Cash vs travel credit

Hopefully this is obvious to any seasoned traveler facing a cancellation, but given the choice between a cash refund versus a voucher for future travel, you always want to take the cash.

A travel voucher, essentially an IOU for future travel, is typically the quickest, easiest option for both passenger and the company. But there are concerns that make me wary of going with this choice.

  • What if I can’t travel within the voucher period? This aspect is progressively more important with increasing complexity. The larger the group, the longer the trip, and the more numerous the destinations make it much harder to reschedule. This is especially the case if traveling with multiple people from different households.
  • What if the experience isn’t worth the initial cost? This is a concern with the present COVID situation. Let’s say you push a tour back a few months and are able to go. Stuff is still going to either be closed or limited. I really do not see any realistic possibility of sitting in a crowded Irish pub pounding Guinness happening in 2020. That’s one of the experiences I paid for, and it may be worth waiting a while to get the full experience for the big sum of money involved.
  • What if the company doesn’t exist anymore? This happens with restaurants and breweries all the time. You have a gift card that is suddenly worthless because the establishment goes out of business. I can definitely see this happening with some of the group tour companies and even the smaller airlines. They go kaput, and you’ll really wish you had taken the cash instead of the now useless credit.

I got to thinking about this topic specifically because I have a Trafalgar group tour coming up in September to Europe. It involves me, Mrs. Lite and Mrs. Lite’s mom who lives in a different part of the country, so there are more moving parts to take into account.

Our specific cancellation policy is 60 days minus the deposit, so around 70 days before the departure date, we’re going to decide whether to get our cash back or gamble and hope the vacation proceeds as planned.

Part of the problem is that Trafalgar isn’t announcing blanket cancellations until under 60 days before departure, so there’s a risk that if we wait, the trip could be cancelled by the tour operator and we wouldn’t be able to go regardless. Unfortunately, Trafalgar is one of the many tour companies that is refusing to give refunds if they are the ones doing the cancelling, and I suspect they’re cancelling tours on a rolling monthly basis to get under the 60 day limit so people can’t qualify for refunds. I understand why they’re doing this, as I imagine their business is a disaster right now, but I still think it’s wrong and this experience will factor into whether or not I use them again in the future.

Of note, Rick Steves is the only tour operator I’ve found in my limited research that is giving cash refunds to all its passengers who had cancelled vacations. Those people will be repeat clients for life with such good customer service.

Another example in a different business category is Bonnaroo versus Firefly. All music festivals were either cancelled or postponed. Firefly gave refunds to all ticket holders no questions asked; Bonnaroo is refusing to refund anyone after “rescheduling” the festival to the Fall, like anyone believes that’s actually going to happen. Think that approach will affect which music festival people choose going forward? I certainly do.

In times of uncertainty, cash is king, so if you’re facing the prospect of a vacation not happening, do everything in your power to get your money back. Even if you have to forfeit a small deposit, I still think the added flexibility is more than worth the cost.


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