Brits borrowing money to pay for summer holidays

Many Brits are risking falling into debt to cover the cost of summer holidays.

According to Compare the Market, three-quarters (75%) of people believe summer holidays are becoming a luxury that many can’t afford.

As a result, those who do want to get away are having to make tough financial choices in order to pay for it.

Figures showed that more than half (54%) are relying on savings to pay for their holiday, while one in five (21%) are taking on extra work or overtime.

But others are borrowing money.

For example, 20% have used credit cards to fund a summer break, 10% have had financial help from friends or family, and 5% have taken out loans.

People cutting back on other costs

Many are also scaling back their spending in other areas to pay for this year’s summer holiday, including:

• dining out - 36%
• buying clothes - 33%
• social events - 28%
• big purchases like a computer or new car - 25%
• leisure activities - 25% 

Others have reduced:

• how much money they put into savings - 24%
• spending on subscriptions - 19%
• food shopping - 17%
• haircuts and beauty treatments - 15%
• their water and energy usage - 13%

Why are people struggling to afford holidays?

People polled by Compare the Market highlighted many reasons why they were struggling to afford a holiday this year, such as:

• the increasing cost of living - 72%
• higher travel costs - 55%
• higher accommodation prices - 44% 

Some have also been put off by: 

• uncertainty about their future finances - 28%
• a fall in their household income - 22%
• higher exchange rates - 15%
• having family members and others to financially support - 10%

Budgeting for things that matter

When you think of budgeting, you might just think of making sure you’ve got enough money to pay your bills.

And yes, that’s really important.

But budgeting doesn’t just mean that and not letting yourself have fun.

It can also include making sure you have money for treats, luxuries and experiences that enhance your life.

So if having a summer holiday really matters to you, factor it into your financial planning.

That means you can decide how much you want to spend and work towards this goal, without losing sight of how you’ll pay for essentials along the way.

Get started by checking out our guide to how to create a budget, so you can see how much money you have coming in each month and where it goes.

And give our budget planner a try - it’s free and easy to use.

You should also check out our 50 easy ways to save money on your summer holiday, so even if you’ve missed out this year, you can grab a bargain for 2026.