After an entire year spent in lockdown trying to survive the pandemic, we all deserve a little R&R. Fortunately, COVID-19 restrictions are being lifted, and vaccines are becoming more widely distributed. But one question remains — are you financially ready for a vacation? If you thought you needed a break in previous years, you’re probably dying to take one in 2021. If you thought you needed a holiday in the last year, you’re probably failing to take one in 2021.
If you’re looking to plan a trip shortly, here are six tips to make sure you’re financially prepared.
debit card that helps you save money automatically. These cards will round up every purchase you make to the nearest dollar. The round-up amount is then added to your savings account. This is a painless way to save that requires zero work.
flight comparison tools to see all your choices. You can snag a deal if you’re flexible about what airline you fly or what day/time you leave.
You can also compare prices for places to stay. By browsing Airbnb and comparing hotel prices, you will find something that fits your budget and needs. You’ll also be forced to ask yourself the tough questions, though. What’s more important to you: price, location, or lots of space? How many bedrooms would you be willing to settle for? The list goes on.
When all’s said and done, you should be able to identify a place that accommodates your needs and your price point. Check comparison tools frequently and build your budget around what you find.
4. Leverage airline points and miles
If you were a frequent flyer pre-COVID, there has never been a better time than now to use your points. Due to the pandemic, many airlines have become more lenient in handling points and rewards. Airlines want to keep loyal customers; many extend miles, issues, and elite status to customers.
If you were sitting on frequent flyer miles, there’s a good chance they’re still good, thanks to the extensions airlines offer. Be sure to check the status of your miles as you plan your next trip. A free flight to your destination will make your vacation much more financially feasible.
5. Have a ‘vacation emergency fund’ for splurging
The first time you venture beyond your city or state, you will want to make it worthwhile. Let’s face it; you’re likely to splurge a little bit while you’re on vacation. After all, you’ve probably been cooped up in the house for about a year. This YOLO impulse is fine, so long as you plan for it.
Transportation and a place to stay are both essential. But think about other expenses, too. Do you plan on cooking every meal at your destination or eating out while you’re there? Either way, you’ll have to buy food.
Will you want to shop? Are you planning fun activities? Even if you don’t have your exact itinerary, budget for the “just in cases” and “gotta haves.”
Look into money-saving apps to start saving extra money for your trip. Within these apps, you can set savings goals for your vacation and link your checking account. Most apps will have an algorithm for calculating how much is transferred to your savings account.
6. Take advantage of credit card rewards
It would help if you didn’t have to abuse your credit card(s) to afford a vacation. However, if you have a healthy relationship with your credit card and some rewards to use, why not take advantage?
Check out credit cards that are geared toward travelers. Some yield double miles for every dollar spent or let you use points to book flights and hotels with no blackout dates. If you’re considering traveling abroad, cards with no foreign transaction fees will make your overseas adventure more affordable.
Like the idea of sailing through airport checkpoints? Some cards will even credit up to $100 of your application fee for the TSA PreCheck and Global Entry programs.
When the time comes to take a vacation, you should be able to spend guilt-free. Taking the necessary steps now will not only help you afford your vacation, but it will also make your vacation more enjoyable. Your future self will thank you when you’re enjoying a holiday free from both pandemic anxiety and financial stress.