Save Money and Have a Vacation!

Have you wondered how you can save money on vacation this year? The options range from two-week, first-class cruises in the Mediterranean to snoozing in the kiddy pool in the backyard. Obviously, the decision is about more than choosing where to go and what to do. It also presents an opportunity to decide how to manage a major portion of your discretionary dollars.

When it comes to vacation planning, there are several potential problems:

First, too often, most of our income is pre-allotted before the paycheck even comes in. We have mortgages, car payments, credit card debt, utility bills, grocery bills and more. These are mostly fixed, non-negotiable expenses. We have little wiggle room for discretionary expenses.  However, when it comes to our vacations, our options are big and many. Are you planning to fly the family to Italy for a Roman holiday?  Take 10 days to drive cross country to see the natural wonders? Rent a cottage by the shore or a cabin on a lake? Or just putter around the house and doze in the afternoon sun on the back deck?

Second, many Americans borrow for their vacations. It is not uncommon for a family to spend five days at a vacation resort or theme park and spend the next 12 months paying for it.  The bottom line: Your vacation is something over which you have total control. This year, why not plan to relax and have fun, but also save money? Here are some ideas that can help:¹

1. Do not equate money spent with fun received – Consciously look for ways to both have fun and be thrifty.
2. Set a vacation budget – Decide how much you can afford (and want) to spend. Too often, we pack our credit cards and off we go on vacation, spending money impulsively on everything we see. Then a few weeks after our return, we groan as the credit card bills start coming in … and in. Instead, select the amount you are willing to spend, and stick to it.
3. Spend money like you’re at home – It is not uncommon for vacationers to spend money on things they would never spend at home. The tourism industry is counting on that. So, before you buy that $50 memento worth $7 or shell out $200 for a 15-minute helicopter ride, ask yourself if it really is worth the money.
4. Take a less pricey vacation – A super-posh theme park or resort can cost thousands. Visits to the shore, hiking trails, museums and state and national parks can save as much as 75 percent … and be just as much fun.
5. Take shorter vacations – A series of three-day weekends can be just as rewarding as (and less stressful than) a two-week trek. Plus, the cost is more controllable. (If cash runs low, just cancel one getaway weekend.)
6. Take closer vacations – No need to pack up the family SUV and travel 2,000 miles to have fun. You can get as much “Aaaah” value from a few hours’ drive from home, exploring the sites in your own state.
7. Take a “stay-cation” – In other words, stay at home. Putter around the house, take day trips to explore local events and in the process save a ton of cash.
8. Take the time to shop for travel deals – The tourism industry is always struggling to remain competitive, so cost-saving opportunities are available. Shop online, but also don’t hesitate to call directly and ask for discounts. Be a smart consumer .
9. Plan ahead – Last-minute bookers often pay top dollars. Scheduling hotel and travel arrangements one to six months in advance can cut some costs in half.  The exception: If you shop online, some great last-minute deals often can be found with airlines and resorts trying to fill empty seats and rooms. This can work well if you decide on Monday you want to get away on Tuesday … and don’t necessarily care where you end up.
10. Pay cash. Why not postpone this year’s super trip and instead set up a vacation account at your credit union or bank? Put in $200 a month for next year’s $2,400 vacation. Imagine the feeling of being able to pay cash and not have to come home with large credit card bills.

¹Source: John Ingrisano, Director of the Family Finances Conference Center and author of The Back to Basics Book of Money.