Making the right personal finance decisions will allow you to do more with your current income. It’s not always as easy as out-earning the bad financial decisions you make, such as financing a vacation you can’t afford. However, you can still afford a dream vacation, if you take good look at where you spend your money.
Maybe you’ve always dreamed of taking a luxury cruise to Spain or you want to travel through Italy. Wherever it is you’ve always wanted to go, you can get there without taking out a second mortgage or refinancing your home.
Here are some of the things to consider as you put together a financial plan for your dream vacation.
Dump Debt First
Probably the easiest way to free up money for a vacation is by paying off debts. We’ve become a society that accepts debt as a way of life, but this isn’t the way it has to be. You can live without car payments, credit cards and other types of financing with a little discipline and some time. Most people can free up over $500 a month they can save towards a dream vacation just by paying off their vehicles and eliminating those monthly payments.
Understand and Adjust Insurance Coverage
Insurance is a hard topic for many, but an easy place to free up money in the budget. Make sure you understand the base concepts. Ask yourself: what is term vs whole life insurance? Which car insurance coverage fits best for you and what type of health insurance you need? Sit down with a trusted professional and figure out what coverage you need and which ones you can cut.
Set a Savings Goal
After you’ve looked at a few of the areas you might be able to adjust in your budget, you will need a savings goal for your dream vacation. This should be realistic and include saving every month until you have enough to take the trip. It can be fun researching the different places to stay, activities to enjoy and other things you will do on your dream vacation. Take the time to really plan this trip and set your financial goals accordingly.
Provide a Visual Reminder
You know you want to take your dream vacation and you’ve often thought about how much fun it would be. As you set your savings goal, find a few pictures you can use as a visual reminder of the trip you want to take. You can turn them into a collage, use one as your computer screensaver or carry a picture in your wallet. This will serve as a reminder and help you stay on track with your goal.
Taking a dream vacation isn’t cheap and not something you should do without the right amount of cash to spend. We all deserve the vacation of a lifetime and it’s possible with a few budget adjustments to pad your savings. Just make sure the important things are taken care of first, have patience and work hard towards your savings goal. Before you know it, you’ll be sitting on the beach, gazing at the Eiffel Tower or visiting one of the many other dream destinations you have in mind.