For those of us with families the summer heat brings the expectation of holiday fun, with exotic locales and activities aplenty for your children and partner alike. But budgeting and planning for these extravagant getaways can be as stressful as your full-time job. In fact a recent AICPA survey reports that 6 out of 10 Americans feel a financial anxiety during summer months that can match or exceed the stress of the year-end holidays.
So, with fluctuating travel fares, accommodation and currency exchange rates all on our minds, what can the average traveler do to minimize the financial cost of all these expenditures? We’ve compiled a handy list of tips to help your summer planning to ensure your family can enjoy their holidays and you can too.
The closer you get the summer the higher you’ll find the cost of your holiday to be, so start your research early. Look up hotels, restaurants, and the cost of car rentals as well as the average price of activities in the area you’re likely to visit. Stay on the lookout for inclusive packages you can book in advance, allowing you to book a summer holiday at far cheaper winter prices.
Remember to stay flexible at this stage, while you may have a particular destination in mind it never hurts to check out your options, as you may find a cheaper alternative that fits all your needs. Look for countries where your dollars can get you the most utility by converting into the local currency, as this can inspire big savings.
After you have a good estimate for likely costs and expenditures it’s time to start saving for your holiday. Analyze your current financial circumstances and figure out the short-term sacrifices you can make. Many financial experts suggest creating a separate savings account, so that you can keep track of exactly how much you’ve got put away for the summer. Keeping the checking and savings accounts separate will also ensure that you’re not struggling with extra debt by the time you come home.
Make sure you have a credit card that isn’t charging you exorbitant fees for foreign transactions; taking a hit of up to 3% on every payment can really throw your careful budget off kilter. Instead shop around and see if you can acquire a credit card that offers certain incentives that will serve you well. For example, the Bank Americard and Chase Freedom Unlimited credit card have both offered a 0% introductory APR for 12 and 15 months respectively. This allows you some breathing room on holiday payments without interest rates being charged.
Look for credit cards that offer travel and cash back rewards as well; cards such as the Chase Sapphire Preferred Card can entitle you to hundreds of free flyer miles at a certain level of purchases. While Cash Back Rewards let you get back a percentage of money on your daily bills.
Remember a good credit card will only augment your budgeting and planning, no matter how good your rewards are it won’t help if your balance stays in the red long past due date.
Don’t wait until the last minute to buy local currency, airport exchanges will generally offer horrible rates. Plan ahead and research sites that can offer you the best comparative rates, once you find a price that’s favorable snap up the offer and sit back.
Good financial planning and logical reasoning underpin the achievement of any lifestyle goals. Whether it’s an exotic holiday or an easy retirement the principles remain the same, understanding your current finances and where they need to be will serve you well with any task you have planned. So regardless of the summer you’re dreaming of, whether it’s at home or abroad start budgeting and planning now so that you too can achieve your financial objectives.