You’ll find a lot of posts on The Dime about managing finances responsibly, but let’s not forget that one of the goals for most of us is balance. And that means it’s time to start thinking about a little rest and relaxation – a.k.a. a vacation!
Taking a break to see new sights and experience different activities helps fuel the creativity we bring to our families and our workplaces, but fitting it into our overstrained budgets can be a challenge. Here are some ideas to get you started on the funding process:
Set a Reasonable Price Point
The old guideline was that the annual “major” trip shouldn’t cost more than one week’s salary for the household. If your debt and savings are in line, that’s probably a good starting point, but if you’ve fallen behind on repaying bills or funding your savings, you may need to downsize your travel plans accordingly.
Don’t neglect to account for incidentals and cost overruns. You should anticipate as many expenses as possible, but some travel experts recommend adding 20% to 25% to the planned costs for items that pop up after you’ve reached your destination.
Skip the Credit Cards (unless charging is a benefit to you)
The only time you should consider “charging” a significant part of your vacation expense is if you’re gaining rewards points or dollars on the card (that will help fund future travel), and you have the discipline to pay the vacation expenses in full before finance charges start accumulating.
Set Up a Special Vacation Account
Open a separate savings account and have a set dollar amount taken from each paycheck. When you’re deciding how much money you can part with today (in order to have something special to look forward to tomorrow), think specifics.
Can I give up ordering in pizza once a week in order to have a great dinner when we’re in San Francisco? Knowing how much money you have in your account will also help you make decisions about the affordability of any extra activities once you’ve reached your destination.
Find Creative Ways to Add to the Account
Have the family collect all the coins or small bills that tend to accumulate in pockets or wallets and deposit them to the vacation account on a monthly basis. If you get any “extra” pay (performance incentives, private tutoring, etc.), add that to the fund.
Lack Saving Discipline? Get Help.
You’re not alone, and there are actually vacation “layaway” plans. This is similar to funding a vacation savings account, but instead of paying yourself, you make regular payments to a tour operator or travel services company prior to your trip.
Of course, with this kind of arrangement, it’s imperative that you’re dealing with a reputable organization that won’t skip town with your bucks and no trip. One recent entry into this market is a familiar name – Sears. According to their promotional information, Searsvacations.com offers a variety of bargain travel packages, and in some cases you’ll obtain additional savings by booking through them.
Get Started Now
So start planning and saving now for your 2013 excursion. Think how much more relaxed you’ll be on your trip, knowing that the finances are already covered!