What we'll cover
Factors that influence the cost of a vacation
How to save for a vacation
Ways to maximize your savings
Whether you’re a camper, theme park enthusiast or international wanderer, there is nothing quite like getting away for a vacation. Separating yourself from the stresses of daily life can give you the reset you need and the adventure you crave.
But we all know taking a vacation isn’t as simple as packing up and leaving whenever you want. And while vacations seem to fly by in an instant, the planning and (most importantly) saving for these breaks can feel like they take an eternity. Saving is an essential piece of preparation, but that doesn’t mean it has to take forever. With a few financial hacks and creative saving, you can get to your next trip a little ahead of schedule.
Create a budget for your vacation
First, you need to determine how much your trip will cost. You can take a number of approaches to create a budget for your vacation. Whatever your style, remember to distinguish your wants from your needs. You may have more control than you think over the price of your trip, depending on when, where and how you travel. Consider scheduling your trip during the off-season for lower airfare and hotel prices. It’s all about priorities and balance.
If you have an action-packed itinerary and your hotel will just be a place to sleep between adventures, you could save by booking lower-priced accommodations. Then again, maybe a beachfront view is a must, but you’re happy to make some of your own meals to save money. Identify what matters most without cutting back on your enjoyment.
If you have an action-packed itinerary and your hotel will just be a place to sleep between adventures, you could save by booking lower-priced accommodations.
Set a savings goal
After you establish a budget, it’s time to start stashing cash in your vacation fund. Set a realistic goal and begin saving.
Automate your savings
Setting aside money for your vacation is easier when you put it on cruise control. Consider automating contributions to your savings account by setting up recurring transfers. The faster the funds hit your account, the faster it will start earning interest.
Use buckets and boosters
Take your savings to the next level with buckets and boosters. These smart tools help you optimize your savings to reach your goal that much faster. Set up a vacation bucket in your Ally Bank Savings Account to dedicate funds specifically for your trip.
In addition to recurring transfers, there are two more boosters that could help you save – round ups and Surprise Savings.
Round ups
With round ups, each purchase you make is rounded up to the nearest dollar and automatically transferred from your checking account into your savings account once you’ve accrued at least $5.
Surprise Savings
Surprise Savings analyzes your spending to find areas where you could save more and then moves those funds to your savings account.
You’ll be surprised by how quickly those small deposits add up.
Utilize cash-back reward credit cards
Planning for a vacation is the perfect time to cash in on reward credit cards. If you have a good credit score, these cards can be a great financial asset for travel. When it comes time to book transportation and accommodations for your getaway, you can use points and rewards. Do your research to determine the best method.
Keep in mind caveats like blackout dates or limited seat availability on flights. Compare points redemption cost to the regular booking price to make sure you’re getting the best deal.
Explore new ways to earn
If saving isn’t getting you to your vacation goals fast enough, finding new sources of income could be the answer. Consider taking on a side gig to fund your goal. Seasonal part-time work, online ventures, delivery services, rideshares, and even crafting can help you pull in extra income when it’s convenient for you.
And don’t forget about any clothes or household items you have and don’t use anymore — chances are, these could find a new home. If the thought of a yard sale gives you anxiety, there are numerous websites and apps that offer the opportunity to safely and quickly sell pre-owned items.
Cut back on expenses
To afford your trip, consider lowering other costs. Cook more at home to save up on restaurant meals while on vacation. Or maybe you’ll spend less on nights out on the town to splurge on a truly memorable experience on your trip.
Don’t forget that some of your normal expenses will naturally pause while you’re away. For instance, you don’t need to plan for grocery shopping in your budget for the time you’ll be out of town. Consider skipping a month of your gym membership or suspending some of your streaming services for the time you’re away. You could even consider subletting or hosting a vacation rental if you’ll be away for a few weeks. Finding small ways to save on your home expenses could boost your vacation budget and keep your finances on track while you travel.
Look for ways to earn and save more
Sometimes you just need that extra little push to get you to your goal. Can you pick up extra hours at your job, start a side hustle or explore ways to earn cash from home? From cleaning out your closet and selling your old clothes to virtual assistant gigs, look into the many options for extra income that will go a long way toward your vacation.
Bon voyage!
Waiting for vacation while you save up can make it feel like time is crawling. Planning ahead, setting a budget and finding new ways to save can help you go where you want to go and do what you want to do even sooner.
