Skip to main content

Tips to Save For Vacation

With the average family of four vacation costing between $3,000 and $6,000, planning how you will save for vacation may be as important as deciding where you will go. 

It might be overwhelming to think about that trip to Disney World or Napa if you wait until the last minute to plan and pay for it. You might also be paying for it long past the vacation if you didn’t budget and charged everything on a credit card. To make sure the memories are as enjoyable as the vacation, start early and plan out the details. Make sure you’re saving enough so you don’t have to worry and can enjoy your time away. 

Common costs for a vacation include: 

  • Transportation – are you driving, flying, or taking a train? 
  • Lodging – are you staying with family, in a hotel or an Airbnb? 
  • Food – are you eating out or going to a grocery store? 
  • Entertainment – will you see any shows, go to attractions or lie on the beach? 
  • Miscellaneous – do you need rental or travel insurance? What will you do if your luggage is lost? 

After you determine where you plan to vacation and how you will arrive, estimate the total cost of the vacation and how far into the future you plan to take the trip. Then divide the total cost by the number of months until the planned vacation and that is how much you will need to save each month to avoid going into debt. For example, if you plan to take a $5,000 vacation in 10 months, you will need to save $500 each month toward your vacation. 

If the amount you need to save each month seems impossible, consider waiting longer to take your vacation so you can divide the cost over a longer period. Consider trimming expenses by renting a less expensive car, driving yourself or refining your restaurant choices to be more budget friendly. You may also want to consider cutting expenses at home for a while to help build your vacation savings. Eating out less, lowering your thermostat or cutting monthly subscriptions may help close the gap to affording your vacation. 

If the monthly savings amount is realistic but you don’t have the discipline to save each month, consider starting a special automated savings account. Most banks will let you create recurring transfers from one account to a dedicated account.  

Saving for vacation takes discipline but once you create the habit of saving money, vacations become more possible and hopefully more frequent. It can be extra rewarding knowing that you had a great vacation and can start saving right away for your next trip rather than working to pay off that credit card from your last vacation.