It sounds kind of obvious, but for me the budgeting starts as soon as we start discussing a holiday or looking at brochures. If you overstretch yourself, the run up to the holiday is no fun at all. Better to choose something you can avoid and have plenty of spending money to enjoy yourself while you are there.
2. Pay as large a deposit as you can afford
When you book your holiday, pay as large a deposit as you can afford. Paying a big whack off the balance in the beginning will make the installments (see tip 3) less painful.
3. Set your installments and stick to them!
Take the balance of your holiday and split it over the months remaining until the final payment is due – this is usually three months before departure, if it’s not aim to be finished three to four months ahead, this leaves you time to save your spending money. Don’t miss or pay less than the amount you have set, ‘pay yourself first’ and make your holiday a priority. Treat the balance as a debt, which technically it is.
Make a bit of extra cash from overtime? Receive a windfall or unexpected cash? Commit to putting any unexpected cash towards overpaying your installments. Depending on how fortunate you’ve been you can pay off your holiday earlier than expected – the ideal scenario.
5. Spending money
Once you’ve paid off your holiday (see tip 4) it’s time to turn your attention to spending money. Firstly, work out how much you expect to spend each day. Factor in food, drinks, souvenirs/shopping, excursions and entertainment. Once you have a figure, add a 20% buffer on for emergencies and overspending. Add up the total and that’s the figure you are aiming for.
6. Saving up spending money
Take your total figure and divide it by the amount of months left before your holiday. Do exactly as you did with the holiday and pay each spending money installment into a separate account.
7. Overpay, again!
If you receive any extra overpay on your installments and either meet your goal early and relax, or keep on building the pot so you have a bit more to spend.
8. Your daily budget
Know your daily budget and how much you have allocated, this will help you choose restaurants and entertainment that you can afford. There’s nothing worse than getting halfway through your holiday and finding there’s no money left!
9. Give kids a daily amount
Give kids a daily amount from the main budget. You may choose to buy ice creams and treats but it’s good for kids to have money of their own, it avoids all the ‘I wants’. I split the amount down into daily amounts, otherwise kids will often spend their entire budget on the first day and you’re back to square one. Give them a daily amount which they can allow to let accumulate if they want to purchase something more expensive.
10. The end of holiday blow out
If you’ve done your budgeting properly, you’ll probably have a bit of cash over. We usually like to arrange a shopping trip before we leave and the remainder is split between family members and we will all have a little blow out purchasing clothes etc to bring home with us. It’s great coming home with something to show from being away and it’s fun doing the shopping spree thing in a different place, even if it’s just a little one.
My budgeting tips for a stress free fun holiday!