How to budget a vacation without breaking the bank – GOBankingRates | Gmx Pharm

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Taking time off work to go on vacation should be a pleasant experience, but it can leave you with guilt and anxiety if you end up going over budget. Planning ahead is the best way to prevent this so you can leave your vacation feeling relaxed and refreshed instead of worrying about the credit card charges you’ve racked up while you were away.

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I spoke to finance professionals and other money experts to get their tips on budgeting for a vacation — without the guilt of overspending.

How to create a vacation budget

When it comes to creating a vacation budget, “the more detailed the better,” said Rachel Cruze, author, financial expert, and host of “The Rachel Cruze Show.” “How much will you spend on travel and accommodation? What about meals and souvenirs?”

In addition to flights, hotels, food and gifts, your budget should also factor in transportation during your stay and everything you need for your trip.

“Your budget should include the cost of renting a car after you arrive and the gas for that car, and insurance if you have to pay for it,” said Bobbi Rebell, personal finance expert at Tally and author of Introducing Financial Adults.” “It could also be clothes that you need to buy specifically for the trip. An example could be when you go hiking you might need special gear.”

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“Make decisions about your big spend ahead of time,” said Lacey Cobb, CFA, CFP, director of advice solutions at Personal Capital. “By prioritizing your pre-arrival shopping, it becomes easier to narrow down the list of sights you might want to see.”

You must also consider any additional costs that may accompany your absence.

“Don’t forget the costs associated with being away from home, such as B. Pet care,” said Lindsey Bell, Ally’s chief markets and money strategist.

In addition, you should also consider lost revenue.

“Although it’s not directly something you pay for, you should also consider that if you have a business or job that doesn’t pay you while you’re on vacation, you won’t get paid for the time you’re away. These are costs that.” must also be included in your planning,” said Rebell. “Your bills and expenses don’t stop.”

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How to save for a vacation

Cruze recommends setting up a sinking fund to save for your trip.

“A sinking fund is a strategic way to save money for a specific purchase, like a vacation, by setting aside a little each month,” she said. “It’s one of the best ways to be conscious of your money, especially if you’re saving for something very specific. So once you have your budget set, divide the total amount you need by the months left until the holiday and start saving.”

Consider cutting back on your spending temporarily so you can contribute more to your vacation fund.

“Review your spending over the past few months for unnecessary expenses to cut,” said Leigh Singleton, Monifi’s director of financial education.

If you have a longer period, you can invest your holiday money.

“If you have at least six months before you travel, you can earn interest by investing your savings and grow your travel budget even faster,” Ally’s Bell said. “Think of short-term investments, CDs or money market accounts, depending on your financial situation.”

It’s also a good idea to save more than you think you’ll need.

“Insert a pillow,” Bell said. “Remember it’s a holiday so it’s unlikely you can predict every dollar you’ll be spending. Instead, plan for some cushion money over and above the budgeted cost.”

“I budget a variety of $500 that I can use for impromptu purchases,” said Deanna Ritchie, editor-in-chief at ReadWrite.

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This is how you avoid spending more on your vacation

The first step to avoiding overspending is to be realistic about what you can actually afford.

“You may have earned your dream vacation before you can afford it,” said Tally’s Rebel. “Deal with it and make adjustments. If you can’t get past that one destination you’ve always wanted to visit, consider a shorter trip. Or, if you really want a longer break, consider a DIY route with cheaper accommodation that allows you to cook your own meals at a lower cost. If you’re dreaming of a beach vacation in a certain place but there’s a similar one on offer, jump on it.”

Once you figure out where you’re going and for how long, make an effort to save as much money as you can on the upfront costs.

“Take some time to research the best times to travel,” Cruze said. “If you’re a little flexible, play around with different options for dates and times. The cheapest flight days are Tuesdays, Wednesdays and Saturdays.”

If you travel during the week, you can also save on other costs.

“Staying at a hotel during the week instead of at the weekend saves money,” says Steve Gickling, CTO at Calendar. “Spa packages and park passes can also cost less during the week.”

You should also plan as much of your itinerary in advance as possible.

“Spontaneity can be fun, but it can also be risky,” Cruze said. “Planning your trip provides full transparency about the expected costs and the time required. It also doesn’t hurt to buy passes or attraction tickets in advance. That way you’ve already paid for it and you know exactly where it fits in your budget. You can also research areas with free attractions like zoos, museums, and parks.”

While you have money to spend on meals, snacks are an expense that can easily break your budget.

“Snacking while traveling can get very expensive,” said Lakisha L. Simmons, Ph.D., financial freedom coach and CEO at Brave Consulting. “I always buy snacks before we go. Each child has their own backpack with snacks and a refillable water bottle. Buying on-the-go snacks can be very expensive for a family, so I make sure to pack plenty of protein bars and fruit for the trip.”

Another way to save is to look for attractions that aren’t in super-touristy areas.

“Embrace the local culture,” said Cobb of Personal Capital. “Skip the main part of town in favor of side streets where restaurants are packed with locals.”

Cobb also recommends walking or taking public transportation rather than relying on taxis or ridesharing.

“That’s how you experience a city up close,” she says.

Also, look for ways to reduce spending on non-essential vacation expenses.

“Do you really need souvenirs for everyone at home?” said Allys Bell. “Assess your spending as you go and adjust as needed. For example, if you’re over budget, reduce your last day – maybe try cheaper restaurants. Or, if your budget is tight, you can spend more on gifts before heading home – or use it on your next trip!”

One way to ensure you don’t overspend is to take out as much cash as you budgeted for before your trip and only spend what you’ve allotted for yourself.

“Leave credit cards at home,” said Dwain Phelps of Phelps Financial Group. “Using your credit card can result in unnecessary spending. Using cash results in only spending what you have on hand. Carry a credit card for emergencies only. This can also protect you from having your identity stolen.”

Why you shouldn’t feel guilty about spending money on vacation

You should never feel guilty about treating yourself to a vacation — especially if you plan ahead.

“Take the guilt out of your vacation by setting a budget and sticking to it,” Ally’s Bell said. “If you’re second-guessing your holiday spending, it could mean you’re spending beyond your means or that your spending may not be aligned with your priorities. Think carefully about your budget before your trip and spend your vacation time with pleasure!”

And remember, while vacations come with a cost, the memories you can create are priceless.

“Tomorrow is not promised,” said Dr. simmons “While your focus may be on long-term debt settlement or saving for the future, know that these travel memories matter and can last a lifetime. No need to feel guilty because you are alive and enjoying life!”

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Gabrielle Olya contributed coverage for this article.

About the author

With eight years of personal finance experience at GOBankingRates, Jaime Catmull has built an extensive network of financial influencers and experts. Now she’s tapping into that network to find out how to live your best financial life and grow your wealth.

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