Wouldn’t that just be living the dream! Keep putting money away towards retirement or that dream house and travel regularly. But does it really need to be a dream? Provide you are lucky enough to live and work, or at least earn money through, a developed country and hold with a passport that makes it easy to travel abroad, saving and travel aren’t mutually exclusive.
Yes you’ll save faster if you don’t travel. You’ll probably have a more luxurious or longer trip if you aren’t trying to build that future nest egg. But if what you need to feel fulfilled is to have a little of both?
Start making conscious choices
Every choice we make in life actually involves making two choices – the choice to do something and the choice not to do something else. Staying in a secure job that offers great security and good pay, even if it’s not your dream job, might be a choice you are making. But you are also choosing not to look for an alternative job. By choosing to renovate the house you are choosing not to allocate that money and the time you’ll spend renovating elsewhere.
If you are conscious of these two alternative choices then you can also be sure that you are picking the alternative that you are happy to live with. Sure you might enjoy travel but right now having a new kitchen or regular pay means more to you. Or you might decide you are happy to put up with that old oven because you would rather have a holiday than a shiny new stove.
What are the choices you and your family have made in your life? Do they support your dreams of saving and travel? What changes can you make to make your life fit your dreams more? And are there choices that you aren’t happy to make to fit your dreams? It’s worth figuring that out.
What are your saving goals? And your travel goals? If you want to have both you’ll need to be realistic. If you are putting money aside to do both you need to manage your expectations a little. Paying off the house in ten years might not be realistic if you still want to travel but there’s no reason you can’t still save and aim to pay it off in 20 instead. That month long luxury trip to Italy might not be possible if you want to keep working on your retirement fund. Perhaps you need to consider a backpacking adventure through Italy instead, select a cheaper destination, save for longer or go for less time if those fancy hotels in Venice are still calling to you!
You may find that you need to make a choice between which one is slightly more important to you or put a time limit on it. For instance our choice at the moment is that until we’re 40 we’re going to prioritise family holidays over saving, although we’re still trying to save. But after we reach 40 we plan to prioritise saving and investment more than travel, although travel will still be important. Three years left!
What things in your life can you sacrifice to help make your two priorities of saving and travel happen? Obviously, you have to eat, but beyond the necessities, learn to put your travel and savings fund first. There will be sacrifices. Meals out, concerts, parties, going out with friends, fancy Christmas presents, new furniture and cars. You don’t need to be ruthless and cut every luxury out of your life but if you identify the difference between your WANTS and NEEDS and work out which wants you are happy to sacrifice in order to make your dreams happen it’s not hard.
Remember it’s your conscious choice to make both travel and saving for your future your priority. You won’t regret your sacrifices if you remember that it’s your choice. And it comes with a big reward – financial security and amazing holidays!
Make your money work for you
If you want to save significant money for your future and for travel, then you want every dollar that you are put away to get the best possible return. You may want to consider a high interest savings account, term deposit or even an investment portfolio. For UK residents, you may want to consider having a cash and investment ISA. By having your savings in both you can make the most of your tax free offsets and be able to put some of your money into higher risks investments while still having some in more conservative saving plans.
Pay yourself first
When you get paid, put a percentage aside for these two goals. It should go to a fund or place you won’t touch or even think about. Rather than transferring what you have left at the end of the month after everything else is paid, transfer it out first.
If an emergency arises you can always access it – it’s your money. But chances are if you’ve already put that money aside you’ll think long and hard before touching and find another way to deal with the emergency.
Look for ways to save
Reduce your debt by rolling any loans into one. Get rid of multiple credit cards. Reduce your bills – do you need that higher mobile phone plan? Do you need those extra channels on your cable TV package? Is that gym membership necessary or can you take up jogging? Do you really need that second car? Can you cut your petrol bill and home bills in any way? Look for online discounts?
Take a packed lunch to work more often and bring your own coffee from home. Meal plan when you grocery shop and eat takeaway less. Entertain at home or organise weekly rotating dinner parties amongst friends rather than meeting out. You don’t have to kill your social life, just change it a little. Make the most of free days and cheaper locals days.
Find a credit card that gives you reward points for travel. Look for travel specials ahead of time.
They’re all small things but they add up over time. Keep your goals in focus – amazing holidays and financial security. You’ll get through those hard days and soon be sitting on a beach somewhere enjoying amazing holiday dreaming about a day one day soon when maybe thanks to your hard work this could be your life forever.