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How to Budget for a Trip

budget for a trip

Dave Ramsey once said, “A budget tells your money where to go instead of wondering where it went.” Have you ever imagined going on a luxury vacation, but never thought it would be possible? You take a look at your bank account and you notice you are spending more then you are profiting, but figuring out finances and budgeting your money can be difficult and stressful. This is no easy task, but if you follow these 4 easy steps to help better manage your money, so you can start saving for your dream vacation!

Step 1: Log into your bank accounts and find out what you’re spending money on.

Did you know nearly 20% of Americans check their bank accounts only once per month! I would go insane! You may miss an unknown charge, or maybe you didn’t realize your electric bill went up to $50 last month. If you are not familiar with checking your account, start by checking once a week. Dedicate a specific day of the week to sit down and evaluate your expenses. A few things to note down while following these steps are rent bills like water, mortgage, electric, cable/wifi, car payments, gas, groceries, phone bill, and any insurance you may obtain.

Step 2: Add up the total of all other expenses: clothes, coffee runs, eating food out, reoccurring fees like gym memberships, and live streaming subscriptions.

Now I know we all want every streaming channel under the sun, and to be able to have that fancy coffee drink that is trending online. The reality of it all is that you DO NOT NEED to own any of this. As a millennial myself, I try to find as much budget-friendly life hacks to save money. I rather have streaming subscriptions than cable, so I signed up for wifi only – saving me $75 per month – and used that extra cash to sign up for Hulu with the ESPN + and Disney + add ons for only $20 per month, saving me $55 per month that I can put towards other expenses.

Step 3: Determine if you can cut any of these expenses down.

Do you really need to stop on your way every day to work to grab that Dunkin Donuts Coffee? Do you really need another shirt? Prioritize your needs and wants, and sometimes writing them down in a list on paper will open your eyes to things you thought you needed, but may actually fall under the want category.

Step 4: Create a running budget and stick to it.

Once you figure out all of the money that goes out to your bills, insurance, etc, determine how much money you have leftover per month. Divide that by 4 and that is your extra cash per week. Once you have determined your extra cash per week, decided how much of that you want to tuck away and save.

Example:

Sally Smith is a single woman who live in a single-family home and profits $2500 a month from her job.

Her mortgage is: $900

Her cumulative Bills: $200

Groceries/eating out per week: $100

Gas: $20

Car Insurance: $120

Car payment: $300

Total out of pocket expenses: $1640

Leftover per month: $860

Leftover per week: $215

If I was Sally, I would take out $100 per week and put it in a box, and start saving. If you want to save more you can budget saving $500 per month which still gives you an extra $90 per week to spend outside of your daily expenses.

Tips:

Here are three tips to help make saving easier.

Money management doesn’t come naturally, it is an acquired skill. The saving journey is no way a sprint, but a marathon so stay patient and persistent. You need to decide how bad you want to travel. Are you willing to sacrifice Starbucks and the new trendy clothes to experience a vacation of a lifetime? If you answered yes, then continue to read for my tips.

Tip 1: Make your coffee at home!

The average 8oz cup of coffee when you buy out ranges between $2-$5. When you average that out, you get $3.50 which over a month span would cost you $105 in coffee alone. This is one of the most common mistakes when figuring out your budget, is not realizing how much over a month span an item can really cost you. If you buy the same brand of coffee grounds from the grocery store: for example, a 20oz bag of Starbucks Blonde Roast averages $11 in-store and is a 1 monthly supply that breaks down to about $.50 a cup. The average creamer is around $2, and if you are like me I tend to buy creamer about 2 times a month. The total cost of a month of coffee would be $15. If I could save $90 just by not stopping at a coffee place every day, that would add up to saving over $1000 in a year just from coffee!

Tip 2: Make your meals at home

We all know this, but neglect the fact that eating at home vs eating out every day will save you money. Why don’t we do this more often? Maybe we don’t always have the time to cook, for social outings, or maybe you just hate to cook. The average monthly budget for eating out for just lunch and dinner is around $462 per month. If we eat at home for every meal for one month; the average cost would be around $365 with a savings of $97 per month and $1100 annually!

Tip 3: Find opportunities to make money on the side.

When was the last time you went through your clothes? Declutter your closet of old jeans and sweaters that are too big or too small for you. Platos Closet does a buy-back program where you can sell your old clothes that are collecting dust, to gain some money to be stored away! Have a bike that you haven’t ridden since you were 16? Sell that too! Kids are grown, but you are still holding onto that car seat for your kids? Sell that too!

If you can develop a budget plan, while finding smaller opportunities to save money, you will be on your dream vacation in no time! Imagine, you start saving $100 per week,  you cut out buying coffee and meals out, and you could save around $7,700 a year! With Monster that could get you a dream trip to multiple locations! You can pair a travel package between Breckenridge and Hawaii for up to four people for all that money you saved! Now if Breckenridge, and Hawaii are not motivating you enough to start saving for your next vacation, browse all the other destinations we offer!

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