In an earlier blog article, we offered tips on ways to stretch your vacation dollar and save during your getaways. But to truly maximize your savings and value on a vacation, the process should begin well in advance — starting with setting a vacation budget.
Having a budget in place before you hit the road can help you better anticipate your upcoming expenses and keep them in check, and it can help keep you from spending more than you can afford during your getaway. To help make yourself more financially aware and savings-savvy on your next vacation, consider taking these seven steps to create a vacation budget in advance:
- Estimate your expenses — Once you’ve determined your destination, do the research needed to uncover what your trip’s costs will entail. Be sure to account for all the major categories — including airfare, gas, lodging, any needed vehicle rentals, attractions, food, snacks, etc. — and prepare estimates for what each one will cost.
- Don’t forget the hidden costs — Once you’ve accounted for the big-ticket expenses you’ll incur on your vacation, take a few moments to think through any “hidden costs” that your getaway may entail. Will you need to pay for any pet boarding while you’re away? What about checked-bag fees, roaming fees for your mobile phone, tips for meals and other services, parking fees and tolls, taxi or other transportation fees, and souvenirs? Add all of these estimated costs to your total trip-cost estimate.
- Build in some backup funds — The estimated dollar amount that you’ve calculated above should serve as a good guideline for trip-budgeting purposes, but you’ll want to build in some wiggle room. Come up with a reasonable amount of “fun money” to spend during your vacation, and factor in some extra funds to serve as a buffer to cover any costs you may have missed above. Add this figure to the trip-cost estimate you’ve been working to calculate.
- Set a maximum spending amount — With your income and anticipated amount of discretionary funds available in mind, set a maximum amount that you can afford to spend on your vacation. This will serve as the benchmark for your vacation spending, and by aiming not to exceed it, you can help ensure that your vacation won’t leave you with credit card or other debts that you’ll still be paying off long after your trip is over.
- Adjust as needed — If the trip-cost estimate you’ve calculated is simply more than you can responsibly afford to spend on a vacation, you may need to make some adjustments to make your trip more affordable. Can you create savings and bring your trip into budget by shortening the duration of your trip? What about by finding cheaper lodging options, staying with friends or sharing a vacation rental with friends? Can you cut down on some of the meals out that you’ve planned by shopping for groceries and making your own meals? Or can you cut your costs by finding free-of-charge activities in your destination rather than going to high-priced tourist attractions? Whatever you need to do to cut costs, from a budgeting and post-trip debt perspective, it’s better to rein in your trip spending to levels that you can afford than to run up bills that could continue impacting your pocketbook long after the vacation is in the books.
- Be on the lookout for bargains — Even after you’ve made your bookings, there’s often still time to save. As the date for your trip departure draws closer, keep an eye out for better rates — especially on major expenses like airfare, lodging, car rentals and attraction admission. Many of these bookings can be canceled or changed without any penalty fees if it’s done early enough. And even if making changes does incur fees, in some cases, the savings brought by the deal you’ve found can outweigh the change costs.
- Stick to the plan … and have fun! — For your budget planning to work as intended, you’ll need to stick to the plan while you’re on vacation. Try to limit your discretionary spending to the “fun money” you factored in while creating your budget, and avoid additional over-the-top indulgences. But don’t let your budget concerns keep you from enjoying your vacation. If you keep any added splurges within reason, you’ll be able to avoid bringing substantial debt home and have a fun-filled vacation that you and your travel companions will never forget!
Proudly serving South Carolina since 1933, Arthur State Bank offers accounts and services to meet a variety of financial needs. To help you achieve all your financial goals, the bank offers in-person service as well as a range of convenient digital banking solutions. To learn how Arthur State Bank can help you with banking needs ranging from checking and savings to retirement accounts, mortgages, other personal loans and more, visit arthurstatebank.com.