How We Budget For Our Big Trips
So how do we budget for big trips that can cost us around $10,000? Soon you will see. Our goal is to help guide people in similar situations to achieve their big travel dreams the way we have been able to fulfill ours – check out our bucket list. Do not let money discourage you. If we, 25 and 26 years old, with A LOT of student loans, car payments, rent, etc. can do it, then so can you! We understand that everyone’s situation is different, but hopefully out guide can help advise on ways you can save money for traveling.
The Three Steps
Since day one of our relationship, I have been the mastermind behind our finances. I budget our life by controlling and breaking down our finances on one excel document. I recommend you do the same or find a way that works best for you to manage your finances. Next, is setting a goal. What do you want to achieve and how quickly? For example, we booked our honeymoon in December and were going on the trip the following September. So, we set ourselves a goal of how much we wanted to save in 9 months. Lastly, stick with it! You are making a commitment to yourself to achieve your goals. Do not let pressure, discouragement, doubt, anything, get in your way because when you reach your goal and you’re on the trip you’ve been saving up for, the trip is not only amazing, but it is rewarding!
How We Budget
First, we take our four paychecks that we receive over the course of four weeks, never by a full month. Then we will deduct every monthly payment – rent, car payment, loan payments, electricity, insurance, internet, cell phone plan, personal trainer, emergency savings plan, etc. At this point we evaluate our goal and what we can accomplish with the remaining monthly balance. In our case we save around 22% of our monthly income. You choose how much you want to save based on your income and your goals. Once you figure out the amount you can and want to save, deduct that amount from your remaining balance. Now this is your actual balance to live on for the remaining month and you live by it. Every week see how much money you have spent and keep track of your spending. Make sure you are aware of how much you are spending every week and how much money you have left in your balance.
Another thing we do is plan or think ahead. We never like spending large amounts of money on one monthly income, like flights or anything more than $300. For example, we are at the end of the month and still have $550 in our spending money, we see there is a hockey game next month so we will buy the tickets now when we can afford it. If we had less than $200 to spend for the remaining of the month then we would do our best to be a penny pincher and use the leftover money to help pay for the tickets the next month. That way theoretically, one ticket could have come from last month’s paycheck and another ticket come from the current month. A little confusing, but trust us it works.
Another example is traveling home to see family. Usually we know a few months ahead of time when we will purchase flight tickets that could cost around $600 total. So what we like to do is deduct $200 from our monthly income over the course of three months. After three months of automatically saving $200, we can easily spend $600 in one month without hurting our monthly income balance.
Our Three Big Rules for Money…
- Just because you want it doesn’t mean you NEED it (within reason). Does Christina want to buy Adam a pair of nice Rayban sunglasses? YES! Does he really need them? Well kind of, he needs some sunglasses to protect his eye, but he doesn’t need the $200 pair of sunglasses. So we buy the sunglasses on sale for less than $100 (this is our within reason because let’s face it, the sunglasses look good on him and he does need a pair).
- When you receive extra money (gift money, bonus checks, tax refund, etc) do not spend it. SAVE it. We use tax refunds as an emergency fund that do not actually go into our real emergency savings account. Confusing we know, but bear with us. For example, our wedding and honeymoon… we were absent from work for around 12 days and did not have any paid vacation, so we dipped into our tax refund with only what we needed to make it through the month which still left us with money from our tax refund.
- Save for tomorrow, but still LIVE for today. Life is short, too short. It is great to save for the future, and for big travel trips but you cannot get caught up in saving so much for tomorrow that you forget to live in the present. This does not mean forget rule #1. This means that it is okay to go on a road trip and hike Zion National Park or go out for dinner and drink with your friends. It does not mean to go out and buy $500 worth of clothes, games, or going out every weekend. No, because you do not NEED that, but you do need to enjoy the life you have because anything can happen tomorrow and then you will never get to go on the trip you’ve been planning for three years. Shit happens. Sorry for the language, but it does and everyone just needs to find their right balance.
If you have some budget friendly tips, I would love to hear them! There is always something new to learn or ways to improve. If you have any questions or need help budgeting for your own trip feel free to contact me! I hope my budget guide helps you achieve your travel dreams!