With summer time in full swing, I think we all have that dream vacation in mind. But here’s the thing: you don’t want to blow all of your hard-earned savings on a trip. So how do you save up while still paying the bills and preparing for the future?
Here are some tips to make your dream vacation a reality.
I recommend setting up what’s called the 50/30/20 budget. 50% of your earnings (after tax) go to necessities like bills, rent/mortgage, etc. 30% is fun money. 20% is savings, including your retirement and emergency fund. This budget helps to ensure that your bills are paid, your savings and retirement are still growing, and you still get to have fun.
Estimate the Costs
Create a Vacation Fund
You will need to make sacrifices to make your dream vacation a reality. Once you have created your budget and know how much this vacation should cost, look at where you are spending your “fun” money and figure out where you can cut expenses. Do you eat out every week? Get coffee every day? Allocate a certain amount of that budget specifically to your vacation fund.
Map Out a Plan
Plan how long it will take you to save up what you need. Do you need to save a dollar a day? $100 a month? Stick to your plan, and you will be on your way to your dream vacation in no time!