Money Saving Advice
There's more than one way to get most for your money. For more than 20 years, Gary Foreman has worked to manage money effectively. He's been a Certified Financial Planner and Purchasing Manager. He currently edits The Dollar Stretcher Web site and several newsletters. His mission is to help people "Live Better for Less."
The Dollar Stretcher: Guilt Free Vacations
By Gary Foreman
I am looking for guidelines on how much money to spend on travel/vacation.
We are a family of three living on about $45,000 per year. Twice each year
my son and I travel to see my family. On one of those trips my husband
accompanies us. We spend almost no money once there. So that is 5 round
trip plane tickets each year. In addition, I would like for the three of us
to take a family vacation each year.
My question is how much is reasonable to spend total? Are there any
rules-of-thumb? Percentages or something? We have no debt other than our
home and are vigorous savers, which leads to guilt when spending. So I want
to know how much is reasonable to spend so that I don't feel guilty about it.
Dora's right. Feeling guilty about your vacation spending sure can ruin a
According to the Travel Industry Association we spent $584 billion on
travel last year. The average family will spend in excess of $2,200 a year
on an extended vacation. Despite a recession and terrorist activities, 57%
of Americans plan to take a pleasure trip during the first half of 2002.
That adds up to a lot of vacation spending!
But, average spending numbers can be misleading. In many ways travel is a
form of entertainment that happens away from home. And every family has
different patterns of recreational spending.
For instance, some people prefer to spread their activities throughout the
year. They spend on movies, sports and other entertainment regularly. Other
families save all year and splurge on a vacation. Still others have little
to spend and make the most out of long weekends while staying close to
home. The goal is to get the most enjoyment from the money you spend. So
choose what works best for you.
Can Dora come up with an amount that should be budgeted for vacations?
Sure! According to the U.S. Statistical Abstract a little less than 10% of
the money we spend goes to recreation. So, in Dora's case that would be in
the $4,000 to $4,500 range. Remember, that includes all forms of recreation
so she'll need to subtract money going for other forms of entertainment.
While it's possible for Dora to apply that number to her family, it might
not be a good idea. A better method might be to see how their recreation
spending fits in with the entire budget. For instance, Dora's family
doesn't have a car payment or credit card debt. So there's more money
available for things like vacations. She probably can afford to spend a
little more than average.
There's another way for Dora evaluate their spending. That's to look for
the warning signs that you're spending too much. A big one is paying for
the vacation after you've taken it. It's hard to have a good time when you
know that you're spending money that you don't have. Saving the money
before the trip can free you to thoroughly enjoy yourself.
Another warning is when saving or paying for your vacation becomes a
burden. Providing food, shelter, education and health care to your family
comes before trips to visit family and friends.
Once Dora's convinced that she's not spending too much for vacations, what
can she do to relax and enjoy her trips?
Know your budget before you leave. Plan your spending for transportation,
lodging, food, amusements and souvenirs. If the plans are reasonable
there's no reason to second guess them later.
Remember that the rules are a little different on vacation. Eating in
restaurants will be expensive. Sometimes you won't be able to find the
absolute cheapest motel in town. And, that's ok. As long as you're staying
within your budget and not being foolish don't fixate on how much you're
spending. Don't let unnecessary money concerns ruin a good time.
That's not to say that Dora should abandon her frugal life style. There's
nothing wrong with a lunch of sandwiches at a city park or scenic turnoff.
Her family may find that needless spending makes them uncomfortable.
Finally, Dora might want to earmark some of the money that she routinely
saves for use on vacation. That will help her to stay disciplined during
the year. And she'll be more comfortable spending money that's been
specifically saved for this purpose.
Hopefully Dora will make some wonderful memories with her family. Bon Voyage!
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Gary Foreman is a former purchasing manager who currently edits The Dollar Stretcher Web site www.stretcher.com. Contact Gary at email@example.com. You'll find hundreds of free articles to save you time and money. Visit today!