- Date : 01/03/2020
- Read: 4 mins
Go backpacking across Europe or immerse yourself in the diverse culture of Asia! Follow these tips to create a fund for your travel experiences.
Do you dream of sipping champagne while chilling in a French château, or enjoying an authentic pizza Margherita in Italy? Or does your fantasy involve snorkelling off the beaches of Thailand? Wondering how to financially plan a vacation? You can make your dreams a reality with a little innovative thinking and dedication.
Here are six effective ways to save for travel fund for your next vacation.
Set a travel budget
Every good plan starts with a sound budget. Understand how much you will need to meet your daily expenses, pay off loans, create an emergency fund and save for the future. The remainder you can set aside for your travel. Do your research and figure out how much to save for an international trip you want. Trips around Asia, the Middle East and Africa can be done in a lakh, plus some money for shopping or new experiences. Putting aside just Rs 10,000 a month will help you save Rs 120,000 over the course of a year! This will be enough to fund a luxury international holiday for yourself or a budget holiday for you and your partner. Ensure you meet your goal every single month. Make sure you put this money in a separate account. Which brings us to our next point...
Create a travel savings account
Having a dedicated travel account will help you understand how much money you have at hand to fund your travel and how much you’ll need to add to meet your goal. This money will not get mixed up with your expense account and you won’t end up spending it. Get a zero balance account so you don’t have to pay any penalty when you actually spend it. A travel account will not only help save for travel fund but also help you stick to your budget during your holiday. You can get the best travel credit cards linked to your savings account when you actually set off. This will make spending abroad easy.
Set up a recurring deposit
If you don’t trust yourself to dedicatedly put aside money for travel every month, automate it! Setting up a recurring deposit (RD) is a great solution. All you have to do is go to your bank app, start an RD, set an amount and date on which you want the money to be automatically deducted, and you’re done. This way, not only will you never miss a monthly deposit, but you will also earn interest on your savings and experience the magic of compounding.
Declutter and make gains
Decluttering and minimising your possessions not only simplifies your life, but it can also help you fund your travel. So follow Marie Kondo’s advice and get rid of all the physical objects that no longer bring you joy. You can donate some of it to an NGO near you. Sell the rest online on a platform such as OLX or Quikr. You can sell electronics, phones, furniture, etc. The money you make from this exercise can go straight into your travel savings account.
Collect travel vouchers
If you are blessed to have family and friends that gift you on birthdays, festivals, etc. ask for cash that goes into your travel fund – or request travel vouchers that you can redeem for flight tickets or hotel stays. If all the money pooled in can finance your tickets, most of your monetary burden is solved! You can then use your savings to enhance your travel experience. Go wine-tasting, pamper yourself at a spa, or go skydiving. Do whatever you want to check off your bucket list.
Convert credit card points
Many banks offer the option to convert points you earn from using your credit card to travel miles. Leverage this benefit and keep adding to your miles. You can use this to fund your flight tickets – or at least part of it. This will incentivise you to use your credit card more often. Paying off your bills on time will also help you boost your credit score. It’s an absolute win-win.
Now that you have learned how to financially plan a vacation, don’t forget to buy travel insurance before you set off to your dream destination. This will take care of you if anything untoward happens. There are various types of travel insurance available online, so do a comparison on aggregator sites and pick one that suits your needs best.
No matter where you are headed, make sure you choose an overseas or domestic travel insurance plan as necessary. Take a look at the types of travel insurance coverage in India. Bon voyage!