Travel is never a matter of money, but of courage.-Paulo Coelho
The excuse most people give who want to travel but don’t is that they can’t afford it. I am here to tell you that you can. It just takes a bit of planning. You have to make traveling a priority and put all of your focus on it if it’s something that you want to do. Here are my recommendations on how to plan your finances for this year’s travel.
Photo by Images Money/Flickr CC
1. Compare Bank Accounts
It is on my list of things to do to compare bank accounts in January. January is when many banks offer promotions to try to get your business. Some of them will even offer cash to get you to move your accounts over to them. I would like to find a bank that offers cash back when I use my debit card. You might as well earn interest on the money you are spending as well as saving, right?
2. Have a Savings Account For A Travel Fund
Having a savings account for travel is a great way to plan your finances for travel. My goal this year is to try and improve my savings account balance. I have decided that when I receive money that I will put ten percent in my travel savings account before I do anything else. This is a great way to build a travel fund.
3. Make Your Coffee And Meals At Home
It’s so easy to spend $3 here and there at coffee shops, but did you know that if you do this every day, you can easily spend almost $100 on coffee!! What would happen if you put that in your travel fund instead? You would have $1200 at the end of the year. Eating out is also so much more expensive than cooking at home. There are so many great recipes on the internet that you don’t even have to go out and buy a lot of expensive cookbooks to get started. This is one of the greatest ways that I save money for travel and is a great way to plan your finances so that you are saving money each month.
4. Get A Credit Card That Gives You Cash Back For What You Spend
There are a lot of credit cards that will give you cash back for the money that you spend with them. I actually make more money on the money that I spend than on what I save. However to benefit from this, you must pay off your credit card balance every month. When I use my credit card, I deduct the balance from my check register as if I’ve written a check. I then have the credit card automatically deduct the full credit card balance from my checking account each month. Do not fall victim to credit card debt! So many people are in debt because they are paying interest on items that they didn’t really need in the first place. When you spend money, ask yourself if you would rather have the item you are buying or a dream trip around the world? You will find yourself spending a lot less when you think about each purchase before making it.
5. Make Use Of Free Travel Apps And Travel Websites
There are a ton of travel apps and websites that can save you money for your trip and help you plan your finances. With these apps, you can find cheap airfare, hotel rooms, and discounted meals at restaurants. Don’t forget to consider alternatives to hotel stays such as couch surfing or house sitting.
All good advice. I would add two more items.
1) Convert prices to days in your head. For example, our usual travel budget is ~$60 per day. If I am considering purchasing something that is $20 I mentally convert that to 1/3 of a day in Thailand or wherever. Is this item really going to bring me more pleasure than that?
2) Find ways to drive down the cost of accommodation. Accommodation is often the most expensive part of a trip. Look into house sitting, helpx, couch surfing etc. There are lots of options that can help. I’ve written a big long guide to getting free accommodation at http://magictravelblog.com/2013/09/how-to-get-free-accommodation/ The less you need to save, the easier you will find it to actually follow through and do it.
These are great things to add, Andrew! Thank you…
Great tips, I totally agree with the eating at home, that can save up thousands of dollars a year. I also like the idea of thinking of how much I spend in terms of how much travel I can get out of it, in addition to how much work I put into making it.
Yes, that’s a great way to look at things before spending money. Thanks Kenin for the tip!
Great suggestions! It’s shocking to consider how quickly a coffee or two day add up to a couple hundred dollars a month!
All great tips! I haven’t heard of cash-back debit cards. I wonder if those even exist in Canada. Just avoiding fees seem like a challenge sometimes.
I would add that saving on your biggest expenses can be easier and more effective. That’s the way it is for me anyway. I cook at home most days and don’t drink coffee anyway, but it’s difficult to not go out to eat when you crave stuff you can only get outside. So I don’t really restrict my eating out expenses much. It’s too tiring mentally.
Where I save is in the big-ticket items. I take public transport, which means I don’t have a car that needs loan payments, insurance, gas, repairs, etc. That’s hundreds of dollars saved each month. I also rent a room and live with roommates, which is easily $1,000 saved each month.
So true about the coffee! Especially in the US. I like to treat myself to Starbucks when I do make it back to the US on occasion, but I limit that now. It quickly adds up at $3 or $4 each visit.