Summertime, i.e. vacation season, is quickly approaching. And whether your ideal getaway is R&R on the beach, outdoor adventuring, or exploring a new city, it pays to plan. Literally.
I'd love to get away. How do I save for a vacation?
You're not alone. One study says 71% of Americans are planning to take a trip for leisure in 2022. And they’re planning on (revenge) spending 29% more than they did pre-pandemic in 2019. But you don't have to go broke to get a break. Before you even start planning your travel itinerary, here’s how to make the trip you’ve been waiting for a reality.
Make a sinking fund. Aka your new travel buddy. These funds are where you set aside money with an intention to spend it on a big goal. For bonus points, automate a certain amount into your sinking fund from each paycheck.
Timing is everything. True for relationships, real estate, aaand travel deals. Research the cheapest places to go when the temp rises, and plan accordingly. You’ll also get more bang for your buck by checking out destinations with a favorable exchange rate. If you’re thinking beach, hit up Costa Rica, Mexico, or Colombia. Europe? Try Turkey, Portugal, or Czech Republic. For somewhere further east, your dollars will go far in Thailand or the Philippines. Reminder: Don't forget to check the latest COVID-19 restrictions before booking and takeoff.
Book smart. Renting a home is often a better deal than booking a hotel. Not only will you save on the price tag, but you can cook instead of eating out for every meal. That said, there are some great budget hotels out there — do your homework to make sure whichever way you go is economical. Lodging, hacked.
How do I keep saving while I’m on vacation?
True story: travel doesn’t feel like real life, so it’s easier to splurge. And if you’re visiting a popular tourist location, everything costs more. Here’s how to see the sights without losing sight of your budget (sorry).
Set a daily spending threshold and track what you buy to avoid overdoing it. Using cash or a prepaid debit card instead of a credit card can also help.
Food is a money vampire. If you have access to a kitchen where you’re staying, make breakfast, pack lunch, and cook dinner when you can. If not, hit up a supermarket or farmer’s market for an easy, cheap breakfast. And when you do eat out, go for lunch or appetizers, where the menu items tend to be less expensive.
And once I’ve come back to reality?
If you're suffering from a spending hangover — one survey says 42% of Americans have gone into debt to pay for a vacation — make a plan to pay yourself back. First, do the math to figure out exactly how much you spent over your limit. Gulp. Once you know the number, set a timeline. Then, divide the total amount by the number of months until you plan to pay it back. Breaking the total into bite-sized chunks makes it less daunting. And the sooner you pay off your plastic, the less you’ll owe in interest.
Vacations should be fun, not stressful. Planning ahead, staying money-smart while you’re there, and regrouping when you get back is a recipe for OOO without the oh no.
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