How to Make a Savings Plan for Holidays
Follow These Steps!
This post is a bit boring. There is no Great Wall of China, no tropical beaches, no desert oasis and no cute little monkeys from South East Asia. This post is about how to create a savings plan for holidays.
At the end of the day, it all boils down to minimising debt, being super strict with spending and making travel your spending priority. If you are new to travelling, you may be surprised at how cost-effective some destinations are and how little you need to put away each week.
See my post on budget travel with kids!
STEP 1 – Work Out Your Income:
Write down all of your income as a weekly amount. Even if you get paid monthly, write down a weekly amount.
STEP 2 – Work Out Your Weekly Expenses:
Write down all of your regular expenses as a weekly cost. You need to include EVERY expense, including small things like coffee purchases. I know they only cost a few dollars but they REALLY add up.
Don’t kid yourself about how much you smoke, eat takeaway lunch or subscribe to streaming services etc. Otherwise, this process won’t work!
STEP 3 – Work Out Your Monthly and Yearly Expenses:
Write down all of your monthly and yearly expenses (such as insurance premiums or car registration), and convert them to a weekly amount. Add them to the list you started in the last step.
For e.g. my car registration is $680 per year, so I need to set aside $13.10 every week for it in a bank account if I am to afford the bill.
Do this for absolutely EVERY expense, including an amount for Christmas and birthday presents. This step is really crucial because it’s these kind of expenses that quickly eat up any holiday savings you might have.
STEP 4 – Analyse and Work Out Your Surplus:
Add up your expenses from step 2 and 3, and compare this total to your weekly income. If you are spending more than you earn, then obviously you need to change your lifestyle ASAP.
If on paper, you have $30 leftover every week, start saving it now and stop wasting it! After 12 months, this would equal $1,560 which is enough for a luxury weekend away or a great package deal somewhere awesome.
STEP 5 – Start Saving:
Open a bank account for holiday savings and make sure there is no card attached. You don’t want to be able to access these funds easily. Every week transfer your regular holiday savings amount into it as SOON as you get paid. If you don’t do this straight away, I guarantee it won’t be there at the end of the week.
Endeavour to save more when you can. For e.g. if you have a weekly shopping budget of $170 and only spend $150, then you have another $20 you can save that week.
STEP 6 – Review:
Repeat Steps 1 – 4 every few months to ensure you are on track.
STEP 7 – Be Strict With Steps 1 to 6.
This is the hard part. However, unless you are loaded you will need to make travel savings your priority until your goal is reached. Ask yourself before you buy anything, “do I really need this? or do I just want it.”
Need Some Family Holiday Inspiration?
For more information on great places to visit as a family, head on back to the home page for inspiration on destinations and activities worldwide.
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