Dave Ramsey: How To Save For a Vacation in 6 Easy Steps

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Vacations are a time to make memories with family and friends and to enjoy your free time away from work and responsibilities. Despite continued inflation, a whopping 40% of Americans plan to travel more in 2024 versus 2023, according to Forbes.

Considering how expensive everything has gotten, you’ll want to be sure to save accordingly for your next vacation. Luckily, there’s a method to follow that can help.

6 Steps To Easily Save For A Vacation

Here are the six steps to save for a vacation, according to Ramsey Solutions.

Decide when you’ll travel: Choosing when you’ll take your next vacation is the first step. Consider checking off-season prices, flying on Tuesdays or Wednesdays to save on airfare, and organizing your travel dates so that the trips start on a Sunday night rather than a Friday night. Flying and staying at a hotel over a weekend tends to be more expensive.

Pick your destination: Next, you’ll want to pick exactly where you’re going. Consider a tropical getaway at a fabulous beach destination, visiting a national park, camping, or perhaps hiking in the mountains. While the most important part of your trip is to make memories, if you choose a nice place that’s a little bit less touristy and perhaps off the beaten path, you could save even more.

Determine cost: Determining at least an approximate total trip cost before departing is key. There are many costs associated with a vacation, including but not limited to airfare, hotels/accommodations, ground transportation, car rentals, tickets, food, drinks, tips, etc. These costs can add up quickly, especially if you’re traveling with your whole family. Consider utilizing budget travel websites to score some deals as well as credit card rewards programs. If you can use points or miles to book the flights, hotels, or both then that’s even better.

Create a budget: Once you’ve narrowed down the expense categories, set a budget for each type of expense. For example, you might only have $1,000 to spend on a hotel, $400 to spend on flights, $150 per day to spend on food, and so on. You can use a financial app to help you organize your budget, or use the old-fashioned pen-and-paper method and simply write everything out.

Grow your vacation savings: Now that you’ve set your budget, you’ll want to start saving for your trip as soon as possible. Whether it’s asking for a raise at your job, taking on a side hustle to make extra cash, or putting some funds each week into a high-yield savings account, finding ways to increase your earnings and grow your money is key. If you have some discretionary income each month, consider allocating it toward your vacation fund rather than another dinner out or a night at the bar with friends.

Track your spending while on vacation: This last step might be the most important. You’ve set a budget and you’ve successfully saved for your vacation. Each day, be sure to check your spending categories. If possible, you won’t want to exceed your budget in any of the categories. Doing so can result in extra cash needed to cover your bills and could lead to subsequent credit card debt.

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