I often get asked how do we afford to go on holidays to Europe.
We often hear that people say ‘they must have taken a bank loan out to afford that’.
I would never take a bank loan to afford a holiday, but we can and do make sacrifices to save $20,000 for a holiday. These sacrifices seem well worth it when you are strolling the Champs Elysee in Paris, France, having a beer at Oktoberfest or watching your kids enjoy the beach in Barcelona, Spain.
To me, it’s just a matter of choice when deciding on holidays. You either want to go on a holiday or you don’t. Going on holiday overseas will require some sacrifice. My wife will attest to that, sometimes quietly, sometimes quite loudly at me! I am very strict on our savings regime and well to be more than honest, you have to be. It also helps that we have an older car and old style house. We don’t have a huge mortgage or new car repayments. Don’t get me wrong here we don’t want for anything. We have all the mod cons life offers, we just do it in a smaller house, with an older car and on a stricter budget. People often think that makes us poor and that’s fine, but I think people who have never travelled are poor, poorer for not experiencing different cultures, foods, histories etc
I have a habit of saying when I get old (I was going to say older but at 42 I nearly fit into that category) that I won’t remember a new car or a big house but I will remember the times our family spent on holidays. The excitement in the eyes of my children when we arrived at Harry Potter Warner Brothers Studio, my wife gazing at the sunset over Sacre Coeur in Paris, kids birthdays spent in Porto and Munich. That’s what I am going to remember, always.
You will never afford that big holiday if you just buy everything you want, no pain no gain! It’s no use going around saying I can’t afford that holiday when you won’t sacrifice.
The first Golden Rule to saving money is:
Do I want that or do I need that? If you start thinking like this, you will be well on the way.
* Sit down with a piece of paper and work out your budget. What can I afford to save and stick to it. Always leave a bit of padding in your budget because things will come up that need to be paid. Set yourself an amount that you can put aside every week towards your trip. Most importantly set yourself a personal budget every week for yourself. This money is for you to spend on petrol, lunches, alcohol whatever you like or need. If you can’t afford something within that weekly budget don’t buy it this week.
*Plan any upcoming activities in advance, that way you can put money aside leading up to them so it does not impact on your Holiday Budget. We plan for most activities at least 4 weeks in advance if possible. I have lots of money jars that I have included in our budget that I put money in weekly. I start a jar for Christmas the week after Christmas is done, I have another for car registration. I have one for kids birthdays etc. This minimizes the output of cash you will need at these times making your budget easier to stick to thus protecting your holiday account.
*Never buy anything when you can lay by it or pay it off. If it’s worth having it’s worth waiting for. It is harder to replace a large amount taken out than it is to pay a small amount every week.
*Get a Travel Money card that you can put money into and convert it into your currency of choice. It will make you think twice before withdrawing foreign currency and paying fees.
*Set yourself up an account that’s not linked to any ATM cards at this stage. I use an ING savings account that I have to transfer money into and out of from my normal bank. This means that if I want to take money out of it, it will take 24 hours to clear into my normal savings account. This helps with impulse buys as I don’t have ready access to funds at a push of a button. These accounts also have good interest bonuses for non-withdrawal. In the lead up to our last holiday, this account netted us around $500 in interest over an 18 month period of depositing.
*Rebecca’s employers allow direct deductions from her wage. We get a small amount deducted every week ($10) into a bank account that we never see. This soon adds up over the period of your savings for travel. This money can be used to pay for entry to attractions or public transport etc thus not impacting on your daily travel budget.
These are some of the strategies for Holiday Saving that we use. I am not saying it will be a quick save for some but eventually, if you have the will you will get there in the end. Your income will have a big influence on what you can save and how quickly you can save. International travel is maybe not in everyone’s income bracket, but domestic travel is still possible. In the end, it does not matter whether it is Europe, Asia or Australia you and your kids will all be richer for the travelling experience that they are exposed to.
Now grab that pen and a piece of paper and start working on that budget. If these strategies for saving money help just one person I will be happy.
You can also read our other posts on how to save money booking flights here.