How we make room in our budget for vacations.
- Sydney McBride
- Feb 8, 2020
- 4 min read
Some of my most cherished memories as a child include going on family vacations. It
would always be so exciting waking up early to a loaded car and my mom frantically
running around trying to do her last minute packing while making sure we had
plenty of snacks for the road.
My parents had decided that making memories as a family would be a top priority,
and for that I will be forever thankful!
As an adult, I now realize how easy it is to get lost in the saving and planning for the
next thing, which results in vacations getting stuck on the back burner. There will ALWAYS be something on the horizon to plan and save money for. The next house, the next car, a puppy, babies, retirement, the list could go on and on. And if you’re anything like Bryan and I, saving and planning for vacations was at the bottom of our priority list.
We just kept thinking to ourselves “we can’t really afford it right now, it’s not the
right time to be setting money aside for unnecessary things like that”. But let me tell
you, vacations (no matter how big or small) are a necessity and should be a priority!
How often you go and how far you travel is totally up to you. But everyone deserves
to get away and spend quality time with your loved ones every now and then. I’m a
firm believer in collecting memories over material things.
So, I’ll fill you in on our vacation savings plan and how we have decided to make it
happen! Back when we first started laying out our finances in preparation for house
hunting (read about that here), we came up with a simple budgeting technique that
would allow us to save money for vacations while also motivating us to spend less
each month SIMULTANEOUSLY. What the whattt??
We went ahead and opened up a brand new “Vacation Savings Account” that also
earns interest. Yes, you heard that right! A savings account dedicated solely to
vacations. That way, whatever money we are pushing in to this account will be
earning interest as it sits over time (since we will not be touching the money until
vacation time!) So, if we are spending less, where does the money come from that goes in to this account? I thought you’d never ask!
When we laid out our budget, we set budgeted amounts for various spending
categories (i.e. groceries, bills, gas, misc. spending, etc.) that we would do everything
in our power not to go over. Like eat beans and cornbread for example, which I
actually really enjoy. And even better if we come in under budget, because you know
what that means? VACATION BABY.
That’s right! At the end of the month, we subtract the amount budgeted from the
amount actually spent in each category and if there’s a surplus (there better be a
surplus) we just transfer the extra money over to the vacation savings account.
You see, every dollar is already planned and accounted for, and every penny has a
place. This enables us to continually be setting aside the same amount of money in
our general savings while also being able to save for vacations without feeling like
we are scrimping and sacrificing anywhere else.
And like I said previously, it seriously motivates me to stay on track with my
spending (that means even more reason to put down those cinnamon rolls, Bluebell,
or Drumsticks that weren’t on my grocery list).
Should I lay this concept out with some numbers? Let’s do it!
So, say you have budgeted $300 per month on groceries. Each time you go grocery
shopping, keep a running total for the month. At the end of the month, say all of your
grocery bills add up to $250 total (for easy math’s sake…I am a writer after all). This
means that at the very end of the month (the very end…not one or two days before
just in case you make an unplanned visit to the store and spend $20 satisfying those
random cravings), you should transfer the remaining $50 into your vacation savings
account and DON’T TOUCH IT. Obviously the amounts you transfer will vary from month to month, but don’t worry if you only get to set aside $10 or $20 at a time. Over time, you should get better at saving, and plus every bit counts!
You can use this concept with every category of your budget: for example, groceries,
utility bills, fun spending money, etc. or just keep it small and simple with one
category. It’s all up to what your situation is, so make it work for you! You could also
adopt this method to make extra payments on debts such as mortgages or student
loans faster. The possibilities are endless!
In addition to staying under budget on our pre-planned purchases, we also try to stay under budget with our “fun” money. Each month, we have a set amount of fun spending money that we take out in cash. We use this for things such as eating out, splurging on popcorn and a movie, or candles that smell irresistible at Target (okay, Bryan’s never bought a candle, and 90% of our indulgence purchases happen at Chick-fil-A, but you get the point). When the cash runs out, the unnecessary purchases end. We love this method of budgeting because we each have freedom with our “allowances”, yet not too much freedom that results in making mindless purchases on a credit card that we end up forgetting about. Because everything is paid for with cold, hard cash, it’s so easy to keep track of what you’ve spent and what you have left. Because we are saving up for a super fun upcoming vacation, we’ve been extra motivated to cut back on spicy chicken sandwiches each month, and we save whatever we have left over at the end of the month. When it’s time for vacation, we will pull this money out and use it for food and shopping! It’s not always easy, and we don’t always have money leftover at the end of the month, but it works for us.
The important thing is realizing that there are practical ways to save up money for
the things you want and value. We value paying off debt and being able to take
vacations that we don’t feel guilty about. You don’t have to use reusable toilet paper
or be an extreme couponer to work towards your financial goals, just be practical
and do the best you can, one grocery trip at a time.
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