Finding a strategy to save money for a trip can be fun and challenging. Not only is it the first step to reaching your dream destination, but it also helps you create savings habits that are useful for life. You can book your flight from Air Arabia airlines booking online.
It may seem absurd to think of saving for a trip during a global pandemic, but it actually hides some unexpected benefits. First of all, setting yourself a goal in such uncertain times can become a real source of well-being. So here’s how to start managing your money the smart way to enjoy the journey of your life in the (hopefully!) Not too distant future.
How to save money for travel during the COVID-19 pandemic
Saving money is never easy, but doing it during a pandemic comes with a number of challenges. The key is to remain flexible with your month-to-month goals while maintaining a savings approach. This way you will be prepared in case of any financial problem related to COVID-19 and at the same time, you will avoid feeling like you are failing to achieve what you set out to do in terms of spending planning.
Saving money for a trip during COVID-19 can also bring the following benefits:
- Visualizing yourself enjoying a well-deserved vacation can give you some comfort and be a source of optimism at times when the future is so uncertain.
- Setting concrete savings goals in the face of uncertainty can give you a sense of security as it allows you to take the reins of things that are under your control.
- As many countries are facing new lockdowns, the opportunities to spend money have diminished, so it’s easier to save. Nonetheless, don’t forget to support local businesses with your purchases when you get the chance.
- Setting a budget is essential in order to start saving for a trip. Since you will likely be spending a lot of time at home, you will have more control over your finances and with that the opportunity to become a savings professional.
How to save money for your dream vacation
Before anything else you need to evaluate how much your vacation will cost. This involves two things: deciding where you want to go and for how long. Once you have an idea in mind, it’s time to plan the details, in other words, estimate the costs for the following factors:
- Cost of airfare (round trip!) And travel insurance
- The cost of accommodation
- Your budget for food and drinks
- The price of any tourist activity you plan to do once there
- The amount you want to save in an emergency travel fund
Obviously, it will be difficult to make an exact assessment, but at least you will know where to start. In general, it is always better to calculate an extra cushion in consideration of the fact that you could spend a little more than expected in all the categories mentioned.
How much to set aside for a trip to Europe
If you are planning a trip to a European country, on average, you can plan to spend around € 1500 per month. Clearly, it depends a lot, often decisively, on the place you have chosen to visit. While a week in Amsterdam for two people costs on average around € 1800, for a week trip for two to Poland you can get by on around € 800 (excluding flights).
But remember: the more there is the less, so it is always better to plan a higher budget so as not to risk running out of money. There is no better cure for post-vacation blues than to come back with a few more coins than expected so you can start saving for your next trip right away.
How to put together the budget for your trip
Now that you know how much money you will need for your trip, it’s time to put together the budget to finance it. While it is true that on the one hand saving is a boring activity, on the other, it is also extremely liberating. Understanding your cash flow and adapting it to your needs will give you a sense of financial independence, which is a plus in times of uncertainty.
Track your expenses
To start putting together a budget, you first need to understand where your money goes each month; this means you need to start tracking all your expenses. Every single expense. You will need to take note of all inflows and compare them to your outflows over a 30-day period. You can do this manually by checking your bank statement and entering these figures into a table. Or, if it’s too tedious work, you can consider using an expense planning app.
Break down your expenses
This step requires you to divide your expenses into two categories: fixed and variable. Your fixed costs include all expenses that are difficult to change. These include, for example, rent, repayment of any debts and utility bills. Your variable costs, on the other hand, are all those expenses that are a little more flexible. Hence, this category includes all subscriptions (e.g., Netflix, Spotify), all unnecessary grocery shopping and shopping.
Cut your variable costs
Since your variable expenses aren’t all essential, it’s easier to make cuts in this category. To do this, there are several things you can do. First of all, reconsider the way you shop to significantly save on groceries. This could result in planning your meals so that you can determine in advance how much to spend on weekly purchases, buy food in larger quantities and avoid going to the supermarket on an empty stomach.
The next move is to cancel all unused subscription services, switch to a cheaper phone rate, and get into the habit of buying second-hand. If you like challenges, try picking a day a week when you commit to spending nothing (apart from fixed costs). These may seem like minimal savings measures, but when added together, they allow you to set aside a large sum.
Use a separate savings account
When you have started to release some cash each month, it is important to put the money you have saved into a dedicated savings account. By separating the money you save from the account for your daily expenses, you do not risk using your savings unnecessarily and will therefore be able to stay within the budget.
An even better tip for growing your savings? Automate the transfer to your savings account. Once you know how much you want to set aside each month, set up an automatic transfer each month so that you can transfer the right amount to your savings account without you having to think about it.
Track your savings goals
At the end of each month, it’s important to evaluate how easy, or difficult, it was to meet your savings goals. If you feel like you’re having a hard time hitting your goals, you might want to cut back on how much you set aside each month or identify an area where you could cut some of your spendings.
However, if you find yourself saving more than you planned, adjust your budget to accommodate the extra and try to save even more. The trick is to set yourself a savings goal that is challenging enough to inspire you to manage your finances intelligently, but not so difficult that it seems impossible to achieve and therefore demotivates you.
One of the best things about learning how to save money for a trip is that you have an exciting and challenging goal to look forward to. While it is important to set aside money for an emergency fund or retirement fund, there is no doubt that these goals are far less motivating.
As a result, it can help to wallpaper the whole house with visual stimuli to help you never lose sight of the finish line. For example, you could post photos of your vacation destination next to your computer screen, or use them as a background photo on your phone. Whenever you feel tempted to go beyond the limits you have imposed on yourself, you can use this image to get back on the right path.