Great news… Winter has been and gone and it’s time to bust out the BBQ and swimmers then hit the beach!! It also means, Christmas break is in a matter of months and if you want to celebrate the festive season in style then you need to start saving for your ultimate getaway.
Whether you are daydreaming about lying by the pool sipping cocktails, skiing off the snowy mountains or having a coffee on a cobbled laneway, there is one thing that each of these trips needs… MONEY!
Whether you’re the kind of person to book on a whim or a long-term planner, you have to be able to afford your trip and let’s not forget about those pesky bills to pay at home while you are soaking up those rays!
FEAR NOT… We are here to help take away the guesswork about funding your holiday vacay while you concentrate on more important things like whether you want ocean or mountain views…
Adventure and holidays are among 90% of our member’s short-term and ongoing goals, so working out how you can enjoy the ultimate holiday and still focus on your other goals is what we do best!
What’s your Magic Holiday Number?
A) Let’s start with how much it is going to cost for your getaway. Are you planning on boozy backpacking or très chic sojourning? Each obviously come with different price tags for upfront costs and daily budgets.
Budgeting never sounds like fun, but this is going to be our starting point. I would always suggest picking yourself up a copy of Lonely Planet and checking out their suggested daily costs in each country. They usually have a few different options for the type of experience you are wanting.
Or if you are doing this step on your own don’t forget to account for:
- Visa and passports
- Accommodation costs
- Wining and dining
- Flights and getting around
- Sightseeing and holiday activities
- Gifts for loved ones
- Phone costs
- Travel insurance
If traveling in a group always ask for group pricing which may be at a discounted rate.
B) We all know that even when you are gone fixed bills keep rolling in like tumbleweeds in a Clint Eastwood film. Time to dust off that spending schedule that I know you have done and see what fixed expenses will continue whilst you are gone. Always allow for an extra few days after your holiday just to be safe (you never know when the weather is going to delay all flights and you are stuck in front of the bar in paradise instead of in front of your computer in your office… how horrible)
C) On that note, it is important to include a contingency fund (sounds way more impressive then emergency fund)! Have funds sitting in an alternate account that are accessible when needed, but not too accessible that they can be used for late night cocktails! No money mogul travels without one of these bad boys. Smart planning for your finances is about planning for and expecting the best whilst also preparing for the worst.
Are you still with us? Or thinking about that cocktail?
MAGIC NUMBER = (A + B + C) less any continued income e.g. annual leave
Number of pays to save for your holiday
Where to squirrel?
There are many options as to where to allocate your holiday account whilst saving. Given this is normally a short-term goal we usually look at more liquid options, such as high-interest cash accounts or offset against non-deductible debt such as your home loan. Most home loan packages will allow you to have offset or redraw facilities so this money is working hard for you whilst you are saving for your holiday.
How to get the goods?
Keep a close eye on exchange rates in the lead-up to your trip if you are wanting to buy foreign cash or put money on a Travel Card BUT don’t forget about the exchange rate when you are bringing money home too!
There are a few different options for taking money overseas and most people will have their own preference, to note a few:
- Pre-paid card– upload money onto the card and you fix in the exchange rate
- Travel debit card– used as an everyday debit card where you can use as EFTPOS or to take cash out but the exchange is set at the time you use it
- Travel credit card- used as credit card, don’t forget you could also have interest charged on any of the funds you use
- Traveller’s cheques- go old school with a cheque that you can take overseas
- Cash/ Foreign Exchange- using foreign exchange vendors, be careful of the rate that they give you
So, as you can see there is a bit to think about when planning a holiday and MANY more options for smart holiday planning that doesn’t involve “putting it on the credit card and paying it back later.” Just think, if you get this right you will have so much more reason to relax and have no hassles when you get home so you can start planning your next adventure… New York anyone?
