The most important part of saving for a vacation is creating your budget. A budget creates the framework for how much you should plan on saving. And if you already have a travel savings, your budget will help you get the most out of your money.
Here are some of our top considerations when creating your budget:
1. Taxes and fees. Ever gone to purchase a $50 concert ticket, and by the time you check out the price jumped to $75? This can also be the case in travel. For example, hotels are notorious for showing the nightly charge before any taxes and fees. Make sure your budget includes these pesky charges that can add up quickly.
2. Food and Beverage. We know you have to eat. You know you have to eat. But arbitrarily throwing out $50 a day for meals doesn't help you understand what that food looks like, and can lead to overspending. We suggest breaking it into meal categories (breakfast/ lunch/ snacks/ dinner) and assigning each category a budget.
When assigning a budget to your meal categories, consider any items that would lower or raise your default category numbers (ie; a blanket statement of $30/each dinner). If you want to cook at your property one night this would lower your category number, while planning a special dinner to celebrate may raise it.
It is also important to include budget for the items you value while you are on vacation. Can't live without a morning artisan coffee or this is your time to drink dirty martinis – add it to your meal budget.
You may start to notice that the number you thought was enough, may not cover how you plan to actually eat & drink on your vacation. Remember you are on vacation; give yourself freedom by budgeting for a spike from your ‘normal’.
3. Location. There are some areas of the country you need to plan to spend more to get the same thing. Sometimes a hard pill to swallow, but should be a top consideration when planning your budget. Between how much a 16oz beer costs to your plane tickets - location will impact how far your dollar goes.
4. Transportation. We think a big missed cost in budgeting is your transportation costs. From the airport transfer, to getting to/from dinner. Every Lyft/Uber taken, you are accruing costs. You don't have to know where you are going to plan for this bucket. Instead of focusing on exact costs, use references from your own city or ride-share app estimates to create a budget for the major transportation you will use. And don’t forget parking! Leaving your car at the airport is an easy way to accrue an unplanned charge on your vacay.
Like with any budget, you don't accrue a loss for items not purchased. It is safer to plan and put money back in your pocket than to be surprised calculating your total post vacay.
Once you have created a budget, the next step is saving. Which can sometimes be the hardest part.
Here are a few savings tricks we use:
1. Set up a monthly transfer to your savings account for vacation savings before you have a vacation planned. This gives you a head start for when you decide to take a vacay and begin your budgeting.
2. Give yourself time. This may be a no brain-er of savings, but it is the most important rule. The sooner you can start saving the easier it will be to accumulate your desired budget.
3. Break down your total vacation budget into a weekly or monthly savings plan. A lump sum can feel overwhelming and maybe unachievable, but if you break it down to something more digestible it can become easier to begin the savings process.
4. Find areas of savings in your everyday budget. And apply it to your vacation savings. Aren’t using your Netflix subscription? Can you start making coffee at home instead of a daily Starbucks? The goal is to not deprive your daily life, but identify if there are areas in which you can save and to help meet your vacay goals.
Have any other tips/tricks for creating a budget and saving for your vacations? We’d love to hear from you. Comment below!