My Savings Plan

Lots of bloggers write about their adventures traveling the world, and people like myself read about those travels jealously from home wishing it was them out there… Well, it IS going to be me out there, but I’m still in the planning phases of my trip: something NOT a lot of bloggers write about. So, I will!

I have done a lot of research to try to figure out how much money I’ll really need to travel for months at a time. This obviously depends entirely on where in the world you are headed (Europe will cost you a LOT more than South East Asia), the level of comfort you intend to experience in your accommodations and transportation (will you ride the bus or fly everywhere?), how much money you want to spend on stuff (clothes, gifts, etc.), how many activities and tours you want to take part in, and what type of eating habits you intend to keep.

Without having to think very long, I know I want to travel on as little money as I can. My budget will be strict because the money I manage to save will be the only money I have! So, I plan to stay in hostels or cheap budget hotels to keep those costs down as much as possible. When it comes to food, I plan to buy groceries, cook for myself, and eat street food when feasible, rather than eating in restaurants all the time. I plan to travel by bus and train rather than plane most of the time and keep the purchase of ‘things’ to a minimum.  What I do want to splurge on is tours and activities and hanging out with people I meet, and maybe on an occasional night in a private room.

After taking these things into consideration, I have decided that $50 a day is a reasonable budget. $50 a day adds up to about $1500 a month, and just over $18,000 a year (much less than I need to live at home!) I have also taken into consideration the price of at least two flights and travel insurance for the duration of the trip. All of this, along with the knowledge that it is easier to blow your budget than keep to it, and the fact that I have still not decided how long I want to be away, has led me to set a lofty savings goal for myself: $25,000. Even if I am able to amass this crazy amount of money by January 2014, and end up staying away for an entire year, I won’t spend it all on travel so that I have some money to come home to.

Now that I have the magic number pinpointed, I have to figure out how to hit that goal! This obviously will not be easy, and I will make adjustments as I go, but there are a few steps I have taken already to help me on my way:

1. I have moved out of my solo NYC apartment and in with family who are graciously allowing me to live rent free while I save. This is the only reason that saving that much money is even within the realm of possibility! It’s been a big change for me, but will be totally worth it in the end.

2. I have set up an automatic savings plan. Each time I get paid, my savings account automatically transfers a set amount of money from my checking into savings, a zone I now consider off limits- Once it is in there, it is not to come out! I might as well forget that money even exists.

3. I got an American Airlines AAdvantage Credit Card. While this doesn’t help me save money toward my goal, the ability to use accrued miles to pay for flights rather than dollars will essentially mean more money in my pocket. I got 30,000 bonus miles from the card and will continue to get 1 mile for every dollar spent on regular purchases. I’m not sure how many miles I will be able to collect, but if I can use miles to pay for my departing and return flights, I’ll be happy.

4. I use Mint.com to set strict spending budgets for myself each month. This tool helps me keep track of my spending and makes it very obvious when I am going over my desired limits (which I have during the last two months~ sigh). When those budget bars turn red, I know I need to do better. Though I have never been a BIG spender, limiting myself to the extent I need to in order to meet my goal is going to be my biggest challenge.

In the last few months I have managed to make some progress toward my goal, but still have a LONG way to go. So, I will keep this up for the next few months and then evaluate my progress at the end of the year. I hope I am doing enough! Does anyone have any other savings tips? I’d love to hear them!

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5 responses to “My Savings Plan

  1. I shall think on it!

  2. Love this review, and you’re right; very few travel bloggers talk about how to “pay” for their travels. Love you site!

  3. Pingback: My Savings Plan Improved | SoleJourner

  4. Great post! The devil’s in the details!

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