When was the last time you escaped your daily life and went on holiday? A week, month, or maybe even a year ago? Aside from the fact that holidays are down-right enjoyable, there’s a whole list of other reasons to take a break with your friends and family every so often!
Naturally there will be optimal times to take leave and times that are much less favourable – for example, if you work in hospitality, you might find it difficult to get leave during major holiday periods. The average Australian, according to the Fair Work Ombudsman, accrues 4 weeks of annual leave per year. Four weeks! That’s a lot of time to spend relaxing in a tropical paradise, skiing in the mountains, or immersing yourself in an experiential trip volunteering in a developing country.
The problem many of us face is pulling the money together to do so. The moment that you say, “That’s it, I need a holiday,” you’ve probably left it too late to buy reasonably priced flights and accommodation, and haven’t prepared for the cost of covering your ongoing expenses like rent or mortgage repayments whilst you’re away. So what should you do to make sure that when the travel bug hits, you’re financially equipped to jet off towards that alluring destination calling you?
Make a realistic expenses budget
Budgeting can be as easy or as hard as you make it. We suggest keeping it simple, but thorough. Open up your bank statements and using a spreadsheet, write down all of your regular expenses each on a different line. From there, calculate how much you spend in each pay cycle. For example, if you have a fortnightly car loan repayment of $100 and you’re paid weekly, divide that amount in half (and remember to account for this expense while you’re away) Do this for all your bills and you’ll finish up with a dollar amount that is income minus expenses. From here, you can subtract the money you’ll need to maintain your lifestyle, top up your emergency fund and so on. Then, when you’ve run the numbers, you can extract an amount to be put into savings that you can build on week by week to fund your next holiday. If you’re putting away $100 a week, you could have a fully funded holiday to Bali saved in a few short months.
Thankfully, there are savings apps that can help you stay on track with your budgeting. Let’s look at Pioneer Path for example; a free all-in-one budgeting app that tracks your expenses and lets you easily set goals to grow your savings account. Download the app now!
Work out how much annual leave you’ll need
Look at your most recent payslip and workout how much leave you have available. Given your holiday may be some weeks or months away, speak with your manager to work out how much leave you’ll have available by the time you want to take your holiday.
Research your holiday destinations
Do your research. You’re going to be looking forward to this holiday and the excitement will have built by the time you reach the start of your break. Speak to friends, post on social media, browse discussion forums and plan the holiday you want. Hot tip: Booking through various ‘deals’ websites could help you save hundreds on accommodation and activities!
What will your holiday cost?
Holidays and travel offer priceless, unforgettable experiences, though they can come with a fairly hefty price tag. The cost of a holiday will vary from person to person. As a benchmark, a week in a villa in Bali including travel, accommodation and spending, will cost around $2,000 for an individual. So what about a 1 month trip around Europe, or 6 months travelling through South America? These costs can grow rapidly, and often you won’t gift yourself the luxury of planning ahead. In this instance, you could secure a personal loan for travel. This is also known as reverse savings (Really?). Instead of planning months in advance, you could dive in to the holiday of your dreams today, and start paying for it tomorrow. Be sure to exercise caution when pursing this path; ensure you have stable income when you return home and that you have sufficient funds to last you through the whole holiday.
So what are you waiting for? Your next getaway is within reach, so start planning!