Taking a vacation at least once a year is quite important for renewing your strength especially after a busy work schedule.
Equally as important though is the quality time that a vacation affords you to spend with your family, away from the demands and stresses of everyday life.
But how should you finance your vacation?
• Avoid borrowing or incurring debt to finance your vacation.
• Dipping into your emergency funds to pay for your vacation is equally unwise and is generally not a good financial practice. The burden of rebuilding these funds could place unnecessary strain on your finances, especially if an emergency arises.
• Financing your vacation airfare via miles accumulated enables you to travel for a minimal fee (usually only taxes).
The ideal way to finance your vacation is to budget for it from your disposable income. Determining the amount of disposable income that you save for this event will require you to:
• Decide on your vacation destination;
• estimate the cost of your airfare, hotel, meals, tips and entertainment;
• estimate the cost of transport and sightseeing;
• cater for exigencies.
Working backwards from your intended vacation date would enable you to calculate the amount of money that you need to accumulate on a monthly basis in order to pay for the vacation. In the absence of such a plan, it may be a good idea to save at least 5% per month from your net income.
All- Inclusive Packages
One way to save on a vacation is to book an All-Inclusive package deal. This type of vacation is excellent for a family with young children as it offers great value for money. It also provides an excellent form of relaxation because of the facilities which are offered at such venues. Most All-Inclusive packages include all meals, various sporting activities and entertainment. They also offer special supervised activities for your children. All-Inclusive resorts offer great value for your money, privacy, security and an escape from the daily routine!
Facilities with a Kitchenette
These are ideal for large groups such as extended families. In this type of setting, there is usually a well furnished kitchen with all the amenities including utensils. You will usually though have to purchase groceries and prepare your own meals. This type of accommodation is usually much cheaper than staying in a regular hotel.
Time-share describes the shared ownership by several individuals in a piece of real estate in a given location. These are condominium-style units outfitted with 1-3 bedrooms, bathrooms, kitchen, living room that generally come fully furnished. Time-share involves purchasing property, so all the rules around purchasing property would have to be followed. Alternatively, if you know persons with available Time-shares , you might be able to negotiate use of these for a relatively small fee. You and your family can have a wonderful vacation at a fancy resort for a modest fee.
Develop a financial plan for your annual vacation and enjoy a debt-free holiday with your friends and/or family!