Summer is around the corner and many families are working on plans for summer vacations.  Vacation spending, in my mind, can be similar to Christmas spending.  If you’re not careful, or haven’t saved in advance, you can end up with a credit card mess to clean up.  No body likes a Christmas spending hang-over and you definitely don’t want a vacation spending hang-over either.

The most important thing to remember is to plan or budget your vacation spending.  If you have a plan, your chances of over spending, or spending outside of what you can afford, will greatly decrease.  And there’s nothing worse than experiencing spending anxiety while you’re supposed to be relaxing and having fun.   Establishing a spending budget will bring you some peace of mind during your vacation.

So, here are some tips to get you started in budgeting and spending wisely on this summer’s vacation.

6 vacation budgeting & spending tips

Plan a summer vacation on a budget

As I mentioned, the most important part to managing your summer spending is to have a budget, or spending plan.  It’s important to know what you can afford before deciding what you’ll be doing for your vacation.  Set your limit and agree to that limit with your spouse (if married) well in advance of beginning your vacation.   Not everyone can afford a family vacation to a far away island with aqua blue water.  And that’s okay.  The important thing is to be content.  Vacations are about getting the rest you need and having some fun.

Subdivide your spending into categories

If you’re used to using a monthly budget why not create the same thing for your vacation?  You can divide your overall budget or spending limit by categories such as transportation, food, entertainment and extra spending money.   If you know what you want to spend for airplane tickets, or gas (if driving) this may help in determining your destination.  You wouldn’t want to spend 70% of your budget on transportation to be left with very little entertainment money while at your destination.

Reduce expenses

Just like you would with a family budget, look over the categories of your summer vacation and determine where you can widdle away at costs.  Do you really need that much money for entertainment each day?  This is where you can begin researching to find coupons, identify alternative sources of entertainment and use creative ideas (as with the next tip).  Check lodging specials for Hotels and know when they run.  If you’re flexible on travel dates you can reduce transportation and hoteling vacation costs greatly.  The point being, get creative and put some time into researching how you can reduce your expenses.

Make your money go further by spending smart

While on vacation remember you don’t have to have to go out to the most expensive restaurants, or even eat out every single meal.  Many times we have planned to eat groceries for breakfast and lunch and eat out at a restaurant for dinner.  This saves a considerable amount of money considering most hotel and vacation area restaurants are quite pricey.  There is nothing wrong with having a styrofoam ice chest with food in the corner of the hotel room. 

Use cash when you can

Although it might not be wise to travel with a lot of cash, I like the idea of using cash while at your destination.  Consider going to a bank once you arrive at your destination and take out cash.  Put the money in envelopes and use that money according to your daily plan.  It’s sort of your like you’ve paid each day in advance and you don’t have to worry about tracking spending for credit or debt transactions.  Just make sure you find a safe place for the cash such as in a safe.  If security is a concern you might try to use a convenient ATM each day.  Most major Hotels have them today.

Establish a vacation allowance for family members

After all, it is vacation, so you get to take a little bit of a financial management vacation too, right?  Consider giving each family member a daily allowance for spending.  They can manage their own spending envelopes depending on how they want to divide up the money for purchases.  Of course, children need additional guidance, but mom and dad can manage their spending allowance, or blow money in this way.  For example, let’s say that our blow money allowance allows for my wife and I to each have $25 for the day (just throwing out a number).  At the beginning of the week, or day we each get our $25 to manage and spend as we please.  There is little for the money manager to do now and your spouse or family member can enjoy some freedom in spending as they please.

What are your tips for a financially wise, or spending smart vacation?

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