The weather is heating up and so is vacation season!
A recent WSFS study found that 35% of regional respondents had a goal to save for a large purchase like a vacation, but following a year of increased costs for everyday items coupled with rising interest rates, saving and budgeting for a vacation can be difficult.
Whether you’re planning a trip for this summer or further in the future, budgeting for vacation can be as crucial to a successful trip as remembering to wear sunscreen.
Here are tips to help you budget for a successful vacation.
Search for Savings
It’s always important to do your research before taking any trip, but with prices continuing to rise for airfare and more, it is even more vital. Take the time to research your destination, how you will get there and where you will stay, and then start searching for deals.
Traveling in off-peak times can be a great way to get to your destination and find a place to stay for a lower cost than usual.
It is also important to budget for the money you will spend once you’ve reached your destination. If you’re staying at a hotel or rental property with a fridge and kitchen, taking a trip to the grocery store when you first arrive can help save money on essentials, snacks and more.
As you search for deals, remember to remain vigilant and aware of scams. Scammers have been known to impersonate websites, emails, phone numbers and more from legitimate businesses, so if a deal seems too good to be true, it may be a scam.
Utilize Credit Responsibly
With interest rates elevated, it is more important than ever to utilize your credit and borrowing responsibly.
Credit cards, particularly those that offer rewards, can be a great tool for booking your vacation, but you’ll want to ensure you can pay off the bill in full each month where possible to avoid accruing interest and the cost of your trip rising.
If you’ve already built-up credit card rewards like cash back or airline miles, now could be an opportune time to cash those in and reduce the out-of-pocket cost of your trip.
If you’re traveling internationally, you’ll also want to look at the terms and conditions of your credit cards before using them to book to avoid any surprise fees for things like international charges. For international trips, there are also benefits to bringing cash in your destination’s currency to help ensure a smooth trip.
Start Saving for Future Trips
It’s never too early to start saving for your next vacation. While rising costs and interest rates have made it more difficult to save for many consumers, the tradeoff is the opportunity grow your savings with tools like certificates of deposit (CDs), money markets and high yield money markets, which typically offer a higher interest rate than standard savings accounts.
If you know when and where you would like your next trip to be, start planning now and utilize higher interest savings tools to grow your nest egg and build toward your next destination.
If you find your budget is stretched too thin, a “staycation” with family and friends may be a better alternative to relax and unwind without incurring the cost of a trip. If you need more assistance with your budgeting, consider setting up an appointment with your local banker, who can help set you on the path toward achieving your financial goals.
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Read our financial resources from your friends at WSFS.