Creating a travel fund to finance your adventures
Many of us would wish to travel the world, but we perceive it as being “too expensive.” Traveling on a budget or raising the money seems impractical or unachievable. The reality is most people who travel do so with shoestring budgets and after months of preparing. The first time may be challenging, but after you get used to it, it gets easier.
If traveling is an activity you derive pleasure from, you should make it a priority by creating a travel fund. Here is how to get started.
- Shift money towards your travel fund
The first step in setting up a travel fund is finding out how much traveling might cost you. Estimate how much you may need based on proper research. After figuring out how much you will need and with a date in mind for your vacation, calculate how much you need to set aside each month to reach your goal. If you don’t have enough money to save every month for this goal, try shaving off unnecessary expenditure like eating out or drinking alcohol. If reducing spending is not an option, look for ways to make more income.
- Figure out where to put your travel fund
You have to find the best place to store your contributions. It has to be a safe location that keeps your money out of sight while giving you access when you need it. A savings account is a good choice, but the little interest it earns does little to grow your money. You need an investment vehicle. Travel is a short-term goal, and like all short-term goals, the desire for good returns must be balanced with risk. Look for investments that suit this goal. Investors Hangout is a great place to start. Investing in stock and bonds, for example, can grow your money, and you will be able to liquidate it when it is time for your vacation.
- Use your travel fund
Using your travel fund is not as easy as it sounds. When you have raised enough money and completed making your vacation plans, you can then pool your travel fund and hit the road.
If your money is tied down in investments, liquefy them and move the funds into your primary checking account. Ideally, you will have set your investments to mature in time for your vacation. Traveling with all this cash is not advisable since you might lose it. Use a cre preferably one that will earn you rewards and not incur interest. If your investments are not mature or in case you do not want to sell your stock at a loss, you can use a credit card and pay the bill later when you can liquefy them for a profit.
If you budget your trips wisely and take advantage of deals and offers, your travel fund should be more than enough to finance your vacation. You might even have some money left over in your fund after the holiday. Keep this as liquid cash to finance spontaneous trips over the weekend or bolster it further for a grander vacation the next time.