Everyone needs a vacation now and then – whether it is an actual trip to some exotic destination, or just a break from work. However, taking a vacation usually means extra expenses, and if you work for yourself, it can also mean a loss of income. Here are some things to look at when budgeting for vacations.
Getting a Budget Together
The first step in budgeting for vacations is to get your budget together and set vacations as a goal. When building your budget, you should look at our timeline for when you want to take a vacation. Some people are very strict – we take a 1 week trip every July, while others are more flexible – I want to save $10,000 for a 2 week trip to Europe. In the first scenario, you can save what you can until you get to July, and plan a trip with what you have (or a stay-cation if you don’t have enough money), or as in the second scenario, you can keep saving and saving until you have enough for your goal.
A second way to do it is to go backwards – look at what your dream trip is going to cost, and then build that into your budget. You can then set timelines based on how long you need to save for to achieve your goal.
Where to Find the Money
The next step is where to find the money. A budget is all about making choices on what to do with your fixed income. You only have X coming in, and you have priorities A,B,C,D and more. Some common tactics that people use are: cutting out cable until vacation and saving the difference, eating out less often, and more. You can also go the other direction and try to boost your income. You could hold a garage sale and sell some old junk around the house, or you could even try to sell some things on eBay to pay for the trip. Either way, you need to make choices on where you are going to get the money for your trip.