Disclaimer: I’m not a professional budgeteer or an accountant or a businesswoman or even a math teacher. I just really want to travel as much as I can, so I’ve researched and taught myself some pretty basic strategies on saving enough money in order to do so! (I also just really like numbers, so that helps.) One last thing–none of these strategies are just out of the way unheard of, but they’ve honestly changed everything for us!
It’s a common misconception that you have to be rich or at least pretty well off to travel. I have many times heard the question, “How do you afford to go to all these places?” Or I have talked to people who presume my husband makes a lot of money (because they know I don’t). While once again I’d like to emphasize that I am by no means a budgeting expert, it’s simply not true that you have to have a large bank account or income or that you have to wait for days to come when you might have those things (it’s exactly that sort of mentality that’s the reason why some people never live out their dreams of seeing new places). Do you have to be at a fairly decent and stable place money-wise? Of course. But it’s never too early to start planning and saving.
Without the measures of monetary self-discipline we’ve put into place over the last couple of years (particularly the last year), we would not be able to travel–regardless of what our income is or has been. And that’s really what it all boils down to–a little bit of self-discipline. Seriously!
A couple more things upfront you should know for the sake of transparency (so that you know it isn’t all a ruse):
- Our mortgage is higher than anyone else’s I know (not that I go around asking or anything…)
- We have two car payments.
- We currently have two credit cards (so I’m not pretending to pay for everything out of pocket–We’re just good about not taking advantage of those cards and paying a significant but reasonable amount toward them every month).
- I’m currently not making a dime off of this blog (so, unfortunately, I’m not making some significant side income that’s mysteriously paying for everything).
Just start saving! Whether it’s $5 or $20 or $100 a week, just do it! Don’t shoot yourself down just because your salary stinks. Don’t give up just because at $5 a week it will take a long time for you to save up enough. Because all it takes is that first $5 for you to actually be on the road to making your plans happen, and that’s all you need–is to be on the road.
We had no specific goals when we first began saving. Every week at the grocery store, I’d get cash back. It was no specific amount; it was just whatever amount I thought we could reasonably afford at the time. Sometimes it was $10 or $20 and never more than $40.
Make sure you set it aside somehow. It has to be clear from the start that this money is your traveling money only. Promise yourself: We will not touch this (except, of course, to periodically count it and become giddy with pleasant surprise and excitement over how much it has accumulated). Buy a jar and hide it in a special place. Or open up an account, an account you can’t easily transfer money out of. You have to set ground rules for yourself because if you don’t, you’ll find yourself dipping into it for other “needs.” Have a separate savings for other needs! A different place–the emergency fund or the general savings, if you will.
If you’re in a good place financially (or when you are), you need to follow the 50-20-30 budget plan. I only did a little research on this plan before I started it, so I’m not sure if there is anything more involved with it than what I do but it works absolutely perfectly for us. We have been saving more money than ever before. I’d like to emphasize first that this plan in no way restricts you from spending money on the things that you want, but it does, however, give you a limit. Our biggest issue was too much unnecessary spending. So here’s the idea:
*Everything is based on your monthly income, so you have to calculate this first.*
50% of your monthly income goes toward bills.
- We are actually currently at 51% (because like I said, I pay quite a bit toward our two credit cards), but that’s okay! It actually varies depending on what our electric bill is (hah!), so I recalculate every month.
- If you calculate and you’re actually under 50%, that’s wonderful, but I recommend that if you have credit cards you pay more towards them to put yourself at that mark (of course, start with the lowest balance first!-Ramsey).
20% of your monthly income goes toward your savings.
- For me, that includes a “general” savings and a traveling savings. This number, for me, was the exciting number–the realization that we could and should be saving this much money a month was incredible, and it opened us up to all sorts of new possibilities! And actually, this is where we carved out that extra 1% from the bills, so really this number was only 19%.
- Because we already have a fairly decent “general” savings built up, only about a fourth of that total amount goes toward it; the rest goes toward traveling.
30% of your monthly income goes toward “flexible” spending.
- For me, this includes gas, groceries, and and all other spending money.
Let’s look at a hypothetical monthly income and how it would break down: $4000
- At first, when I calculated our own number, I tried to divide it out over a span of four weeks, but then I realized that it wouldn’t be possible for us–some weeks we have no bills and other weeks we have all the bills, and I am only paid once a month. So here’s what I do: I set aside a standard number to go in both savings accounts each week. The remaining amount left in this part of the budget I put in there when I am paid (that one time of the month we have significantly extra money). In other words, I set aside a set amount weekly and monthly. You just have to figure out what will work for you and your income! As long as it all equals out to the 20% ($800 in this case) a month, you’re good!
- This is a number you would divide out over the four weeks, so in this case, it would be $300 a week. Divide it reasonably.
- Establish how much you have to spend on gas a week (add about $5-10 to that amount).
- Establish how much you typically spend on food and other household necessities a week (once again, add a little more).
- The remainder gets to be whatever you want it to be. I call it our “recreational” fund. This is my husband’s favorite fund. He hates dealing with money and budgeting, but he more than willingly keeps up with this number so that he knows what all he can buy for himself that week! 🙂 It gets him on board with the whole plan!
***So, if your income were $4,000 a month and you put aside half of your savings budget for the month, that would be $400 a month–that’s $4,800 a year just for traveling! If you were to set aside three-quarters of it (as we do), that’d be $600 a month, which would amount to $7,200 a year! That’s more than one trip by the way, depending on what you plan on doing.