So you’re getting ready to head out on vacation. We’re jealous. As part of any well-planned trip, creating a vacation checklist—including financial aspects—is essential. Perhaps you’ve decided to go all-in on that mid-career sabbatical and you’re ready to take some much-needed time off. Maybe you’re about to take that weeklong trip to Mexico.
Whether you’re headed out for just a few days or stretching beach bum status for a few months, travel can get expensive. Domestic travelers spent $880 billion in the U.S. in 2017, $258 billion of which was spent on food alone. Aside from making sure you packed your phone charger and contact lens solution, planning a vacation checklist will help you prepare financially before you hit the road.
Funding Your Vacation
Is your vacation fully funded? Be sure you estimate vacation costs, including airfare, accommodations, transportation, food, drinks, fun activities, and any shopping or souvenir buying you might do. A fun five-day vacation loses some of it, well, fun if you’re still paying it off three months later.
A great way to avoid going into debt for a vacation is to estimate your vacation costs upfront and then set aside a travel allowance each month. Use fare comparison sites like Expedia or Booking.com to get an idea of how much your trip will cost. The top two spending categories for domestic and international travelers are food and lodging , so make sure you include these expenses.
Add up the totals to get an estimate and then divide the total by the number of months before you take your trip. Then you can set aside a monthly allowance which will hopefully be what you need by the time you travel. For example, if you estimated $1,000 for a trip to Florida in five months, plan on setting aside around $200 each month into a designated travel account.
Designate a Vacation Financial Planner
This doesn’t have to be someone you hire, but someone who will hold you accountable and keep you from going overboard. Think of a vacation financial planner as someone who can accurately forecast travel expenses and anticipate unforeseen expenses, like extra cab rides to and from the airport or tips for tour guides.
Being able to plan for these types of expenses can potentially help you feel more at ease while on vacation. Instead of waking up each day in paradise in a cold sweat because you forgot about the 10% hotel daily surcharge, you’ll hopefully wake feeling well-rested and ready for that fancy umbrella topped drink.
Credit or Cash?
How will you spend money while you’re on vacation? Whether you take cash, credit, or a bit of both, decide on how you will make purchases. If you are traveling internationally, be aware of foreign transaction fees with credit cards, currency exchange rates, and one time change fees when converting cash into foreign currency.
Finance your vacation with a travel credit card, but be sure you have enough cash to cover all travel expenses. Select a credit card that has travel advantages, like zero foreign transaction fees and rewards travel purchases such as rental car bookings and dining out.
By using one card during your vacation, it makes it easier to review associated transactions at the end of the month. You also may rack up more rewards points when you use a card that’s specifically tied to travel.
SoFi Money has you covered.
Cash also has its advantages whether you’re laying oceanside or hiking a new trail. When you use cash during vacation, you don’t want the hassle of logging on to a credit card account and paying your bill after the fact.
Try taking a $20 bill (or the country’s equivalent) out with you during the day and see how far you get. Using cash encourages more of an emotional attachment to the money versus swiping plastic. You may think twice about the souvenir magnet that costs $12, thus saving you money while in vacation mode.
Alternatively, you may choose to use a debit card that withdraws money directly from your checking account. A more organized approach could be a separate checking account with debit card privileges that’s specifically for vacation use only. This way, you keep ordinary transactions separate from vacation transactions.
Money for Miscellaneous
Be sure to include money for miscellaneous vacation expenses as part of your vacation checklist. Trekking across New York City and using Google Maps on your phone to get around? App usage may drain your battery, resulting in the need for a portable charger on the fly. Try your best to account for any unexpected expenses that might occur.
Consider setting aside $50 for miscellaneous expenses like earplugs for noisy hotel rooms, cold and cough medicine for travel-related illnesses, or replacement contact lens solution and a toothbrush if you forget yours somewhere.
Create Travel Notifications
Create a travel notification when preparing for a trip. Call your credit card and bank companies and let them know the dates and locations of your vacation.
This will prevent any temporary holds or freezes companies will put on your account if they see unusual activity. Call seven days prior to departure to ensure your travel notification is ready to go when you are.
Account for any bills that might be due while you are away. Make sure automatic payments are put into place or pay bills before you go. There’s nothing worse than coming home from a great vacation only to find you’ve been slapped with late fees on a cell phone or internet bill that you forgot to pay.
Bring the Confirmation
If you pre-booked your transportation or accommodations, bringing payment confirmation along with the credit or debit card you used to pay will help expedite the check-in process.
Often times, the receipt will include a confirmation or reference number which can help the service desk member find your reservation more quickly and can help dispute any discrepancies in charges.
Okay, Now You’re Ready to Go
Planning for a vacation can be stressful. Dealing with unexpected expenses can make it worse. Fortunately, with a vacation checklist, vacation financial planner, and a way to finance your vacation, the whole process can be much easier, letting you lay back, relax, and enjoy.
Want to make it easy to finance your next adventure? Set up a SoFi Money® cash management accounts account charges no account fees (subject to change). Learn how to get the most out of SoFi Money.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC . Neither SoFi nor its affiliates is a bank.