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Relax! Here's How To Financially Prepare For Vacation

Relax! Here's How To Financially Prepare For Vacation

Vacations can be one of the biggest reasons Americans have poor financial health. Going on that expensive, private tour in Scotland or buying Murano glass in Venice can hurt your financial health and might even cause long-term problems like lowering your credit score or causing you to spend hundreds in fees and interest rates.

Here is how to financially prepare for a vacation, so you aren’t feeling the effects for months or years to come.

Create A Budget (And Stick To It!)

Before you even start to look at different locations or activities, make a general budget. Doing so helps you create a general idea of how much you will need to save before your trip, and also realize what locations are realistic within your budget.

When you are determining your budget, consider the costs of travel, lodging, activities, travel insurance, food, and other miscellaneous expenses.

Start To Save

The best way to avoid the negative aftermath of financial debt after a vacation is to start early and save. Look at ways to save by examining your monthly bills and expenses and creating a list of where the money goes each month.

Once you have compiled this list, label what is genuinely essential each month. Things like rent, utilities, a grocery store budget, loans and other bills are all the things you need to pay each month.

Next, look at what you don’t necessarily “need” each month, but are expenses that you want. Things like pedicures, expensive coffees, shopping or eating out at restaurants. Figure out ways you can cut out these expenses and save money for your vacation.

Can you make coffee at home and save $5 a day? Or pack a lunch instead of ordering in every day? If you can spare a few dollars every day then it can go a long way to saving for your vacation.

Budget For Fun Activities

Paying for a trip requires more than just lodging and airfare expenses. Likely, you will want to do some activities when you are at your destination. Between museums, food tours, ziplining or shopping, you should investigate what sort of activities you might want to do on vacation and budget accordingly.

Look up if there are any free walking tours, free museum days, or other free activities you can do to help offset the costs of vacations. Knowing what you can afford beforehand can be a smart way to stick to your budget.

Use Your Credit Card To Your Advantage

Many credit cards will reward you based on what you spend. A credit card like the VentureOne Rewards Credit Card from Capital One (NYSE: COF) gives you a bonus of 50,000 miles when you spend $3,000 within three months of the account opening.

Make the rewards work for you by using the points to book airfare, hotels, or use it to get cashback. When you use your credit card responsibility, you can bank up more reward points to use on your next trip!

Posted-In: Education Travel Top Stories Personal Finance General Best of Benzinga


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