Now that you know how much money you’re going to actually need for your trip, creating a savings budget is pretty simple (actually sticking to it may be another story…).
Take your summary from STEP EIGHT when you did your spendings budget back out again:
COSTS AT HOME: $1,700
TOTAL FOR TRIP: $11,950
Work out what cash flow you already have going towards your trip. For example, you may have already started saving a bit, you may be entitled to some holiday pay while you’re away, or maybe you know that you’re going to be getting a half decent tax return.
NEED: $11,950MINUS:Annual leave pay $2,000Already saved $1,500Tax return $500 (approx)TOTAL: $4,000
Easy maths: how much do you need between now and when you want to start your trip?
Currently: January 2017Travel starts: January 2018Need: $7,950
Break it down to less scary numbers:
1. Need $330 per person, per month for 12 months2. We both get paid fortnightly, so we each need to put away $165 per pay
And that’s pretty much all there is to this part! Like I said, once you know roughly how much you’re expecting to spend on your trip, it’s super easy to work out what to save. Sticking to the budget can be hard, but one of the best things I’ve ever done was to open a separate travel bank account. Now, every pay day, whatever I need for my next trip goes straight into that separate account, not to be touched until I start booking and paying for it.
7 thoughts on “Logistics of travel – part 3: How to create your savings budget”
Jess, these series are really interesting and I haven’t seen anyone write about it. While I am not planning RTW travel any time soon, it is fascinating to see how much work and planning it takes.
Thank you so much Nano! I’m hoping it’ll encourage a few more people to plan trips, even if they’re only a few weeks long 🙂
Absolutely! It sounds like a perfect adventure!