Last Updated on 14th July 2020 by Tuppenny
We all love a good vacation don’t we?
Those precious moments when you can forget about office politics, family strife and the government of the day.
But unless you create a vacation savings plan, those precious moments could mean you going into debt to get them.
Your vacation time is something to look forward to when your nose is to the grindstone and your boss is demanding ever more from you.
Without a financial goal to save for your vacation you will not be able to fully relax as the prospect of more debt will hang over you.
What Is A Vacation Savings Plan?
Planning your next vacation really needs to start with your vacation savings plan.
A plan where you know what you are saving for and how much you are going to need to save.
Having a weekly plan of how much to save will really help you ramp up your savings and achieve your vacation goal.
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How Much To Save?
How do you know how much to save for your vacation? Well, you could just pluck a figure, say $2,000, out of the air and aim for that.
Alternatively you could work out how much you can afford to ring-fence into a vacation savings account.
Over a given period of saving e.g. 12 weeks, 6 months or 12 months, you’ll know how much will be in your vacation savings account because it will be your weekly payment x 12/6/12.
Saving for a vacation is different for everyone.
You might want a 5* all inclusive resort holiday whereas your neighbor might be aiming for a week of camping near the beach.
So one savings plan does not necessarily fit all.
Having a visual reminder of how much you want to save and why is a great way to keep you on track.
To help you achieve your savings goals I have created 4 different savings goal trackers for you.
Two 12 week travel savings plan for this years vacation. A 26 week tracker and a 50 week savings plan.
You can find them and download them from my free resource library.
Wait! What’s A Vacation Savings Account?
If you are ring-fencing some of your hard earned income to save for a vacation then your best plan is to put it into a separate savings account.
That way you know everything in that account is your vacation fund.
And it’s great fun to watch it grow each week and month.
Choose a savings account that you can access when you need the funds and one where you can earn a little bit of interest.
The more interest the better but the key feature of your vacation savings account is that you can get to your money whenever you need to.
You’ll be using it to pay for things like flights and accommodation long before you actually jet off on holiday so flexibility is key.
When To Start A Vacation Savings Plan
So when should you start your vacation savings plan? If you plan on having a vacation every year then you know you need to save for it every year.
My personal preference is to save into my vacations savings account 12 months of the year.
The advantages of doing this is each weekly or monthly payment is that much less as you are saving all year round.
If you want to start a vacation fund right now for this years vacation then why not focus on a 12 week travel savings plan?
If you save hard for 12 weeks it will give you a decent amount of time to build enough money for a vacation.
To help you get started with your savings I’ve created two 12 week travel savings plans that you can download for free from my resource library.
Saving For A Vacation On A Tight Budget
Now it’s all very well me saying you can save $1000 in 12 weeks but if you don’t have a lot of spare cash how do you do that?
Saving for a vacation when you are on a tight budget is totally doable but requires good planning and decision making in order to be successful.
Even when we were broke, Mr2p and I were determined to have some form of vacation each year.
Sometimes it was 7 days of camping in England or perhaps two weeks in a French hotel.
Because we wanted that holiday we had to be prepared to tweak our budget to make it happen.
When you don’t have a lot of spare cash, having a budget and incorporating vacation savings into it is the only way you will achieve your goal without going into debt.
Our monthly budget has savings built into it as an essential line. It’s up there with paying our utility bills.
Now obviously, if we had a crisis and needed to implement a survival budget then savings of any sort aren’t going to happen.
But we have a rainy day fund so for small or one off crisis’ we would turn to that pot of money.
Losing your job is a different form of crisis, hence having a separate survival budget for times like that.
Saving for a vacation when you have a low income or limited funds requires you to prioritize your money.
Do you want a holiday more than new clothes or going to the movies?
If you do, reduce your spend on those and increase the money you pay into your vacation savings account.
Tips to help you save when your budget is tight:
- Automate your savings – get the money into your vacation savings account as soon as you are paid
- Prioritize your vacation above other non-essential items
- Cut back on your grocery budget
- Track your spending so you know where your money is going
- Use the cash envelope system to make your spending more real
I’ve written a whole post on tactics and ideas on how to save for a vacation focusing on those on a tight budget.
Why not check it out for more help in achieving your savings goal?