8 Practical Ways To Save Money For Travel (Or For Life In General)

iStockPhoto.com / Ondine32
iStockPhoto.com / Ondine32

I am a frugal person – it’s always been that way. Growing up, I witnessed how my single mother struggled to make ends meet. I enrolled in public schools; I studied hard and applied for scholarships to get extra allowance to fund my school projects. That taught me the value of hard-earned money.

When I was already earning my own moolah, I was blessed to be surrounded with people who shared bits and pieces of wisdom about savings and investment. I honestly didn’t understand all those information at that time. But I did it anyway knowing that at least, my money is going somewhere and I’m not just splurging every payday. I started planting my own seeds early and gradually understood how far a good savings account can take me. Now, I am thankful for my old self for having done just that.

I realize that saving doesn’t come naturally to most of us though so here are some tried and tested tips I’ve been following myself.

Pay off your debts.

Whether to save for travel or not, one thing anyone needs to eliminate first is DEBT. It’s hard to make your financial goals happen if there’s a debt waiting to be paid every month. Avoid expenses that lure you to 0% or monthly instalments. As much as it sounds like you’re getting a good deal, more often than not, you’re not. These monthly installments are what add up progressively and impact your finances in the long run.

Make use of credit cards.

Wait, what? I thought you said to get rid of debts? I hear you, but credit cards can be useful too. In fact, most travel hackers use credit cards to earn airline miles without really having to spend on a flight. If you’re not into acquiring miles, you can still earn points and rebates that you can exchange for great rewards.

The key to earning points while evading debt is to pay off everything before your due date so as to not incur an interest. I have one credit card I use to pay for almost everything – bills, groceries, movies, dinners, or occasional binge. I have enjoyed some free dining experiences and grocery rebates in return because of the accumulated points.

It takes discipline and a great amount of self-control to master the art of using credit cards. Before you swipe (or tap) the plastic, ask yourself: “Is this something that I can pay in full cash today?” If the answer is no, don’t do it.

Setup automatic transfers.

Create a separate account for your savings, preferably, without an ATM card. This way, you will not be able to withdraw your money on a whim. Then, setup automatic transfer from your main account to your savings account on your payday (or a day after your payday). When your income is credited to your main account, a percentage (or the amount you indicated) will automatically transfer to your savings account helping you practice the golden rule of saving: Income – Savings = Expenses.

Create an emergency fund.

Take note that this fund is different from your savings. Emergency fund is only meant for, well, “emergency”. Financial planners suggest that you should at least build 3-6 months of expenses within your emergency fund. There are no rules though. If it’s too much, you can start with at least one month. Just start.

“Another way to be prepared is to think negatively. Yes, I’m a great optimist. But, when trying to make a decision, I often think of the worst case scenario. I call it ‘the eaten by wolves factor.’ If I do something, what’s the most terrible thing that could happen? Would I be eaten by wolves? One thing that makes it possible to be an optimist, is if you have a contingency plan for when all hell breaks loose. There are a lot of things I don’t worry about, because I have a plan in place if they do.”

I love this excerpt from Randy Pausch’s The Last Lecture about planning ahead. There’s something about having money set aside for emergencies that can ease worries and help you meet your other goals, whether it’s financial, for business, or for leisure. I am able to travel and worry less about bills, because I know that I can return home with something to fall back on in case an emergency happens and I’m still recovering my savings. Since this fund is reserved for crisis, it’s usually untouched so it can also be useful for when you’re applying for a visa that requires financial statements; you can show them your emergency fund statement of account as proof.

Save that ‘extra’ income.

Whether it’s overtime pay, a tip, or a 13th month bonus, separate it right away from your disposable account and deposit it to your savings account. Think of this, if you can live just fine with your usual income, then you won’t need to spend that ‘extra’ as well. It’s totally okay to treat yourself after all your hard work. You can take off 10 or 30 percent maybe to pamper yourself but try not to be a one-day millionaire.

Do not spend the money that isn’t yet in your hand.

This is an addition to the previous point. We tend to get excited and instinctively spend in advance when we know we have a supplementary income coming. Whether it’s a 13th month bonus at the end of the year, a salary increase by next month or a profit from an extra job next week, if it is not yet on hand, try not to spend it. This will help you be mindful of your spending habits. And it’s always good to have that extra income sit in your bank account for months (or years!) rather than just letting it slide through to pay bills.

Simplify your meals.

Replace fast food and take-out meals with home-cooked meals. Prepare your lunch and bring it to your workplace. Cut down on overpriced coffee. A few dollars may not seem like much but it significantly adds up over time.

I know this is not as simple as it sounds especially if you already struggle with time management and a lot of responsibilities. Controlling yourself from constantly eating fast food and take-out meals take as much discipline as cutting down time scrolling on Facebook, but it’s worth it. Your pocket and your weight will thank you later.

Change your mindset.

It is common for people to say things like “I don’t have money”, or “I’m broke”. It could be true or not. But here’s the thing, if you have work to go to, food to eat a few times a day, or several clothes to wear in a week – you definitely have money! You may not have everything but you are blessed enough to have all that you need. You’ll dream bigger and accomplish things more if you don’t limit yourself with how much you have in your pocket (or bank account). Get out of your comfort zone, who knows when an opportunity may come your way.

At the end of the day, saving is all about smart spending. It’s not how much you make but how little you spend that matters. Whether it’s for a brand new car, a continuing study, or retirement — intentional saving is necessary to achieve your goals. Thought Catalog Logo Mark

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