Holiday is the event that everyone expects; relax from daily routine to refresh both mentally and physically. Whether it’s snorkelling on the Great Barrier Reef or going on safari in the Serengeti, your next holiday will cost money. It’s much better to save as much as you can before you leave, so you don’t rely entirely on your credit card. You don’t want to spend the next year paying off your trip debts. There are many ways to plan for holiday budget wisely. Here are some of them.
Research thoroughly, Plan early, and budget wisely
The first thing to start is to examine the financial records such as receipts and bank statement related to the holiday. By this, you will have rough ideas how much money you usually spent for the holiday. Some budgeting expert recommends to not to spend more than 2% of the total income per year for holiday.
So it will be $800 for someone who earns $40,000 per year. Setting up personal guide by the current level income is a responsible idea and can help for year-long planning. It’s critical to figure out how much you want to save and how much you can afford to put aside each month.
Making list on what you actually do and need that requires money for your holiday. By making list you are able to identify different options and ways to reduce money spent. Here is the example of holiday’s list. Add all these costs together and you have your savings goal.
- Travel money
- Travel insurance
- Sun cream and toiletries
- Travel (flights or fuel costs)
- Holiday clothes and swimwear
- Car hire (and car excess insurance)
- Holiday treats
- Food and drink
Save as much as you can
Set aside small amounts of money on a regular basis (such as weekly or monthly) as early as possible. If necessary open a new bank account dedicated for the purpose and stick to put money regularly.
Having your money set aside throughout the year not only eases some of the financial stress of the holidays but could save hundreds in finance charges if it. Be realistic, it is better to commit to a small, manageable sum than to try too hard and give up. Start small by putting spare change into a jar each week. Whether it’s a family trip to Tenerife or a romantic break in Rome, naming your goal will keep you motivated. Try labelling separate savings account with the name of your goal, or sticking a chart onto the fridge – whatever will help you keep track of your progress.
If this works, set aside a bit more on a regular basis. Consider having additional income, especially if you want a holiday that is longer period and level upgraded than you normally have.
Spare additional fund for ‘holiday’ emergency
Tomorrow nobody knows what will happen and always be prepared. By sparing additional fund for holiday emergency, again, you do not have to dig your wallet further from your main saving or even borrow from credit cards means you keeping yourself from debt. Who would want another stress after the holiday? It is best to have at least 10 percent of the money from your total holiday budget.