With all the focus on Christmas and the New Year, we know your summer holiday is probably the last thing on your mind. However, once the festive season dies down and your finances recover, it could be well worth thinking about the next big expense you’ve got coming up – your summer holiday. You might not be feeling too summery with the cold and wet weather outside your window but remember – the sooner you start to think about it, the more time you’ll have to save up.
To give you an idea of how to begin this process, here are a few helpful tips:
Start with a budget
As with any big purchase, drawing up a budget will help you to make sure you’re spending what you can afford to. When it comes to figuring out a budget for your summer holiday, think about your budget in terms of each person.
If you’ve got children under the age of two, they can sometimes travel for free depending on the holiday provider. However, it’s still a good idea to factor any expenses for them into your budget, just in case there’s no availability on these holidays. Under 17s will still pay child prices but if they’re over this age you’ll have to remember to budget for them as an adult. If they’re earning, you could ask them to contribute towards the holiday.
Don’t forget about extras like travel insurance (you could be covered for this on your home insurance – so double check!), travel money, car hire as well as everyday necessities like holiday clothes, food and drink, entertainment and any holiday treats, e.g. organised excursions. The figure that you get once you’ve added all of these costs together is your final savings goal.
Draw up a savings plan
Now that you’ve got a figure to work with, you can start setting up a savings plan. Think about when you’d like to head away on holiday (or when you need to travel, if you’ve got kids in school) and work out how much you’ll need to save each week to achieve this goal.
It’s important that you’re realistic when doing this, by starting with a small manageable sum that you can work towards each week and then increasing this closer to the time if needs be. For an idea of how long it will take you to reach your savings goal, use the Money Advice Service’s Savings Calculator.
You could go one step further by opening a separate savings account for a standing order to be paid into every month. This way you’ll be able to think of it as just paying another bill off every month.
It can be hard to get inspired to save when you can’t visualise what the final outcome of this saving will be. So do a bit of research around where you’d like to travel to this summer. Whether it’s a family trip to Florida or a city break in Venice, having an idea of where you’d like to go will help to keep you motivated.
You could label your savings account with the name of the goal, or stick pictures up of your dream destination – whatever you need to do to stay motivated!