Is travel one of your New Year’s resolutions? Do you want to take that family vacation or dream honeymoon, but the thought of high costs is putting a damper on your dreams? There are countless ways to make your travel dreams a reality without having to go into debt. I will share with you some tips and tricks, things I have learned and used, to help turn your DREAM vacation into REALITY.
Research in order to set goals
You can’t start saving if you do not know how much you will need. Therefore, your first step is to research. Use guidebooks, internet searches, ask your family and friends, and gather as much information as you can. What are the average flight, hotel and rental car costs? What do you want to see and do and how much are the costs to those? Will you be eating at restaurants or buying at supermarkets, and what is the cost of food? And don’t forget extras like insurance, baggage fees, passport renewals, visas, or any other items you may need to purchase before the trip.
Once you have an idea of what the total cost will be (this is your goal) then you can calculate how much you need to save each month to achieve your goal. So for example if your Dream vacation will cost $5,000 and you want to go in 2 years’ time then you will have to save $208 a month to reach your goal. Remember “Goals are Dreams with Deadlines”
Set your priorities and find ways to extra savings
Now that you know what it is going to cost, you are probably stressed out and thinking to yourself “I don’t have that kind of money”. First of all take a deep breath and calm down. I am here to tell you that you probably do have that money you just don’t know it. First thing you need to do is analyze your spending and then set your priorities (I am assuming travel is you priority which is why you are reading this). For example that $4 daily non-fat latte treat can add up to $120 a month or $1440 a year. That is a HUGE chunk of extra money you can use for that dream vacation. I am not saying you should not treat yourself on occasion, but you should evaluate your spending and decide if that treat is worth it. In the end I believe that your dream vacation will be much more rewarding than a one-time treat. Travel is and experience and it will create memories that will last you a lifetime. A few other easy ways to save:
- Cook meals at home/go out to eat less
- Exercise outdoors instead of paying for an expensive gym
- Downgrade your cable
- Discontinue some recurring charges like a magazine subscription or a movie or music subscription
- Pack your own lunch for work
- Save that tax refund
- Set up a change jar
Set up a separate vacation account
You have already found small ways to accumulate extra savings now you need a place to keep it so you do not spend it. Set up an account that will be dedicated just for your travel goal. I like to use a different bank altogether so I am not tempted to withdraw the money or use it for other things. Once the account is set up you want to determine an amount to have direct deposited each pay period from your employer directly into this account. Remember your goal and timeline, this will be your guide to help you determine the correct amount for your direct deposit. What you do not see you do not miss.
Tip: Look at banks that give you monetary incentives to open an account with them or consider a CD or online bank that provides a higher return on your money.
This is not for everyone, but applying for and using the correct travel rewards credit card can provide great value and reduced costs for your travels. You must be financially responsible with your credit. You must pay off your card every month. And you need to select the right card. With the right card and strategy you can rapidly earn points that could allow you to book free flights or hotels. I personally use several cards but my favorite one by far is the Chase Sapphire. To find out which card is best for you and to learn tips and tricks on points and how to use these for travel, feel free to check out blogs from The Points Guy or The Frugal Travel Guy. These have helped me with my points and travel strategies.
It may seem like you have a long road ahead of you, especially if you are looking at a year or more to reach your goal. What you need to do is find things to keep you motivated and inspired so you do not go off track. Plan some things to do that are inspired by your vacation. For example – let’s say your dream vacation is Spain. You could take some Spanish lessons or learn to dance the Flamenco. You could have some friends over for Spanish inspired evening – serve sangria and tapas. You could take a photography class to improve skills to capture those travel memories or read some books that inspire travel.
I also like using social media for my inspiration and best of all this is FREE. Create a Pinterest board and pin pictures of things to do and see as well as possible itineraries. Follow Instagram accounts related to travel or read some travel blogs for inspiration. Inspiration is all around us and there is plenty to keep you motivated and on track with your savings.
What are your travel goals and what tips do you have for budgeting and saving for a dream vacation?