In 2004, my family went on an epic summer vacation that has become a tradition that now happens every other year. It all started with a tent trailer pulled by our old Jeep trekking along the beautiful California coastline, camping along the way until we reach Crescent City. We have since ditched the tent trailer for the comfort of cabins, but the trip is basically the same. We place a high value on this bi-annual trip because it provides quality family time, opportunities to be outdoors, extended periods without electronic devices, the unmatched aroma of giant coastal redwoods mixed with salt air, a lot of laughter, a way to disconnect from the normal routine of life, a reason to see the most amazing coastline on the planet, and one more thing – a vacation we can actually afford! The way I see it, nothing can ruin the glow of a great vacation faster than knowing the cost of the trip will follow you around for months. According to the 2017 LearnVest Money Habits and Confessions Survey, 74% of people say they’ve gone into debt to pay for a vacation to the tune of $1,108 on average. The survey also reports that on average Americans spend 10% of their annual income on vacations. A quarter of respondents even said they spend 15% or more.
With summer rapidly approaching, I wanted to share a few simple tips that may help you avoid going into debt, or in some cases going further into debt, when it comes to vacations:
Make It Part Of The Budget – In the same way you plan for your vacation by making reservations well in advance of your trip, you should create a vacation line item as part of your zero-based budget so that you can pay for your trip in full prior to leaving. Remember, a budget is simply telling your money where to go instead of wondering where it went. If you are not sure what a zero-based budget is, I highly recommended taking the next FPU (Financial Peace University) course scheduled to begin on September 13, 2018! You can click here to register.
Only Spend What You Have – Don’t get caught up in the moment and make foolish financial decisions on souvenirs and unplanned extras that were not in the budget. You worked hard to plan and save the money in the vacation fund, so stick to the plan. After all, how many Sasquatch coffee mugs do you need?
Eat In – Being on vacation doesn’t mean you have to eat all your meals at a restaurant. Buy groceries and keep them in the hotel refrigerator (or get a cooler) and make some of the meals in your room, cabin, tent, or even in the car if you’re taking a long road trip.
Take A “Staycation” – You don’t have to go far and spend money you don’t have to have fun and disconnect from the normal routine. Consider staying at home this year to save up for the trip you’ve always wanted.
I’d love to hear about your plans for a debt free vacation this summer …