How to Budget for Travel

I want to go on vacation so bad right now. These cooler temperatures are especially making me want to travel north and see all the fall leaves that I don't really get here in Oklahoma. This time last year, Jordan and I were in South Dakota having a great time seeing Mount Rushmore and staying in our little cabin in the woods.

Every single vacation we've been on since we got married has been fully budgeted for before we left. There are plenty of blog posts about traveling on a budget, but I thought I would share with you how we budget for travel throughout the year and why (we think) it's a good idea. Some people act like traveling is no big thing and everyone can do it easily, but I feel like that's not true for everyone. Traveling is a big deal for us, and it's something we save up for and don't do very often.

The advantage to budgeting for your travel before you go is this: completely guilt-free spending the whole time you're gone. If you know you have enough money in the budget to go on vacation, you don't have to worry about going to a fancy restaurant for dinner one night or buying some souvenirs. You won't get back from your trip to wherever and spend the next six months paying off your credit card... it's already paid for!

In order to budget for travel, we do a few things:

1. Set up a separate travel savings account.

I've talked before about the Capital One savings account we have set up. It's a bank account separate from your credit card or regular bank where you can create multiple accounts for different things. So, for example: we have one Capital One account with smaller accounts within it. One for our house fund (which is now our 3-6 months living expenses), one for travel, one for Christmas, etc. This keeps your travel money completely separate from any other money you have, so it's easy to tell how much you have to work with. If you're interested in learning more about our Capital One account, here is a referral link!

2. Make an automatic payment into the travel account every month.

How much you put in is up to you. We have it set up to automatically move $50 from our regular bank account into the travel fund every month. If we happen to have extra at the end of the month after paying our bills, we can decide if we want to put some of that money into our travel fund. Sometimes we put a couple hundred dollars extra; sometimes we don't put any extra money into the fund, but by putting a certain amount automatically, we're always putting something into the travel fund, and it can sit there and accrue interest. Fifty dollars isn't a lot, but it's something, and every dollar adds up!

Here is a recent example where doing this paid off for us: 

This past June, I went to the Bahamas on a work trip, and at the last minute we decided Jordan was going to come along with me. He was staying in the hotel room with me (paid for by my work), but we were responsible for paying for Jordan's flight, which was going to be over $500. At first I freaked out and was like, "We don't have an extra $500 to spend in the budget!" But then I looked in the travel fund and realized we had more than enough to cover the flight. We just transferred the money back into our bank account and paid for the flight without any problems.

3. Start saving early for specific trips.

Okay, so we automatically put money into the travel fund each month, but that's just so we can keep something in there and use for short-notice trips and short, inexpensive weekend vacations. If we know we will be going on a specific vacation, we start putting more money each month into our travel fund (on top of the automatic payment). 

For example: Jordan and I are currently saving for a trip to Europe in the fall of 2016. We don't know any logistics like exactly when we're go, if we'll take R, or even if we'll end up going, but we want to go and we are saving money to go. We started saving at the beginning of this year and will put money into our travel fund the rest of this year and next. The plan is that by the time we go to Europe, we will have enough money saved to pay for our trip!

Of course, when we go on vacation, we don't know exactly how much we will be spending while we're gone. It's impossible to know how much you'll spend on food and things like that, but you do know how much your flight or hotel will be and whether or not you plan on buying tickets to a museum or other local attraction. The idea is just to have enough money to cover the basic expenses and things we think we'll be doing so that we don't have guilt about spending money and having fun.

So that's what we do to create and maintain our travel fund and save up for trips. We love not having to pay off our credit card after we come back. That's no fun at all.

Here is a great way to jump-start your savings if you aren't used to putting money aside. It's a 52-week challenge where you save one dollar for each week of the year ($1 for week 1, $2 for week 2, $3 for week 3, all the way to $52 for week 52). By the end of the year, you have over $1,300! You can even double this and put aside $2 for week 1, $4 for week 2, etc., and have $2,600 at the end of the year if you plan on going on a more expensive vacation.

I'd love to know what you do to budget for travel (or if you budget for travel). We're always looking for good tips and ways to be even better about saving!

Do you have a travel fund in your budget? How do you budget for travel?