Travel doesn’t have to be expensive but it does cost money. If you want to start traveling but know that in order to do so you need to make tweaks to your budget then the first thing that I recommend doing is starting a travel fund.
In this episode we cover:
- What is a travel fund?
- Why is a travel fund important?
- How to get started with a travel fund?
- Where to stash your travel savings?
What is a travel fund?
A travel fund is a powerful tool that you can use to help you save money for travel.
A travel fund is a dedicated bank account (checking, savings or money market) devoted to your travel savings and expenses. With a travel fund you’re intentionally saving money for travel and when it comes time to spend, you have a stash to pull from.
The point of a travel fund is to have money available for travel when you need it.
Why is a travel fund important?
A travel fund is important because it’s so much easier to save money for travel when it has its own home – a dedicated bank account separate from everything else.
#1 It’s a lot easier when you keep things separate
When you commingle funds you are less likely to achieve your goals. Even with the best intentions, it’s easy to overspend when all of your money is jumbled together in one bank account.
So if you ever have to pay for a flight or want to go on a spontaneous weekend getaway, you can tap into the funds you set aside specifically for travel expenses like flights, lodging, attractions and more.
#2 Avoids overspending
A travel fund can also help you avoid getting into debt and paying high balances on your credit card. At a glance you can check your balance and know exactly how much you have available to spend on travel.
#3 Keeps you grounded
A travel fund can keep your wanderlust in check and brings clarity to your finances.
Treat travel like a recurring bill
How important is travel to you?
If travel is important then consider treating it like a recurring bill. As a recurring bill you’ll set money aside for it every single month. Put travel right up their with your car insurance, rent and gym membership.
Make travel a financial priority in your life by including it as a line item in your monthly budget.
If you treat travel like a recurring bill you can potentially save hundreds or maybe thousands of dollars by the end of the year. It all depends on how aggressively you want to save for it.
How to implement it?
To do this, I recommend setting up a direct deposit with your employer. This way your money will get directly deposited into your travel bank account every time you get paid.
Helpful Tip: Don’t wait for the day after or even the week after to make this transaction, do it when you get paid.
The set up process is easy.
Here’s how to set up your travel fund:
- Figure out how much you want to save towards travel every pay period.
- Set up direct deposit with your employer.
- Go about your life – set it, forget it and watch it grow!
Now if you want to schedule additional automatic transfers after you get paid to accelerate reaching your travel goals, by all means go for it! I believe in you!
See you next time for Episode 3 where we chat with Richelle Gamlam about teaching English in China!
New to the podcast? Learn what The Thought Card is all about by listening to Episode 1.
Do you have a travel fund? Why or why not?
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