Can you really afford not to go on holiday?

No, this is not an article about income versus expenditure. It’s about your life.

With the holiday season approaching, it’s likely that we’ll see less caravans on the highways and more traffic in the cities approaching Christmas. Why? Because 2019 was a year of financial hardship for most, with harrowing exchange rates, skyrocketing unemployment figures, the re-emergence of load shedding and ongoing Eskom woes, the downgrade sagas… Many families might well decide to save money by not taking a December trip.

“We, as a business that understand the lifestyles pressures that people face believe that you should do all that you can to go on holiday,” comments MiWayLife CEO Craig Baker.

Are you serious?

Not quite what you were expecting the finance guys to say? Of course, we don’t advise irresponsibly taking money out of your savings or any other vehicle, but if you’ve met your obligations and you were just going to use that money on something sensible but not vital, or as further “in-case” money because 2020 may be even crazier than this year, we think you should take a trip instead.

Why? Because some things are worth more than money and you are going to struggle to look after everything if you don’t look after yourself. It’s just about holidaying smart, so you don’t incur extra expenses on route.

But what about petrol prices?

Petrol prices are a constant bugbear for people – it rises ten cents and everyone drives to the garage at midnight. But what about far more expensive costs, and what if you could avoid them?

If you think petrol prices are brutal, try looking at the ever-increasing cost of healthcare – and unlike fuel costs you never get a decrease on medical costs. Medical inflation was around nine to ten percent, according to FA News, plus another one percent VAT increase added on.

While this figure may not sound significant, think about what your possible salary increase will be for 2020 – we’re betting it is unlikely to be 11 percent – and then imagine having to pay for a hospital stay after a disabling injury while on holiday. It's also worth bearing in mind that medical aid inflation is not CPI-linked and medical professionals or businesses are not limited to the inflation rate. In fact, most medical aid rates increased 8.3 percent in 2019, more than double the inflation rate. This is so prevalent that the Competition Commission's Market Inquiry into the Private Healthcare Sector, released this year, calls the industry 'excessive' and a 'market failure.'

Accidents happen

It’s human nature to ignore the dangers of what could happen especially when contrasted against a positive, sunny scenario like a family summer holiday. But misfortune happens, and regardless of the circumstances under which it occurs, you want to make sure that you and your loved ones are protected as comprehensively as possible. The incidence of car accidents increases dramatically in December, whether or not you go on holiday. They needn’t be scary looming threats or reasons not to vacation, they just mean that you must take the necessary precautions before you relax and enjoy some time off.

All offshore that are going offshore

There aren’t many more ambiguous scenarios than being a stranger in a strange country when catastrophe strikes. “It’s worth your peace of mind to have a conversation with your life insurer, medical aid or adviser to ensure that you are covered for any eventuality while you’re in a foreign country. Do this before you jet off so that you are clear on what the standard travel insurance will cover,” says MiWayLife CEO Craig Baker. Always make sure that you have sufficient medical travel insurance but also enquire from your insurer whether your life cover and disability policies (if you have any) are valid in the areas to which you plan to travel.

Doing the calculations: life insurance payments versus paying the price

Actor Jackie Chan knows about making people laugh, and he knows a bit about life too. “Travel,” advises Chan in his autobiography. “Your money will return, your time won’t.” We love this little bit of advice - you can always work hard to make back the money, but the time sacrificed with family and friends can never be caught up. Just make sure that you have the necessary cover in place to ensure that you do not have to pay more than you bargained for, especially when there are so many affordable options out there to protect you.

Remember – the average hospital stay after a car accident or other holiday-related mishap costs tens of thousands of rands. Sometimes the cost is much higher in terms of all that precious time lost when you could have been making memories and relaxing with your nearest and dearest. Yet average* premium providing R1,5m of life cover only costs about the same as 80 percent of a tank of fuel for an average family sedan, or two full chickens plus two sides at a takeout restaurant.

Once you’ve bought the insurance, go ahead and invite some people over, buy those two chickens and sides. Or put that fuel in the car and take a spur-of-the-moment road trip with family – you’ve just saved a whole lot of time and money to spend making priceless memories with the people you love.