2020 was a year defined by a pandemic, quarantines, shelter-in-place orders, and the cancelation of numerous social events and get-togethers. As the new year has progressed, case numbers have started to fall and the summer of 2021 has begun to look brighter. This positive outlook has people starting to come out of a pandemic-induced hibernation.
If you’re like many others, a year spent in isolation has left you ravenous for a good vacation. The only problem is, many individuals and families are also coming out of a time of intense economic turmoil. With that in mind, here are some ways to save up some cash to help you go on an overdue vacation without breaking the bank.
1. Start with a Clear Budget
The last thing that you want is to exacerbate a poor financial situation through a vacation. Instead, start your journey by either reviewing your existing budget or creating one from scratch.
As you do this, look to see if your income is currently meeting all of your expenses. Also, make sure that you’re paying down debt, saving for retirement, and meeting any other financial goals.
Finally, once everything else is in place, see if there’s any discretionary spending left over for a vacation. You can also look for areas of the budget that you can trim, such as:
- Eating out less often;
- Canceling under-used streaming subscriptions;
- Avoiding other unnecessary purchases.
If there isn’t enough left over to go on vacation just yet, that’s okay. This is an important first step in the vacation budgeting process. It allows you to ensure that everything else will be okay while you redirect other funds toward a vacation.
2. Save as You Spend
Of course, no matter how much you budget, at some point you’re going to need to start saving some cash.
One way to do this is by setting aside money out of each paycheck. If possible, designate a certain amount to save toward your vacation right in your budget. Then, when each check or direct deposit comes in, squirrel the money away. Make sure to keep it in an area where you won’t be tempted to spend it.
Another option is to use technology to help automate your savings. For instance, you can use a debit card that rounds up each transaction to the nearest dollar and puts the extra money in savings.
Credit card rewards are another great way to put your savings on autopilot. If you have a credit card with a great rewards program, use it to save for your vacation. You can minimize the expense of air travel with points. You can also funnel cashback savings toward a hotel, rental car, and so on.
Regardless of how you do it, there are multiple ways to set money aside as you count down the days before your trip.
3. Plan What You Can Early
One of the best ways to make a vacation affordable is to plan it early. By making plans ahead of time you open yourself up to multiple cost-cutting activities.
First, you have a greater selection of options. For example, if you want to travel in a certain month, planning several months in advance can help. You won’t have to worry about working around a crowded calendar. You also will have better options when booking emptier flights and hotel rooms.
Second, if you plan early, you can take the time to shop around and compare rates. You don’t have to lock into the one option that a rental car or airline has available a week before your trip. You can look for deals and cash in on early bird specials. You can also use services like Airbnb and Turo to find quality alternatives to traditional vacation needs.
4. Factor in Larger Lump Sums
Along with a slow and steady stream of savings, you can also use financial windfalls to jumpstart your vacation fund. In early 2021 there are three of these, in particular, that you can keep an eye out for:
- Your tax return: You might find that you’re getting a sizable return on your taxes this year. If that’s the case, use some of it to cover your vacation.
- Stimulus checks: You may qualify for stimulus checks, which you may not need (especially if you’re planning a vacation). If that’s true, you can use them to help fund your time away.
- Bonuses: You may be due a bonus at work or you might get a raise in the first half of the year. If this happens, use the unbudgeted funds for your trip.
Steady savings are a wise approach to vacations. However, lump sums are a great way to balloon your vacation savings in an instant.
5. Make Extra Money
If you find that all of the above activity isn’t saving enough money, you might need to find another source of income. There are multiple ways to do this, such as:
- Freelancing through a site like Fiverr or Upwork.
- Selling some of your existing possessions on Craigslist or Facebook Marketplace.
- Picking up a part-time job for a few weeks or months leading up to your trip.
In the modern, gig-driven economy, there are always ways to make money online if you’re willing to look for them.
There are many ways to help make your next vacation an affordable affair. Start with your budget to confirm that the trip isn’t going to throw a wrench into your finances. Then, look for ways to start saving cash. This can include making budget cuts, shopping for deals, setting money aside, and picking up some side work.
The important thing to realize is that it isn’t the specific form of savings that will make the difference. It’s being proactive. Try to start addressing the cost of your vacation now. That way you won’t have to deal with an unpleasant financial fiasco the second you step off the plane when you arrive home.