Saving enough money to go on your dream vacation can seem daunting, especially if you’re not bringing home huge paychecks. Too many people go into the savings process half-heartedly, and become discouraged when they don’t see high gains after a few months – We’re not going to let that happen to you. Saving thousands of dollars, especially in a short amount of time can be difficult, but it’s certainly not impossible. And if you follow these tips and guidelines, you’ll be on that flight sooner than you ever expected.
1. Budget, Budget, Budget
If you’re serious about saving, you’re going to have to embrace the concept of budgeting. Before you actually start saving, spend a month meticulously documenting all the money you earn and spend – every single penny should be recorded. Once you know exactly how much you’re making and spending in an average month, it’s much easier to set your goals and get started.
2. Set Goals
This step is just as important as budgeting. If you have a vague idea of how much money you’ll need to save to go on your trip, your savings will falter. Do some research to find ticket prices, hotel prices, average cost of living, etc, in the places you want to stay and visit. Calculate the bare minimum you’d need to save in order to take the trip according to your comfort level, then add more to the budget for “padding” and discretionary funds when you’re there – it’s always better to have a bit too much money rather than not enough! This is also a good time to set a timeline. Think about when you’d like to go on the trip, but be realistic
3. Budget, Budget, Budget — Again
Now that you have a record of your spending and earning, go through it all and mark each of your “unnecessary” purchases. This is what’s going to help you the most – cutting your expenses in daily life. If you want to save a lot of money very quickly, you’ll have to change your lifestyle – no more Starbucks, take-out meals, spa days, gym memberships, magazine subscriptions, etc. It’ll be hard, but totally worth it. Calculate how much money you’ll need to spend each month on rent, utilities, food, bills, and transportation – that number will be your new spending goal.
4. Set Up a Dedicated Savings Account
You probably already have a general savings account. Don’t use it! Instead, open a new savings account that will be reserved for travel money, and travel money only. This will make it easier to keep track of exactly how much money you’ve saved up, and exactly how much you still have to go.
5. Set Up Automatic Transfers
Remember your savings goal? Allow yourself only that much money per month, plus maybe $50 for unexpected purchases. Have the rest of your earnings automatically transferred into your travel savings account. Example: Say you receive two paychecks a month, each for $2,000, and your bare-bones spending goal per month equals $1,000. Set up automatic transfers that seamlessly deposit $1,500 into your travel fund and $500 into your checking account each paycheck. It might be tough to severely limit your spending so quickly, but if you convince yourself that the extra $1,500 is money that you “don’t have,” it becomes much easier. Make sure to transfer any “leftovers” to your travel fund as well. Even if you only have 50 cents left in your checking account when you get your next paycheck, put that 50 cents into your travel fund!
6. Make Extra Money When Possible
And put it right into your travel fund. In addition to your normal job, this is where you can get creative to pick up some extra cash. Are you in a position to take in a roommate? There’s an extra few hundred bucks a month. Do you have a marketable talent? Start doing some freelance work. Got a bunch of extra clothes lying in your closet, or furniture you don’t really want? Sell it. Do whatever you can do help pad that savings account!
7. Stay On Track
The most important thing to remember is that you won’t reach your goals if you’re not actively trying to. It will be difficult! But after a while of sticking to it, you’ll start to think of money in terms of travel. Sure, that $40 could buy you some after-work drinks with your friends, but it could also buy you a ferry ticket between Spain and Morocco! There will be and inevitable slip-ups here and there, but stick with the plan, and you’ll be off in no time.
Bon Voyage!
