Start Planning Now: 11 Steps to Affording an Amazing Trip in 2016


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Dream vacations may seem impossible to orchestrate -- so many logistics! So much money! -- but starting now makes it easier to get an amazing trip underway by the end of the year. Although it involves long-term planning and daily effort, sacrifice, and stress, take heart: Identifying a vacation goal in advance makes for successful budgeting, and the process can be fun on its own. Here are 11 steps to saving enough money, starting now, for a fantastic trip by the end of the year.


The first step to ensuring a great trip by the end of the year: Create a dedicated bank account for vacation savings, separate from other checking and savings accounts. Most banks let customers set up automated transfers from their primary accounts into a separate account. The new vacation account should see only deposits. No dipping into it when life happens -- that's what an emergency fund is for. Having a dedicated vacation account makes it easy to see at a glance how much you've saved, and then how much you have to spend while traveling. (Just make sure the spending won't incur penalties if the balance dips below a minimum.)


It's impossible to make a budget without a very clear understanding of the costs associated with the chosen destination. Everything needs to be accounted for, from flights and accommodations to meals and ticket prices for attractions. Make a general itinerary and dive into online resources such as travel blogs and official tourism websites, as well as published travel guides (get the most recent!) from a library or bookstore. Watch out for seasonal fluctuations; costs and crowd sizes can vary widely from high season to shoulder season to off-peak times, based on weather, local religious observances, and a variety of other factors. Remember that there might also be expenses before jetting off, such as passport fees, travel insurance, pet care, and phone service. Upon arrival, is it cheaper to rent a car or feasible to use public transit? If relevant, what's the currency exchange rate? What are tipping customs? It may seem overwhelming, but that's why it's key to start researching early.


After researching all the associated costs, tally up a total for the entire trip -- erring on the high end so there are no surprises down the line. Online trip budgeting tools from sites such as Budget Worksheets, Independent Traveler, and Practical Money Skills can help sum things up and keep items from being overlooked. Custom spreadsheets can be built in Excel or Google Docs. Once you settle on a final figure, it's time to calculate how much to save per month (or even per week or day) to hit that number. Turn to free online savings tools such as SmartyPig and plug in the ballpark total and departure date.


If any existing savings can go into the vacation fund, determine that now and adjust the budget accordingly. An annual bonus or a tax refund might fully or partially go toward the vacation, as might any windfall or inheritance -- provided there aren't other priorities such as debt to pay down. Transfer the available money now so there's no temptation to spend it elsewhere. That immediately brings down the savings needed for vacation, although it's still important to start saving now to reach whatever amount remains.


The monthly savings requirement for a vacation budget can be daunting on top of other bills and necessary expenses. Sacrifices may be necessary. Look at actual household spending and consider how to cut costs (and put the family on a budget now if there isn't one already). Cable TV can probably be the first to go, in favor of a cheap online streaming service, and readers can borrow from the library and find free ebooks instead of buying. There are plenty of other cuts to be made and ways to reduce fixed costs, such as home and insurance payments.


Small change adds up, so institute an old-school coin jar. Label it with something inspiring such as "Hawaii Fund!" or "Bon Voyage!" and toss in spare change every day. It's fun to watch the jar fill up, and it can be surprising how quickly the money accumulates. Another way to save pennies is to cut out those little fees and expenses, which also add up fast. Make it a rule never to use an ATM that will incur a fee; drink coffee only at home or at the office; say no to drinks in restaurants (or even at home). Institute a test: Do I want to order dessert, or do I want to go to Italy next Christmas?


A family vacation should ideally involve every member of the family who's old enough to understand money and sacrifices. Talking to kids about money can help them understand that, if they get an allowance, they should chip in to the vacation savings account. To provide incentive, adults can point out that souvenirs, treats, and other extras come from that fund, so the more money that's in there, the more exciting the trip will be. Are other relatives willing to contribute funds to allow the children to travel? proposes that kids apply for an all-in-the-family travel grant.


It's essential to keep the vacation savings on track, particularly if flights and accommodations will be booked well in advance. Have family meetings where the adults monitor the account. If monthly contributions are lagging, the budget may need adjusting -- and expectations for the vacation also may need to change. Count up the coin jar savings too, or convert its contents to cash and put that money into the fund. (Note that supermarket converters take up to 8 percent of the change. Try a local bank instead.) Stay on top of that vacation savings account so there are no surprises once the anticipated date arrives.


A vacation budget doesn't just have to come from money saved; it can also come from extra money earned. Most people have unwanted and unused books, clothing, video games and DVDs, and knickknacks lying around that can sell online or in an old-fashioned garage sale for some extra dough. Members of the family might consider getting a side job, such as tutoring, babysitting, sewing and alterations, yard work, or any service that might bring in funds. It's also possible that pleasurable hobbies could generate some side money, not to mention the fact a home can earn money while a family is away: Consider putting your home up for short-term rental on a site such as Airbnb.


Once a destination has been chosen, there's a chance somebody else might help pay for the trip -- a long shot, but worth investigation. For students and teachers, the most likely candidates for aid, niche research grants can help offset the cost of a vacation, though they may not cover the whole trip. Some nonprofit organizations, private institutions, and government agencies also offer travel grants for training or other specialized purposes, sometimes only for members of their own organizations. (For instance, Rotary International funds some travel related to member projects.) A volunteer vacation might be worth looking into as well, but the budget shouldn't depend on a potential travel grant.


Saving for a vacation can put stress and strain on a household, but keeping the end goal in mind can help keep everyone motivated and excited. Put up little reminders of the destination, such as pictures or a screensaver. Talk about the place beyond money -- explore its quirks and interesting facts, its history, the residents' lifestyle. Eat the food and listen to the music of that locale, and look forward to enjoying it authentically once vacation time arrives. Watch YouTube videos about the language and accent, and encourage the family to practice it for fun. Drawing inspiration for the future vacation, and keeping that dream alive, makes saving less painful and easier to achieve.