We all love to travel and I’m pretty sure we would travel more often if money was not a finite resource. The realities for most of us is that we have to save money for travel. It can take us a few months or sometimes a few years to have enough money for our trips.
I wanted to share some simple tips that can help get you to your dream destination a little quicker and make sure you don’t have to get into debt in the process.
1. Make a wish list
Make a wish list of all the places you would like to go. Now this is a wish list so you can go wild and crazy. It’s aspirational but it will get you excited and start inspiring you to start putting some money aside.
2. Rank your wish list
As much as we would like to visit as many places as we can, the reality is that we may not be able to visit all of them. In this step you list your wish list in order of priority. Is Europe or Asia first?its a tough one but you know your preferences better than anyone else.
Keep in mind that this ranking can be shuffled around after you go through the rest of the steps. Things like budget, when we can get time off work etc.. can affect the ranking.
3. Get cost estimates
You can now start getting ball park figures of how much your trips may cost you. You don’t have to cost you entire wish list, just the first two to five.
Most of the time I have to reshuffle my ranking based on the cost. I’ve had Europe on the top of my list for a few years now but because of the cost, I move it down the list because I need a bit more time to save up for it. It’s easy to research costs online or get quotations from travel agencies.
A few things to keep I mind when costing is that the timing of your trip matters and can affect the cost. So aim to book at least six months in advance and also try to travel in off peak seasons if possible. This will save you some ching ching.
Don’t forget to factor in spending money. This is often forgotten but it can be a deal breaker if you don’t put some money aside for it.
4. Assess your annual budget
A lot of people look at their savings monthly and say how much can I save each month? But I find, that planning an annual budget is more meaningful.
Write down you annual income and expenses. You need to be granular so that you don’t miss anything. Take out all essentials including retirement savings ( this is not a financial planning blog, haha but had to just throw it in there ) Then factor in a buffer or reserves for emergencies.
What ever you have left over, you can decide what portion of it is going into your travel budget.
Remember you now have an estimate of how much your trip will cost you after Step 4. Your surplus budget will determine how long it will take you to save up for your trip.
Not enough money? Or is it going to take you too long to save up? Then look at for items you can cut out of your expenses. How badly do you want that trip? If you want it bad enough, then maybe buying a latte from the coffee shop everyday can be cut down, maybe you can cut down on eating out and start cooking. Do you really need that new pair of jeans? Maybe not. This can help you save more money faster.
Still not enough money? Maybe take a local trip instead of an international trip? You can adjust your ranking based on this.
5. Start saving
Put some money aside each month according to your surplus budget. Your budget was annual so divide the surplus by 12 to get to your monthly savings.
I have a separate savings account for my travels. This helps with discipline. Every month after you have paid for all your essentials( and no, going out for drinks twice a week is not considered an essential) , put the money into your travel savings account. Do this at the start of the month and it’s done. You would be amazed at what taking this money out of your cheque account and into your savings account does to your psyche.
6. Plan your trip
Once you have saved enough money, you can start planning your trip. That’s a blog for another day.
I’m an advocate for living within ones means, so rather start with your budget and rank your travels based on affordability. Rather sacrifice some luxuries that are not absolutely necessary to have some more money to save for your travels.
I hope you found my tips helpful. Till next time…