Q: [Whole Family] It seemed like we were the only family not off on a holiday trip, but our budget was shot after the season of giving! We don’t want to be “home alone” for spring break, how can we make sure we plan ahead and prioritize saving for a family trip?
A: Everyone looks forward to going on vacation, but oftentimes they overlook the vacation budget. If you’ve got your trip covered financially, you’ll appreciate it more knowing you won’t bring back a suitcase full of credit card bills, which could sidetrack your other important financial goals, such as saving for college or retirement. Follow these budgeting tips to help plan your spring break vacation:
Estimate the trip’s costs: You’ll want to estimate costs for transportation, lodging, food and special activities. Remember a daily allotment for incidentals, such as gifts and possible emergencies.
Outline your savings plan: If your vacation is less than one year away, consider a savings account rather than an investment account. If you determine a savings account is the best route for you, look to take advantage of a banking rewards program like Preferred Rewards from Bank of America that will help your savings grow faster with an interest rate booster. If the trip is a pricey, once-in-a-lifetime adventure that’s down the road, consider investing your money to potentially yield higher returns. This can help you meet vacation savings goals and enhance your vacation experience. Also think about setting up recurring transfers from your checking account to a separate account dedicated to your vacation funds to make your savings automatic. If you don’t know where to start, you can seek guidance from a financial professional to help you set these goals.
Reap rewards from your vacation savings: Once on the trip, pat yourself on the back for putting in place the disciplined savings plan that got you there. Of course, having fun and relaxing are what vacations are all about so get ready to enjoy it. Now you can rest easy knowing that your long-anticipated trip didn’t sabotage your regular saving and investing plans, and that you won’t come home in debt. Your trip will instead become a lifelong memory of an enjoyable time away.
Wesley Gunter is a Newport Beach-based Financial Solutions Advisor with Merrill Edge, a streamlined investment service providing the investment insights of Merrill Lynch and the convenience of Bank of America banking. Wesley lives in OC with his wife and two children. firstname.lastname@example.org