5 Top Tips for Saving for your Trip
5 Top Tips for Saving for your Trip
Whether you’re dreaming of a romantic weekend getaway to Paris, a two week safari in South Africa or an extended journey backpacking through South East Asia, your holiday is going to cost you some pennies.
One of the best decisions you can make is to save the money you need for your holiday before you actually go. This way, you can relax and enjoy the trip free from the worry and burden of any financial stress.
Additionally, the cost of taking out a loan or using a credit card for your trip can be substantial once interest charges are added, and you could end up spending the next year or two paying off the accumulated debt. It’s much better to take the time to save up before you go.
To work out how much money you’re going to need to save you’ll first need to do your research and make some travel decisions, such as:
- What is the cost of the flight?
- What is the duration of the holiday?
- Where are you going to stay and how much will it cost?
- What time of year are you going? Is it high season or low season?
- What tours do you plan on taking and how much will they cost?
- How often will you dine out and how much will it cost?
- What type of transport are you going to take?
- What souvenirs would you like to buy?
- How many gifts would you like to buy?
- How much extra should I factor in for unexpected incidentals?
- What impact will the exchange rate have on my budget?
Once you’ve answered these questions and done some research as so what the expected costs will be relative to the destination you plan on visiting, you will be able to estimate how much you will need to save and have a clear savings goal to work towards.
As a contingency plan only, it’s also a really good idea have a credit card (or two) available just in case you have underestimated the cost of your trip, or if you decide to do something spontaneous that you haven’t factored into the budget but don’t want to miss out on. Credit cards are a fantastic backup at times when your holiday budget falls short, especially when you’re travelling solo.
Now that you know how much money you’re going to need, it time to start saving. Here are my 5 top tips for saving for your trip:
1. Open a vacation savings account
If you open a dedicated vacation savings account at your local Bank, you will be able to easily keep track of how much you are saving without accidentally using the money for something else. How much you need to save each pay period will depend on your travel budget and the amount of time before your planned departure date. If you want to make saving for your trip effortless and especially efficient, sign up for an automatic period transfer from your cheque account to your vacation savings account. This will help you stay on track.
2. Eliminate non-essential ‘little extra’ from your spending
This one probably seems like a no brainer but quite often we don’t realise how much our regular ‘little extras’ cost unless we see the cold hard calculated facts. For example, my work colleague Jason was telling me one day that he would love to take his wife away for a romantic weekend getaway but with the cost of living, household bills and school fees he just couldn’t afford it. I quickly pointed out to Jason that he if stopped drinking the large cappuccino he purchased every morning from the coffee shop next door, which cost $3.80 per cup, he would save $19 each week, or $912 per annum based on working five days a week for 48 weeks of the year. When Jason realised that he was actually working one full week (his net weekly wage) every year just to pay for his morning coffee habit, he was absolutely gobsmacked. It had never occurred to Jason that the dream of taking his wife away for a romantic getaway could be so easily achieved by switching from a bought cappuccino to a regular cup of tea or coffee, which he could make in the staff tea room for free.
So, have a look at all those non-essential ‘little extras’ you purchase throughout the year, like lunches, take-out dinners and gossip magazines. Then calculate the monetary value of what they are costing you on a per annum basis and decide what you can live without. If you really must have your coffee and your lunches out, try to at least cut back for a while. You’ll be surprised how much money you can save!
3. Sell your unwanted stuff
We’ve all got unwanted stuff, like the lava lamp your Aunt gave you for your birthday five years ago that just doesn’t suit your new found sense of style. Whilst letting go of a gift someone special has given you can feel a little uncomfortable, it’s not doing anyone any favours hidden away in box at the back of your garage. You know the saying…. One man’s trash is another man’s treasure! You might as well let someone else enjoy it and swap it for some cold hard cash. I’m sure Aunty won’t mind! Especially if Aunty doesn’t know!
If you take a look around your house you’ll probably see a whole bunch of stuff that you never use and serves no purpose other than cluttering space in your house. Ask yourself “Have I used that in the last six months, and am I likely to use it in the next six months”? If you answer ‘No’, then it’s time to think about letting it go. If you’ve got heaps of stuff to get rid of you could have a garage sale. It might take a bit of time to sort and price your items, and arrange them in your driveway, but when you’re finished, your vacation fund will be fatter and your house will be neater.
If you don’t have enough stuff for a garage sale or you can’t guarantee that Aunty won’t drop by for a cuppa, you could go to a car boot sale or advertise individual items on websites such as EBay.
If you’re a fashionista with an overflowing closet, why not check out the local clothing consignment stores to see if they offer any buying programs. If you’ve got good stuff you could walk away with some decent coin to add to the kitty.
4. Pick up some extra work
A great way to ramp up your savings is to keep a look out for any opportunity to pick up some extra work such as over-time, or use your marketable skills to do some freelance work.
You could look online for a regular part-time job or simply ask people in your network of friends and family if they have any odd jobs that you could do for them, such as painting or babysitting. Everything counts and it all adds up!
5. Move back home
Did I just hear you gasp? If it’s at all possible you should at least consider this, especially if you’re planning an extended trip, as you’ll probably have to sub-let or cancel your lease. You might as well do this early and move back home until you’re ready to leave. Not only is it a great way to save money on rent, it also gives you the opportunity to spend time with your loved ones before you go away for what could be a long time. It’s a win, win situation for everyone!
Following my 5 top tips for saving for your trip takes commitment and involves and a bit of sacrifice but don’t let it become hard work! If it’s too hard you’ll get bored and lose momentum, so remember to keep it balanced and acknowledge the milestones along the way.
Each and every day of your life should be enjoyed and that includes the ones before, during and after your trip. That’s why I recommend cutting back on non-essentials but not necessarily eliminating them altogether and to avoid accruing holiday debt that could negatively impact your lifestyle when you return home.
Now that you have my 5 top tips for saving for your trip, I hope that you enjoy the challenge and satisfaction that comes from reaching your savings goal, and most importantly I hope you enjoy the trip of a lifetime!