Work out how much you can afford
Before you book a holiday, you need to know how much you can afford to spend. Doing a budget will help you see:
- How much you spend each week or month
- Where you can cut spending
- How much you can save
Be realistic about your budget and don’t forget one-off-costs that can pop up. Use your bank statements to see how you’ve spent your money over the last 12 months. Read how to budget for help with doing your budget plan.
After your budget is done, you then need to decide how much you are prepared to save for your holiday each month. This will help you to set a savings goal.
Set a savings goal
A savings goal is the total amount of money you want to save by a certain date. To set your savings goal you should:
- Decide on the holiday you want and how much it costs (use a travel comparison website or travel catalogue)
- List and estimate the cost of all other expenses such as clothes, shoes, transport, insurance or luggage
- Decide when you want to go away
- Add up how many months there are before your preferred holiday date
How much to save each month to reach your savings goal
Divide the total cost of your holiday by the number of months left before you go away. This will give you the minimum amount you need to save each month to reach your goal.
For example, if your holiday costs €500 and you start saving 6 months before the date, you’ll need to save about €83 a month. If you start saving 3 months before the date, you’ll need to save €166 a month.
Be realistic about how much you can save each month based on your budget. This will make sure you reach your savings goal when expected.
Now that you know how much you want to save each month, put your savings into a separate bank, post office or credit union account. This way you cannot access it too easily and this will stop you from spending that money. Even if it’s a little amount every month, over time you’ll have a nice amount to go towards your holiday.
You can get more advice about how to build savings.
Not having money to spare is what stops a lot of people from saving. Some things you can do to help you find some extra money include:
- Finding a better deal on your household bills
- Checking you’re getting all the social welfare benefits you’re entitled to
- Reviewing your spending on non-essential costs
Lower your holiday costs
You can save money on your holidays just like any other expense. Below are some tips to keep your costs as low as possible, making sure you are relaxed when you come back home, and not stressed about your finances.
Be flexible: Travelling at quieter times can cost you less than travelling during busy times like school holidays.
Book your own holiday: Avoid travel agents as they are normally more costly. Look for deals on the internet and set an email alert for when a good deal on flights comes up. Remember to stay safe online and avoid scams.
Book early: Some package holidays and hotels have early booking offers.
Use public transport: This will be much cheaper than getting taxis or private buses.
Go self-catering: Paying for and cooking your own food should work out a lot cheaper than having it cooked for you.
Keep your bags light when flying: The charges for extra kilos for luggage are very high.
Set a spending limit: Set a limit for each family member on how much can be spent on souvenirs. Or, even better, have a ‘no souvenir policy’ with family and friends back home.
Get more help from MABS
If you’re struggling to manage your money or you feel like borrowing more is the only solution, help is available, contact MABS.