Budgeting for your next holiday

posted in: Finance, Tips & Advice, Travel | 0

budget calculation

The first step is to find a holiday deal that is within your reach and you can do this on various sites such as Groupon, but what about actually saving for the holiday itself? This can be very difficult if you don’t know what you are doing, however here are some tips to reach your dream holiday..

Look at your income and any expenditure

Knowing how much you earn and how much you spend are the first and best weapons in saving the right amount for your holiday. Drawing up an Excel spreadsheet can be a really helpful way of identifying how much you have coming in and how much is going out.

Tweak your spending

Spending a little less on your normal outgoings is a great way to put more money into spending. This can be very difficult to see where to cut down, but there is often a lot of changes that can be made to spending in order to improve your saving. All you need to do is be realistic and honest with yourself about these things to identify the weak areas, perhaps you could do something like eat out once a week rather than twice.

Have a saving goal

The ideal thing to do is to save an amount of money each week that you can realistically cope with and that will not mean that essentials are neglected. For example, bills and rent or mortgage repayments should not be neglected and these should most definitely be the top priority.

Save more than you need to

Saving more than you need to is the perfect thing to do because it will allow you to cope with emergencies if they arise. A good example of this is saving for a holiday that costs $1000, that you will go on in 10 weeks time. If you save $150 a week you can easily reach your target in over six and a half weeks, but imagine that you got to the fifth week and you had saved $750, but you had a dental emergency that meant you couldn’t save anything for 3 weeks. If you keep saving $150 for the remaining weeks you will still exceed your saving goal. On the other hand if nothing happens you can have even more money to spend whilst actually on your holiday!