now owe more than €4,000 on my card. I always pay the minimum balance I owe on my card each month but when I looked through my January bill, I worked out that it is going to take me years to clear the debt unless I do something different. I'd really like to have my debts cleared by the end of the year - how could I do this?
Linda, Co Meath
Credit card debt is a trap which is easy to fall into - it is very tempting to spend now and not think about how you will repay the money later. However, credit card debt is one of the most expensive ways you can borrow money. The interest rate charged on credit card balances currently ranges from 13.8pc to 26.6pc. It is tempting to only repay the minimum amount each month, but by doing so, you are paying more in interest and extending the amount of time it will take you to clear the debt.
So, work out how much you can afford to pay each month and make a plan to reduce the outstanding balance as quickly as possible. Take a look at your monthly budget to see where you might be able to make savings which you could then use to reduce your credit card balance. When you have an idea of where your money is going, you might spot some areas where you can reduce your spending and put more money towards clearing your credit card debt.
As well as repaying the amount you owe in as short a time as possible, there are other ways you can also reduce the amount of interest you have to pay. Some credit card providers offer low or zero interest on balance transfers for a period of time, so it might be worth checking if you can switch to a card with a lower rate of interest than you are currently paying. The credit card comparison on ccpc.ie is a good starting point to see what other providers are offering, if you do decide to switch. If you don't want to switch, ask your credit card company if it can reduce the rate of interest you are currently paying.
Avoid using your credit card unless it is an emergency. You can use your debit card for most things.
Aine Carroll is director of communications and policy with the Competition and Consumer Protection Commission
While we will endeavour to place your questions with the most appropriate expert for your query, this column is not intended to replace professional advice.
Sunday Indo Business