Whether you’re into exotic vacations or simply just need to get away, everyone needs a vacation once in a while. In this post, we’re going to talk about how to save for a vacation – that is save thousands of dollars in a year to go on the vacation of your dreams.
I’ll say right off the bat that you do not need to be making a ton of money to do this. We’re going to chisel away at your week-to-week life and end you up with enough money to get away from it all.
We All Need a Vacation Sometimes
Let’s face it. We all need a vacation sometimes. My wife and I travel to Aruba every other year, and we go to different destinations the other years. Airfare ends up being our most expensive cost in planning a vacation. For you, it might be a hotel or attractions.
Whatever your expenses are, you’ll want to plan ahead for your upcoming trip. That way, there are no surprises.
How Much Do You Need for Vacation?
First things first, come up with how much money you’re going to need. You can do this by looking up activities to do at your destination, the price of hotels, how much airfare is if you’re flying, and if you’re renting a car, the cost of car rentals.
You’ll also want to factor in food and souvenirs, as well as any other expenditures you’ll have on the trip.
Once you’ve figured out a number, it’s time to create a savings plan and open an account to put extra money in.
1. Open a Separate Savings Account
I would open a separate savings account for your upcoming vacation. That way, you can fully separate your money from your savings and/or your emergency fund. Make sure to use a high interest savings account, such as with CIT Bank (my personal bank choice for a savings account).
Alright! Now that your account is opened let’s talk about how to actually save money for your vacation.
Some vacations cost several hundred dollars. Others cost several thousand. Wherever you are on that spectrum will determine how much money you'll need for your travel fund. Here we go!
2. Lower Your Living Expenses
You’re going to need to lower your monthly living expenses. Some of the most common ways to do this include:
- Negotiate your cable/internet bill: Most providers will lower your rate to their introductory rate if you call them and tell them you feel that you’re paying too much for internet, that you’re considering leaving for another provider, but that you’d like to stay a loyal customer. We saved $240/year doing this.
- Negotiate your auto insurance bill: Go to The Zebra and look up competitors’ auto insurance rates. If you find one better than yours (you probably will, by the way), call up your provider and ask if they’ll match it. If they don’t, you could consider switching to the less expensive provider. My wife and I saved $480/year by switching to Progressive.
- Reduce your mobile phone plan: If you’re not using all of your phone’s features, such as unlimited data, downgrade your plan, or, if possible, go to a provider with a better rate. In 2019, we switched from Verizon to T-Mobile and saved over $360/year.
- Cancel subscriptions that you aren’t using: I’m guilty of having a handful of subscriptions I stopped using but kept paying for. After I eliminated subscriptions that I didn’t need, we saved over $700 per year.
While my results will vary from yours, you can see already that I saved around $1,800 so far, just by lowering my living expenses. We’re going to keep this up so we can save more.
Use the app Trim to negotiate your bills automatically. This app is great if you don't want to go through the hassle of dealing with your service providers. My wife and I saved over $1000 a year using Trim for 30 minutes.
3. Cut Back on Spending
Now, you’ll want to cut back on spending so that you can save each month. As vacations are generally extravagant trips, you’ll probably spend money having a blast. And you should! So, let’s save some money in the meantime.
A great way to save money is to cut back on eating out. If you eat out one less time per week, you would likely save around $20/week if you’re cutting out dinner and around $10 per week if you’re cutting out lunch. The $20/week adds up to $1,040 a year in savings. Nice!
You could also do a “Save $5 a day” challenge and put $5 a day into your vacation account. Saving $5 a day will net you $1,825 at the end of one full year. It’s hard to argue with that.
There’s many other things you can save on as well, but I find that if you find anything that nets you around a $5 a day savings or more, then that’s perfect.
4. Get a Side Hustle
Need more cash? Get a side hustle. There are so many things you can do when it comes to side hustles. Check out some of the top side hustles you can do in 2020 here. I’ll highlight a few:
- Complete surveys online: Swagbucks is an excellent way to make a few dollars a day for filling out surveys. My friend uses Swagbucks to pay for his bus fare. You could do something similar but instead, bank the money into your vacation fund.
- Drive for Lyft: If you live in an area that lacks mass transit, or an area that’s very busy, you can make a lot of money driving for Lyft. The average reported earnings are around $17.50/hr if driving is your thing.
- Clean houses/yards: Hire yourself out as a house cleaner. Do you have neighbors who need some help around their house or yard? Mow the lawn, shovel snow, rake leaves, tidy up, vacuum, dust, etc. We pay our snow guy $20 to clear the driveway and porch. It only takes him 20 minutes on the average snowstorm, so he’s essentially making $1/minute.
5. Travel During the Week
Now that you have money saved up, you’ll want to plan your trip accordingly. If you’re flying, you can save a ton of money traveling on Tuesdays and Wednesdays primarily.
In fact, for us traveling to Aruba, I found that a Wednesday ticket was approximately 60% of the full price of a Saturday ticket. So, for two tickets, we saved hundreds of dollars just by traveling during the week. The airport was also much quieter, which is always nice.
If you’re traveling by car, traveling during the week can also be easier because most people are at work and not on the road. Simply avoid rush hour as best as you can.
6. Consider Looking Into a Travel Agency
If you’re unsure how to arrange your vacation, you might want to hire a travel advisor. Paulie and Sandra Wimbert from Forward Momentum Travel says that the $3,000 you’ve saved can take you far!
Furthermore, Paulie and Sandra state, “Consider a fantastic week-long all-inclusive Caribbean vacation for two (air, hotel, food, and drinks!) in Mexico, Jamaica, or the Dominican Republic. If you’re in the mood for a more exotic destination, that same $3,000 can take you to Morocco for a week of food, culture, and history, and still leave money in your pocket.”
Forward Momentum Travel is run by Sandra, my longtime friend, and her husband, Paulie. They travel the world together and help others do the same. I personally recommend checking them out if you’re looking to travel and aren’t sure how to set it up yourself.
Whether you’re looking for a guided adventure tour, a custom journey, or a group travel experience just for women, Forward Momentum Travel will plan it all for you.
You can also find Foward Momentum Travel on Facebook.
Wrapping It Up
By now, you should have the capacity to save for almost any trip you desire after a 12 month period. Whether it’s a getaway in the mountains, a Caribbean island escape, or anywhere in between, you deserve a vacation once in a while, so save up and go have a blast!
Where do you like to go? I’d love to hear about it in the comments below.