A Step-by-Step Guide to Financially Sustainable Travel in Retirement

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Nearly 40% of American workers say they want an adventurous retirement filled with travel and exploration, according to a survey from Edelman Financial Engines (EFE). Yet over one-third of Americans say that their perfect retirement lifestyle feels financially unattainable. 

If traveling is high on your retirement bucket list, planning for it early can make it more achievable without draining your retirement savings. Here’s a step-by-step guide to help you build a retirement travel plan that’s both exciting and sustainable.

Know Your Travel Priorities

Not all travel looks the same. Do you dream of annual international vacations or more frequent but shorter trips? Start by asking yourself what’s most important: is it the destinations, the length of trips or the experiences you want to have? 

Knowing your priorities gives you a clearer picture of how travel fits into your retirement lifestyle and helps you avoid overspending on things that don’t matter to you.

Set a Realistic Budget

Once you know your priorities, build a budget around them. A good rule of thumb is to allocate a percentage of your retirement income, say 5%-10%, to travel. For example, if your retirement income is $50,000 a year, setting aside $2,500 to $5,000 annually gives you a clear boundary to work within. That way, you’ll be setting limits without sacrificing everyday comfort for travel splurges. 

When building your travel budget, don’t just think about flights and hotels. Remember to include hidden expenses like travel insurance, baggage fees, meals, local transportation and activities.  

Travel During Off-Peak Season

Timing matters, especially if you’re traveling on a budget. Flights, hotels and even tours are often priced based on demand, and that demand peaks during summer months and holidays. Traveling during those times almost always means spending more.

Instead, plan to travel during shoulder season, the period just before or after peak season. You’ll not only save hundreds of dollars on airfare and hotels, but you’ll also enjoy smaller crowds, shorter lines and a more relaxed atmosphere at popular destinations.

Consider Alternative Accommodations

Hotels are convenient, but they can quickly eat into your travel budget, especially for longer stays. You may want to consider alternative accommodations, like vacation rentals, house-sitting opportunities or even home exchanges, which can significantly cut costs. And if you’re open to adventure, RV travel can also be a cost-effective way to explore multiple destinations without spending more on lodging.

Plan For Healthcare on the Road

In addition to the cost of travel in retirement, health isn’t something to overlook. If you’re traveling within the U.S., Medicare covers most medical needs, but it won’t cover healthcare abroad. For this reason, you need additional insurance for traveling during retirement. Travel insurance with medical coverage can go a long way.

Take Advantage of Discounts

One of the perks of retirement is access to a variety of discounts. Many airlines, hotels and tour operators offer senior or retiree discounts that can add up to significant savings. Also, many credit cards offer travel rewards that can stretch your budget further.

Build Flexibility Into Your Plans

Flexibility is one of the easiest ways to make retirement travel financially sustainable. For example, being open to flying midweek instead of on weekends or choosing a nearby destination when airfare spikes can save you hundreds of dollars. The same applies to traveling at off-peak hours, like early morning or late evening, adjusting your length of stay or the type of accommodations you choose.

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