How to Afford Your Next Vacation (Without Backtracking Financially)

saving for a vacation

No summer feels complete without a quick warm weather getaway. But unless you started budgeting for fun in the sun while there was still snow on the ground, there’s a good chance you might not be able to afford a vacation right now – at least not without facing a major financial setback.

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But vacations and money savvy don’t have to be mutually exclusive. If you start implementing these tips now, you might be able to afford a fabulous vacation (without the financial backslide) come the holidays. You may even be able to pull it off by the end of the summer!

Just be sure to keep these three tips in mind:

1. Plan Your Budget With Your Full Year In Mind

It’s easy to get blindsided by irregular expenses like vacations when you only account for consistent monthly costs in your spending plan.

If you want to enjoy the occasional indulgence, you have to anticipate those occasional expenses too. Which means incorporating them into your monthly budget, even if they only occur once or twice a year.

Once you get an annual estimate for all your irregular expenses, divide by 12 to determine how much you need to save each month to cover those costs when the time comes. Then incorporate that amount into your monthly spending plan.

And not just vacations, consider other irregular expenses, like weddings and the holiday season, too. Even mundane expenses, like quarterly insurance premiums, that don’t come up every month need to be accounted for.

To better anticipate these irregular expenses and avoid ‘stealing’ money from your own savings goals to cover them, consider the annual cost of all of your irregular expenses when crafting your spending plan.

If you have a quarterly expense, for example, you would simply multiply it by 4. Or in the case of your vacation planning, you would estimate the total cost of all the trips you want to take in the next year.

Once you get an annual estimate for all your irregular expenses, divide by 12 to determine how much you need to save each month to cover those costs when the time comes. Then incorporate that amount into your monthly spending plan.

To make sure you don’t preemptively spend that money elsewhere, consider setting up a separate savings account for these irregular expenses. You could even set up a dedicated vacation savings account to see exactly how much progress you’re making each month toward your next vacation.

2. Plan Your Vacation Around Your Budget, Not the Other Way Around

Once vacation savings become a part of your monthly spending plan, you’ll start to have a clear picture of what trips you can and can’t afford to take just by checking the balance of your account.

If you have your heart set on a specific destination, either wait until you’ve built up enough savings in your vacation account to afford it, or take on a temporary side hustle dedicated to your goal.

For example, if you take on two extra months of overtime now, maybe you can afford that dream Caribbean cruise in cash come October.

3. Get Savvy with Your Travel Costs

In addition to saving more, the key to financially savvy travel is finding ways to make each getaway cost less.
Here are just a few ways to hack your travel costs:

  • Leverage your network. Search your brain (and Facebook) for old friends and acquaintances that may be willing to host you (or let you stay in their houses while they’re on vacation). Bonus, they’ll probably have some great insider tips to share too!
  • Travel in the off-season. Popular travel destinations are drastically cheaper in the off-season. Think Europe in the winter and the Caribbean in the summer.
  • Travel to cheap destinations. Skip the pricey European countries in favor of those with a lower cost of living, like those in South and Central America and Southeast Asia.
  • Use your rewards. Score free or cheap flights by using credit cards that offer travel rewards. Some cards will let you use your rewards to cover hotel stays too.
  • Talk to locals. Not only do they know all the best spots, they also know all the best hacks for enjoying them on the cheap.

Remember, the more you can save on your actual travel costs, the less time you need to wait to save up for your next vacation!