How to Save for Your First Vacation

If you’re in your 20s you may have never been able to enjoy spring break while in college and after you entered the real world with a full time job you may have been focused on paying off student loans before even thinking about going on vacation. Well it’s time to start thinking about where you would like to travel because with a little planning and a lot of saving discipline you (yes you) can save for your first vacation.

Here are five things to help you plan and save for your first vacation:

Research the costs

There’s really no point in saving if you don’t know how much your dream vacation is going to cost. After you decide where you want to go the next step is to start planning a.k.a. research the costs. Saving to save is a good start, but saving towards a goal is much better. It gives you something tangible to work towards and watching your balance increase is motivation to keep going.

When researching it’s important to factor in the costs to get where you want to go, the total price including tax for the accommodations, food and spending money. Always give yourself some fun money wiggle room because it’s very hard to plan the costs of a vacation down to the very dollar.

Find the best travel dates

If your dream vacation is a little bit out of your price range you don’t necessarily need to change the location, maybe you just need to adjust your travel dates. The summer is generally expensive to travel to beach destinations, whereas it’s not too expensive to visit a city. Although the prices constantly change you can find a four-star-hotel-room in New York City in July for around $135 per night on Priceline.com. That’s an amazing deal.

The other option is to search prices for different travel days of the week. If you originally researched a round trip from Friday to Friday, you may want to compare prices if you were leaving on Sunday. Sometimes a few days can make a big difference in the cost.

Set a daily spending budget

Some people take a wallet full of cash when they travel and once the money is gone they have to stop spending. That’s O.K., but is it really how you want to save for your first vacation? A better option is to give yourself a daily spending limit for various categories such as food, transportation and fun stuff.

This way you’ll know when to spend, when to splurge and when to save. The last thing you want to do is be on day four of a seven-day vacation and be out of money. Setting spending limits helps ensure you always have cash.

Open a new savings account

Saving for your first vacation may take several months or even years to achieve depending on where you want to go and how much it will cost. It’s a good idea to start saving with automatic transfers from your checking to your savings account. This helps you track your progress and as you get closer to your overall savings goal you can start booking your vacation. How exciting is that?!

Don’t forget travel insurance

One thing that people often forget to add into their overall vacation budget is the cost of travel insurance. Shop around to find a good deal and be sure you have all the coverage as well as contact information before you leave.

The last thing you want is to be injured in a foreign country and not have the phone number for your insurance company. That wouldn’t be an ideal situation. When it comes to travelling abroad it’s always better to be safe than sorry.

Photo: Flickr: tdlucas5000