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How to Financially Plan for a Vacation

Home 9 Blog Posts 9 How to Financially Plan for a Vacation

The warmer seasons are fast approaching as temperatures are beginning to rise and the fresh buds are blooming. The changing season is when many look forward to activities such as spending the weekend on the lake or at a beach, family cookouts, graduations and more importantly…vacations! These times are when we can indulge ourselves by disconnecting from everyday demands, unwind and refresh our minds before going back to the grind. While it’s easy to visualize in your head where you want to go, where you want to stay and what you want to do, it’s also important to be mindful of the financial obligations that comes with planning our escapes.

First things first, what is your budget for the entire trip? With a number in mind, think about the places you want to go and how long you want to stay. We can spit out a number of places we want to go, but it pays to be realistic. Spur-of-the-moment trips can be more costly than one that is well-planned out. Cull down a list of options that is feasible for you and for all those accompanying you. This can be a great activity for family and even friends because a planner can plan all he/she wants, but it’s more enjoyable when you know the people going are all in agreement.

Let’s not also forget to consider the time of the year during your research as high season is typically more costly than offseason. And if traveling internationally, look into the exchange rate before deciding on the destination as your money can go farther in some countries than others.

After narrowing down a destination, you may want to look into transportation as booking in advance can bring great savings. If traveling by airplane, prices can fluctuate depending on the day and time. Try checking out mobile apps that predicts how prices will change and tells you whether to purchase or wait. Also, don’t forget to factor in countries or cities where public transportation is predominant. Leveraging local mass transportation can not only save you time but can also put more money back into your pockets.

Lastly, you will want to explore a multitude of lodging options to help get most out of your budget. While hotels and resorts offer great amenities, there are a number of comparable options such as Airbnb’s and hostels that can be more cost-effective. Weighing the benefits and costs of each will help you to determine which will be most suitable for your stay.

After the initial investments of transportation and lodging, set a daily budget for other expected expenses such as dining, activities, and miscellaneous spends on shopping and souvenirs. You will also want to add at least 10% to that number as a cushion for any emergencies or unforeseen expenses that may arise during your trip. Remember, even the best planned trip can be impacted by the unexpected.

While these are all fundamentals to planning just about any vacation, there are many other aspects to consider before taking off such as reviewing existing insurance policies (possible savings on car rentals!), updating important life documents, setting up automatic payments for bills, and much more. When comes to travel, even the slightest oversight can cause a financial setback and ultimately, ruin a vacation. Don’t let this happen to yours! As your dedicated team, we’re here to help you avoid any financial roadblocks that may occur so that you can enjoy life away from life with ease.

Happy planning and safe travels!

-Mike Kojonen

Founder & CEO of Principal Preservation Services

Footnotes, disclosures, and sources:

This document is for educational purposes only and should not be construed as legal or tax advice. One should consult a legal or tax professional regarding their own personal situation. Any comments regarding safe and secure investments and guaranteed income streams refer only to fixed insurance products offered by an insurance company. They do not refer in any way to securities or investment advisory products. Fixed insurance and annuity product guarantees are subject to the claims paying ability of the issuing company. Variable annuities are considered securities products and require one to have proper FINRA registrations, in addition to proper state insurance licensing, prior to selling or discussing such products.

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