Dreaming of that Euro trip for your 40th birthday, or a Bali escape with your besties? We feel you. According to a recent travel trends report by Luxury Escapes, nine out of ten Aussies will be gearing up for a travel adventure in 2024.
But with inflation, interest rates, and the cost-of-living soaring, it sometimes feel like the dream of a holiday is out of reach. While travelling does come with a price tag, the good news is you can make it happen without breaking the bank.
With a bit of foresight and a solid budget, you can stash away those dollars and start exploring more places on your bucket list. Here are our savvy tips on how to save up for your next holiday.
Calculate the damage
First things first – it’s time to crunch the numbers. Whether you’re eying off a blissful week in Bali, or a cross-country road trip in the USA, you need to be clear on exactly how much you’ll need to enjoy your dream getaway.
Start by jotting down all the essential expenses: think flights, accommodation, food, travel insurance, visa, passport costs, and transportation. Do your research and estimate the costs for each day you’ll be away, including all the nitty-gritty details like sightseeing, shopping, tours, and activities.
Heading to a destination where tipping is customary? Factor that in. And don’t forget your safety net – an emergency fund is non-negotiable (because, let’s face it, travel disasters happen). Another consideration is the exchange rate; nobody likes unpleasant surprises when converting Australian dollars into the currency you’re going to need.
Be generous with your estimates – it’s always better to have extra funds than not enough!
Budget your bliss
Now that you’ve sketched out a rough idea of your trip and have a ballpark figure of the costs, it’s time to create a budget. Begin by listing all your monthly income and expenses to determine how much you can realistically save. You can download our mymo by BCU app to get a full picture of your expenses across all financial institutions – you can also automatically categorise them so you can see exactly how much you really spend on things like takeaway or clothes. This step will not only give you a clear financial roadmap, but also help you gauge the time it will take to turn your travel dreams into reality.
If you have a specific time frame in mind for your getaway, work backward to calculate the necessary monthly contributions. For instance, are you aiming to save $2000 in the next six months? That translates to $330 per month to meet your goal. Break this down further based on your pay schedule – $153 every fortnight or $76 each week.
When setting these targets, be realistic about how much you can save. There’s no point making regular contributions to your travel fund if you regularly dip into it.
Check out our article on how to get into good financial habits, with tips on building healthy financial habits that will help you save money.
Supercharge your savings
Now you’ve established your money goal and have a savings plan in place, it’s time to put your money to work.
One way to do this is through high-interest savings accounts. Savings accounts like these offer higher interest rates and give you a separate space to stash your savings, so you’re not tempted to dip into them. They’re geared towards nurturing the growth of your savings over time.
Better yet, set up regular automated deposits to this account so you can sit back and watch your holiday fund grow.
Here’s how to kickstart your savings journey
- Open a BCU Bonus Saver account.
- Set up regular deposits from the transaction account your salary is paid into.
- Watch your holiday savings grow automatically. It’s that simple!
Spend wisely, travel well
Now it’s time for the exciting part – finalising your travel plans! Before you book, consider these helpful money-saving tips:
- Book strategically
- Book as early as possible. Keep an eye out for timely deals and be in a position to act quickly when they come along.
- Avoid peak holiday times, especially in popular destinations. Opt for off-peak or shoulder seasons to increase your chance of snagging a better deal.
- Shop around for accommodations, exploring options like hostels, homestays or house swap websites to potentially cut costs.
- Use flight comparison apps
- Leverage apps like Hopper and Skyscanner for alerts on the best flight deals.
- Be flexible with your travel dates to find the most cost-effective options.
- Be digital savvy
- Clear your browser cookies when searching for flights to avoid potential price hikes upon revisiting websites.
- Shop smart
- Compare prices diligently and be cautious of hidden fees.
- Explore cash-back apps that offer rebates on accommodation costs.
On your way? Here are some extra money-saving tips:
- Avoid exchanging money at the airport. Instead, use a travel card like BCU’s Cash Passport Platinum Mastercard for convenient fee-efficient transactions in multiple currencies.
- Shop wisely! Exercise caution when making purchases, especially in tourist traps, and ensure your budget stays intact.
- Look for the cheapest and safest ways to get around, whether it’s catching a bus, a train, or simply walking.
- Choose local eateries to experience authentic cuisine and reduce food expenses. Whenever possible, prepare a meal yourself to save on dining costs.
- Embrace the freebies! A quick google search for ‘free activities in [insert city]’ will reveal a plethora of cost-free attractions and experiences.
Happy travels!