What is your vacation budget?

[henrikbeech]

What is your vacation budget

You are planning a vacation in London, Vacations are well-deserved treats and money shouldn't be a cloud over these precious times away.

[disneysteve]

Vacations are well-deserved treats and money shouldn't be a cloud over these precious times away.

That's very nice - if you can afford them. You don't "deserve" anything. You EARN it.

[kork13]

It may not really be the best/smartest way to go about it.... But I really don't have a "vacation" budget. I build up my savings throughout the year, and when it comes time that I'm going to take a week or two of leave, I simply go, do what I'm gonna do, and spend what I need to. I think this works for me simply because I do always plan what I *expect* to spend, then try to keep my costs under control, and I stay aware of how much I'm spending as I go. Occasionally I spend more than I mean to, often times I don't. But I figure that I'm saving the money throughout the year specifically for it to be spent on whatever it is that I want to, so as long as I keep it reasonable and don't drain my savings, it's fine. Again, my laissez faire attitude probably isn't the smartest way to go, but it works for me.... at least for now, while I'm still unmarried.

[Petunia 100]

I just had an Idea, relating to vacation budget.

In my emergency fund I have like $6k extra just sitting in cash that I was about to invest, likewise I have 2k extra in my bank account from selling and old car. Would it sound like a good idea to take the money and invest the minimum amount (probably 5k) into a cheaper income bearing fund, like http://www.calamos.com/FundInvestor/....aspx?name=CHI that provides monthly income , to use that as a method of supplementing my vacation savings. Also this fund could be sold should it be necessary for an emergency. This fund offeres 9% annual return paid monthly, I could use this to supplement instead of raising my percentage saved by 2%

any reason that using an income fund w/ extra cash and using the dividends paid NOT be a decent idea as long as I don't use the principal?

No, this fund has fund does not offer a 9% annual return. This fund may have recently returned 9% annually, but that is not at all the same thing. Next year it may deliver 10%. Or, next year it may lose 10%.

Is there any reason to not use an income fund? Yes. You may lose principal. If that is not a concern, then you're OK. If that is very much a concern, then don't do it.

Edit: Clicking on your link, I see the 9% is a distribution rate, not a total return rate. The distribution rate is not guaranteed. The fund seeks to earn high income; the fund may or may not be successful. Also, distributions (presumably from dividend payments) do not prevent principal fluctuations.

Looking at the chart they provide, I notice that in February of this year, the distribution of $.095 per share breaks down as $.0776 from income and $.0174 from return of capital. That means they sent your own money back to you. As a direct result, you would own fewer shares. In March 2013, the entire distribution was from a return of capital.

[Petunia 100]

I save a small amount monthly for my next vacation, whatever it might be. I typically have extra income twice per year, and split that up between various goals, including my vacation fund. When I have the money for the vacation I want, I take it. I take a "staycation" in the years I can't yet afford my next vacation.

[Esozh]

We were planning on dropping $5,000 to go to Thailand in October, but decided to remodel the house instead. Next year, we're budgeting $2,500 - $3,000 for a trip to Ireland as a honeymoon. Our gross is something like $130,000 - but we do everything based on net, which is $90,000. So I guess we budget something like 3.5%? towards vacation.

[karenjcarlson]

vacation budget

This is a tough one - we don't take regular vacations, but probably should. Lately, we've been spending what would be vacation dollars on improvements for our home, so we can enjoy ourselves everyday (vs just 2 weeks/year)...