Imagine how it feels to not worry about money on your dream vacation. How does it feel to be able to pamper yourself with a massage anytime you want it and have a fancy meal under a starry night without a care about the cost of anything? Isn't it just perfect?
The reality for most people however is entirely different. We often stress about the cost of travel and struggle to save money to go on a vacation. But, nothing is impossible if you're really dedicated to making your dream vacation itinerary come true. The key is to create a structured savings plan for your travels and commit to it.
We'll show you 5 easy steps to build your travel fund that will get you to your dream destination in no time.
1. Set your travel savings goal
You might wonder why we every financial tip starts with setting a goal. There are plenty of reasons for this. One of this is to be able to create a realistic goal based on your current financial situation. It also will help you to track your progress and determine what you need to do to achieve it and lastly a reason to celebrate when you achieve your goal.
In this instance, you need to need to know how much money you plan to spend on your travels while taking your financial situation into consideration. It doesn't need to be an exact amount, just an estimate will do.
A good way to start figuring out is to look at how much you've spent in your previous travel and work from your way there.
BigPay can tell you how much you've spent for each travel destination and show a breakdown of your spendings.
If not a simple search on Google will get you most of the answers you need. Determine how cheap or luxurious you want to travel and do a breakdown of cost for your travel. Consider some of the costs below:
Let’s say you spend, on average, RM500 a day while travelling, and you travel approximately 25 days each year. You'll want to factor in some emergency money as well. So in total, you might want to aim and save RM15,000 per year.
2. Set up a dedicated travel savings account
Once you've set your travel savings goal, it's time to open a savings account dedicated solely for travel. This account should be used only to save or spend for travel.
Why do you need a dedicated travel savings account? That way you won't be confused with the balance from your general savings or current account or be tempted to spend it.
It'll also help you stay on budget easier while travelling as you'll know how much balance you've left in the account. You can also keep an eye on your balance as your trip progresses, and track the expenses of your trip without too much effort.
PRO TIP: Manage your money better when you travel by transferring how much you want to spend to your BigPay. When you spend, you will be instantly notified and your expenses will be automatically categorised for easier tracking.
3. Automate your savings
When your travel savings account is up and running, it’s time to fill it up!
The best way to do this hassle-free is to set up a recurring automatic money transfer from your checking account (the account you receive your salary) to your travel savings account.
This is how it's going to work:
Decide on the amount you want to set aside for your travels monthly (taking your travel savings goal into consideration)
Set the automatic transfer to happen 1-2 days after payday
Once it's ready, sit back and relax as you count the days to your next vacation.
Letting automatic systems to take care of savings are extremely helpful as you'll never have to remember to put anything aside yourself. When you 'pay' your travel savings account, you're essentially putting away that you might otherwise spend therefore making it easier to resist temptation to spend. If you're poor at managing your money, this would be really helpful.
4. Keep track of your savings and cut unnecessary spending
Good job if you've made it this far! Now that you've automated your savings, you need to keep track of your progress regularly to make sure you're on track.
Your financial situation might change overtime and that's normal. When the time comes, you need to be flexible and adapt to the changes. If the progress is going as planned, great. If not, do something about it.
Look for ways to cut unnecessary spending. It may seem like a lot of work which is why BigPay is here to help make that easier for you with the newly redesigned analytics. When you're aware of where your money is going, you'll be in a better position to make smarter spending choices and identify areas you can cut back in.
Related articles on saving:
5. Make more money
Another way to fill up your travel fund is to work and earn more.
There are many ways to go about doing this. You could:
Ask for a raise
Look for a higher paying job
Get a side hustle
And when you finally figure how to grow your income, you can always manually transfer the excess money to your travel savings account to help you reach your goal faster.
But if all else fails...
It's simple! Tell us what you would do with RM10,000! Make it cool and inspiring, the best pitch will win RM10,000 and you might get to live out your dream!