Episode 5: Saving and Budgeting for Travel and Vacation

We have all had a vacation when you come back and you wish you had another vacation because you are so exhausted.  Or the kind where you are immediately stressed once you get back because now you have to figure out how you are going to pay for the supposed relaxing vacation you just took.  

  Vacations should be relaxing and enjoyable.  The best way to do that financially is to budget all year long for your vacations and travel and pay with cash.  After you get back, it is so rewarding and you feel so accomplished knowing that you don't have to worry about coming up with the money as fast as possible to pay off your credit cards.   Here is the step by step simple way to budget for all your vacation and travel.  (Side note: it doesn't have to be perfect)

1.  Make a list of all the vacation and travel you are planning in the next 12 months.  List all associated costs (flight, accommodations, excursions, food/ drinks budget, etc)
2. Total up your costs to one grand total and divide by 12.  This is how much you are going to need to budget and save every month.
3. Use an online bank like www.capitalone360.com or www.ally.com to create savings funds for each vacation.  These link directly to your checking account.
4. When it is time to plan your vacations, you can only use what is in the savings account.  
5. Bring cash with you and use it as much as possible.  If you are international and don't feel safe using cash you can use a card but you tend to spend more because you can't see the money in front of you.  
6. Come back relaxed and de-stressed, not having to worry about paying for your vacation after the fact

This week’s topics: 

• ITT Tech shutting down
• We recommend Kayak, AirFareWatchdog, Costco (if you have a membership), google.com/flights.  
• Financial Rule of Dumb: Your mortgage payment shouldn't be more than 25% of my take home pay
• Listener Question from Dev: Using credit cards to get the points and paying it off at the end of the month
• Saving and Budgeting for Vacations and Travel
• Carmen’s Corner: What to do when kids are gifted money for holidays and birthdays
• And much more….

 

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