03/06/2018
Since traveling overseas for the first time last year, I have definitely caught the travel bug. My bank account, on the other hand, seems intent on stalling my travel dreams. But if my trip last year taught me anything it is that travel is possible on any budget - even one as small as mine. All it takes is proper planning, and a whole lot of sacrifice.
As humans, we perform best with reward based motivation. The rush that so many of us experience when purchasing new clothes or electronics isn’t there when you’re saving for a trip. No one congratulates you for transferring funds into your savings. I think this is one of the reasons saving for travel can be so hard. You can end up putting money aside for months (sometimes years!) with no tangable reward for your hard work.
This can make it difficult to stay the course, but trust me when I say that it is well worth it. Experiences and memories made while traveling will broaden your mind in ways nothing else can. Travel teaches you far more than any book you’ll read, and is worth more than any material item you can buy (which is ironic because it is expensive). If traveling is something you want to do more of, you’ll inevitably need to do less of something else.
I’ve put together 5 simple tips that I’ve used to stretch every dollar in my pocket and make travel a bigger part of my life. Hopefully they can help you reach your travel goals, too!
STEP 1: Organize Your Expenses
The first step in saving for travel is to look at your expenses and get organized. The best way to do this is to look at your income in a more visual way like a spreadsheet. Most of us don’t realize where our money goes each month, and what areas we can do a better job saving money in. Flights, hotels, food, transportation…its all expensive, and it all adds up. I use Google Sheets to make a spread sheet of my spending. It is a simple, free, and easy way to get organized and see where my money is going each month. You can read my post on how to create an expense sheet here for a step by step guide on how to get started.
After inputting all of your spending into your spreadsheet, you should have a much clearer picture of what’s happening inside of your bank account. The next step is to split your spending into two categories: your expenses and your “extras”. Expenses are things you MUST pay each month. This would include rent, groceries, car payments, student loans, phone bills, etc. Extras are essentially everything else! The money you use for travel will be coming out of your “extras”.
Take a good hard look at your spending habits to see where you’re currently spending that extra money. A great example I always like to use is coffee. A $4 cup of coffee every day adds up to $20 a week and $80 a month. If travel is important to you, you’ll have to drop your Starbucks run in favor of making a cup at home. Those small cost effective changes will add up. Any dollar that you can save at home is a dollar you can spend abroad.
STEP 2: Determine Your Travel Budget
This is the fun part. Personally, I like to pay for my trip before I step foot on the plane. Many people will opt to put everything on a credit card and spend months trying to pay it off afterwards. The problem with this strategy (besides accruing hundreds of dollars in unnecessary interest) is that you set yourself back for planning your next trip. If it takes you 6+ months to pay off the trip you just took, then you’ll likely have very little money to put towards your next adventure. To me, the best way to travel is to pay for everything upfront. That way you can go on your trip, spend your money without hesitation, and come home debt and worry free.
My budget is the first thing I start with when planning a trip. That way, I know exactly how much I need to save and am able to create a realistic timeline for my savings plan. Keep in mind that flying to somewhere like Australia from the U.S. is going to be more expensive than planning a domestic trip, which means you will need a longer timeline to save. The goal here is to find a realistic dollar amount to set aside each week and month up until your departure.
STEP 3: Research Your Location
In order to create a sturdy budget, you’ll need to research the location you wish to visit and determine the average costs there. For my trip to Europe, we researched the best time of year to visit, average hotel costs, average food costs, and the price of the activities and attractions we wanted to visit.
We input all of that information into another Google Sheet (can you tell I like spreadsheets?) and figured out that it would cost around $6,000. This included airfare, a very healthy food budget, hotels, transportation, attractions and plenty of room for any extra spending. We always opted to round up on the areas we were unsure of. I’d rather have too much money than not enough when traveling!
We certainly could have worked with a smaller budget for this trip, but we chose to stay in hotels instead of hostels and took private cars to and from the airport. After researching the best time of year to visit, we decided on the end of August/beginning of September. From there, we worked backwards from our $6,000 budget to figure out how much money we would need to set aside each month. It worked out to be $500 a month for just under 12 months.
STEP 4: Start Saving
Now that you’ve got a set budget and timeline in place, it’s time to start saving! As I said at the beginning, many people tend to struggle with sticking to their budget, especially for months at a time. Every time I would find the urge to spend money on something I didn’t need, I would ask myself what I valued more, material things or travel? Travel won every time.
A great tip I have for saving is to practice the out of sight out of mind method. If you’re bank allows, have them take the money straight from your paycheck and put it directly into your travel savings. Doing this forces you to figure out how to live off of what you’ve got and eliminates the threat of overspending and/or dipping into your travel money.
Another tip I have is to spread out your travel purchases. When planning my trip to Europe, we purchased our flights, hotels, cars, and activities over the course of the 12 months we saved instead of all at once. This meant that we always had something to look forward to and use as a benchmark for our success. As I mentioned before, us humans appreciate rewards. By booking and purchasing big, exciting milestones for your trip, it reminds you that your hard work is actually going towards something. I also found that it made the 12 month waiting period a lot more enjoyable and exciting!
STEP 5: Invest in a Travel Rewards Card
This is my last tip, but I think it’s a great one. Before my trip I applied for a Capital One Venture card, and proceeded to put all of my expenses onto it. As a result, I racked up enough points to pay for my trip to Canada last year, and am on target to pay for another trip this year! That said, credit cards are not free money. I never EVER put more money on it than I have in my bank account, and I pay it off in full every single month. If you know you cannot do that, then I would not suggest getting a travel credit card.
If you do think you are up for it, however, this is a great way to earn points and free dollars while traveling. Not to mention cards like the Venture Card boast great travel benefits like no foreign transaction fees. Last year alone I saved over $300 in fees alone thanks to my card. With my particular card, I earn 2x the miles per dollar on any purchase with no blackouts, and I earned 50,000 extra bonus points after spending $3,000 in my first three months. Pretty awesome card for a young traveler like myself!
These five steps have been extremely helpful and effective for me and I hope that they will do the same for you and your next adventure!
I’d love to hear what your favorite trip you’ve ever taken was! Mine is Ireland 🙂
Be sure to leave me a comment down below.
Happy traveling!
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