How To Save For Your Dream Vacation This Year

No matter where you are with your finances, I am sure you are thinking about how to save for a vacation this year as most people do after working hard all week.

When you are trying to stop living paycheck to paycheck the last thing you think you can afford is a vacation.

The good news is, of course you can!

You can do whatever you set your mind to and I’ll help you see how to save for a vacation even on a tight budget.

How Much Do You Need For A Vacation Calculator

To be successful in saving enough money for your dream vacation you need to start with the end in mind and calculate the total cost.

What vacation is it you are dreaming of?

Do you just want to take a relaxing break with the family, location not too important, or have you got your heart set on a warm, tropical island somewhere?

The answer to the question, how much do you need for a vacation, is very much dependent on your vacation dream of course.

So the first thing you should do is work out and calculate one of two things. Either:

  1. How much are you willing to spend (in total) on one holiday? or
  2. Where specifically do you want to go on vacation this year?

Specific Vacation Plan

When you have a specific vacation in mind then you can break down the costs of this vacation. Costs that may include:

  • Flights & transfers
  • Car hire, insurances and petrol
  • Accommodation
  • Food and drink
  • Entertainment & excursions
  • Holiday insurance
  • Special clothing & equipment if relevant (e.g. ski wear)

Doing your research now will really help you focus on achieving your holiday goal and help you make decisions on what you want in your holiday and perhaps what you don’t want or need.

beach with wave lapping at edge of sand

Willing To Spend Plan

There is less work involved if you choose to set a budget for the total cost of your holiday.

However you do need to factor in whether you are being realistic with your budget and what you can get for it.

I once decided to set my goal at £2,000 for a family of 4 to go to France or Spain (just a short hop from the UK) in the school holidays.

I plucked that figure out of the air as it was a lot of money for us, a huge amount of money.

Unfortunately, £2,000 doesn’t go very far if you are looking to fly and stay in a hotel for 2 weeks.

However, we couldn’t afford more without taking on credit card debt so we stuck with our vacation budget and became flexible with what type of vacation we had.

We still went to France and had a fabulous time staying in a mobile home having driven there instead of flying.

Setting a budget without an exact holiday in mind is a good way to achieve having a vacation on a tight budget.

Make the savings and fit your vacation plans around the money you do have, rather than worry about money that you don’t have.

Vacations are very flexible things.

You can go camping, hiking, stay in a mobile home, a hotel, self catering accommodation, fly, drive, or take the train.

Have two weeks in the sun, a week, 10 days, 5 days.

There is a vacation to suit every budget so set your budget and let’s start saving!

Come and follow me on Pinterest for more money saving hints and frugal tips!

(This post may contain affiliate links. If you click on a link, I may make a small commission at no extra cost to you. You can read more here)

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Why You Should Save For A Vacation

For me, the most important thing you get from your vacation is time to relax and unwind from the stresses of daily life.

You cannot achieve that relaxation if you have gone into debt to get that holiday.

The stress of knowing you have (more) debt to pay off once you get back home can be a real damper on your relaxation time.

So my number one tip for you is don’t pile stress on yourself.

Do whatever you have to do to save for your vacation, but don’t go into debt. It’s not worth it.

How To Save For Your Dream Vacation This Year

Ring Fence Your Vacation Savings

You need to open a separate savings account for your vacation money.

Having it in a separate pot allows you to see it build up and know when you are close to achieving your goal or whether you need to do a bit more to do so.

As your holiday money is for this year, you’ll need an easy access account for your money.

Choose the account with the best interest rate as long as there are no penalties for withdrawing your money.

If you lump your vacation money in with any other savings you have, the total sum gets lost.

You want to see clearly what you have saved so far and how much you still have to save to reach your vacation goal.

Automate Your Savings

You probably see this advice on every article about how to save money. The simple reason is that it works.

Set up a regular schedule so that your savings get taken from your main account as soon as you get paid.

The money is safe away from your usual spending pot and there is no temptation to dip into it.

Re-do Your Budget

If you already have a budget and every penny is accounted for then you’ll know that in order to find more money to save something has to change.

Your budget is an important step in learning how to save for a vacation.

Tweak your budget, find a few pounds here and there, make some changes to free up your holiday cash.

Because it is for your dream vacation, you will be willing to make these budget tweaks.

derwent water reflection - how to save for a vacation


Put Your Vacation On Your Priority List

When you are on a budget your money will only go so far.

If you can’t have it all (and who can these days?) then choose what is important to you and allocation your money accordingly.

Your vacation is important, more important than eating out once a week, so make those choices and save the money for your vacation instead.

How To Save For A Vacation – Earn Extra Money

Sell your Unwanted Stuff

When you are trying to save for a vacation on a tight budget, sometimes cutting your budget is not enough.

If you have unwanted items in your home, why not give them a new home and earn a little money in the process?

You can sell your stuff on places like:

  • Facebook
  • Gumtree
  • Craigslist
  • Ebay
  • Preloved

Earn Money From Your Hobby

If you have a hobby that you enjoy, you may be able to make some extra money from it.

Ring fence everything your hobby earns you for your vacation fund. You can read more about hobbies that can make money here.

paintbrush and carpet of flowers how to save for a vacation


Pick Up An Extra Job

There are often part time, small jobs that are available that you could use to top up your savings. Jobs such as bar work, waiting tables or care work.

Alternatively there are jobs you can do from home.

These 3 jobs are an excellent way to set your own hours, work from home and earn decent money:

1.Freelance Writer 

Freelancer writers get to work from home, in their pajamas, at a time of their choosing.

Everything you read on the internet is written by someone so why not you as a way of making extra money for your dream vacation?

Gina has a great post on how to become a freelancer writer broken down into 7 easy steps including where to look for your first jobs.

Gina started her own freelance writing business in her spare time and within a few months was earning more than $4,000 a month.

If you like writing but are not sure what you would write about then why not download Gina’s list of 200+ freelance writing niches?

2. Proofreading

As a proofreader your role is to find the mistakes on things such as novels, newspapers and cookbooks.

You get to work from home and choose your own hours so proofreading can fit around your existing commitments.

Find out more about proofreading in the FREE 76 minute workshop that Caitlin Pyle runs.

Caitlin provides advice on how you can start your own quality proofreading business and how to find proofreading jobs and your first clients.

3. Virtual Assistant (VA)

A VA is basically an online assistant, organizer and support and typically works for small businesses, entrepreneurs and bloggers.

Anything that can be done online could be completed by a VA from anywhere in the world, including your front room.

Gina Horkey has a FREE ebook detailing more than 150 services you can offer as a VA.

Why not have a read of this free ebook and see whether you could be earning money for your dream vacation as a VA from home?

coin piles and a piggy bank how to save for a vacation


Make Your Home Work For You

Here in the UK we can earn up to £7500 each year tax free with the Rent A Room Scheme.

If you have a spare bedroom you could rent it out to students, contractors or anyone else on a short term or longer term basis.

Alternatively you could earn money renting out a room through Airbnb.

If you live in a city or somewhere with restricted parking you could also earn money renting out your driveway.

I’ve used JustPark to rent someone’s driveway when visiting London. For as little as £5 it saves me the congestion charge and driving into central London.

Use Credit Cards To Earn Air Miles Or Cash Back

If your dream vacation involves flying then using a credit card that rewards you in air miles or free flights is a no-brainer.

Plan your spending so you use that card for everything.

Cash back credit cards can work in a similar way. Spend on those cards, watch the cash back grow then use every penny towards holiday essentials.

Pay With Cash

I’m a great believer in getting cash back from your credit cards wherever you can.

However I also know in my heart that I spend slightly more money when I use my cards more.

Using the cash envelope system gives a really good focus on your money and how you spend it.

If you haven’t got loads of wriggle room in your budget but are desperate for a vacation then consider using cash for a couple of months to help you ramp up your savings.

pennies and coins moving into a piggy bank - how to save for a vacation

How To Save For A Vacation On A Tight Budget

When you already have a tight budget, saving money just gets a little harder and you have to be a little more creative.

So how do you save for a vacation on a tight budget?

You focus on every little aspect of your money.

Cut Back On Your Grocery Budget

We often have a little wriggle room in our grocery budget so this is an area you could put more focus on to realize some savings.

Focus on bulk buying, cheaper frugal meals and cutting back on a few of the treats that often up in our trolleys.

  • Skip drinks when you go out – water is good!
  • Reduce your utility costs – turn the thermostat down, line dry your clothes, wear an extra layer.
  • Track your spending so you know where every penny goes
  • Aim to focus on your needs, not a bunch of your wants (your vacation is your big want)
  • Always live below your means
  • Keep your loose change
  • Reduce your car use – walk more
  • Pack your lunch
  • Have friends round for supper instead of having a meal out
  • Cut your entertainment budget – rent DVDs instead of going to the movies

Remember every penny counts.

young family walking on beach - how to save for a vacation

How To Save For A Vacation In 4 Months

Saving for a vacation in 4 months is totally possible but you have to consider a couple of things.

  1. be realistic about the vacation you are planning, and
  2. you might need to go down the extreme frugal living route to make it happen.

There is absolutely nothing wrong with being extreme in your money saving.

If you are adamant you want that vacation in 4 months then you will be prepared to do what you have to do in order to achieve it.

How To Save For A Vacation Every Year

If you want a vacation every year (and who doesn’t?) then the best thing you can do is to save for that vacation every month.

Build your holiday into your core budget. Treat it as one of your essential bills and build your spending around it.

I hope you have a fabulous vacation!

Pinterest image of blue water - how to save for a vacation

Last Updated on 5th April 2023 by Emma

About Emma

I'm here to help you become confident in making the best money decisions for you and your family. Frugal living has changed my life, let me help you change yours.

2 thoughts on “How To Save For Your Dream Vacation This Year”

    • Hi Alice! Seeing it build is so motivating isn’t it? That’s why I am a fan of different accounts for different savings goals. Makes the growth very visible and keeps you on track. Thanks for reading!


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