Vacations don't have to make a big dent in your finances if you plan well ahead.Hemera Technologies
It happens to most of us: We return from one vacation anxious to plan the next. And now that March break is over, some people may already be thinking about their summer sojourns. Fortunately, the experts have some tips to help would-be vacationers come up with the cash to help finance the fun.
"You might be surprised at what you can afford if you just give yourself some time to save up," said Shawnnette Fraser, manager of customer experience at TD Canada Trust in Calgary.
Socking away just $40 each week between now and the beginning of summer means more than $500 in savings for a vacation fund, and almost double that amount by Labour Day. And, that doesn't include any interest accrued, depending on how the money is being squirreled away.
Ms. Fraser said people should first consider their destination and associated costs for getting - and staying - there. Then, they should design a painless savings plan through automatic payday withdrawals from their main account to a special savings account.
And although it may be tough, to help save for that vacation, Ms. Fraser advises cutting discretionary spending such as movie night at the theatre as well as pricey takeout coffee and lunches. Instead, rent movies and bring food and beverages to work from home.
"You always have to make sure to sit down, decide where you want to go, what you can afford, and then backtrack from there," Ms. Fraser said.
Last fall, the annual Expedia.com vacation deprivation survey of more than 7,000 adults from 20 countries, including Canada, asked respondents what prevented them from planning their vacation in advance.
One quarter said planning depended on their work schedule, and 22 per cent blamed their lack of planning on worries about the economy, while another 15 per cent cited some other reason. However, almost half said nothing affects their ability to plan a vacation.
Canadians largely mirrored the global results, although only 15 per cent said planning was contingent on the economy and more than half said external factors don't affect vacation planning.
Lesley Keyter, also known as the Travel Lady in Calgary, said forward planning is always a good idea and a smart way to save money.
"You'd be surprised," she said, "I've got people now booking for Christmas vacations. Doesn't that seem crazy?"
It's particularly peculiar in a culture of the last-minute discount vacation. But most people - such as those with children and inflexible work schedules - need to plan. That can also mean savings, according to Ms. Keyter. Early booking bonuses sometimes include waived fuel surcharges. Some packages also allow a deposit of a few hundred dollars with final payment not due until shortly before departure, which gives people time to save. Try using travel points acquired through loyalty or credit cards programs.
Ms. Keyter also said when cost is a concern, people should think about what they are willing to sacrifice, such as hotel star ratings, location or meal plans.
The Expedia survey also asked respondents about their financial situation. Compared with the rest of the world, Canadians reported the strongest comfort level. Twenty per cent described their finances as "solid," 42 per cent said "good," and 30 per cent said "fair." Just 9 per cent said "poor."
Since vacations are really nothing more than larger-scale discretionary spending, people shouldn't let themselves get carried away.
"Saving for a vacation should not supersede any of your financial obligations," said Ms. Fraser of TD Canada Trust, "Setting aside money for a vacation shouldn't disrupt savings that you have for your financial goals, such as maybe saving for a house or paying for your mortgage, or saving for your retirement and other debt repayment."