Easy Ways to Go on Your Dream Vacation Without Breaking the Bank

How many times have you drawn up a list of destinations that you want to visit and then kept the paper away? Too many times to be precise? And you did it coz though you love travelling but realised that with your bank balance you could only take a trip till your balcony or living room. Fret not, there are easy ways in which you can save up for that dream vacation without feeling the pinch. Hena Mehta, Co-founder and CEO, Basis a financial services platform for women, powered by education and communities, tells us that with proper planning you can have tick off the dream vacation from your bucket list and also have a stress-free travel experience! Hena shares some effective tips below.

Create your travel fund

Now that you have a total amount you will need, you have two options to finance your trip - either plan in advance with your savings and investments, or take a loan/use a credit card. (There are other options which are clearly not good ideas - such as tapping into your retirement or emergency funds. Let’s not even go there...)

“The best recommendation here is saving and investing, of course. Set up your investments in advance (don’t forget to factor in inflation - travel gets expensive year on year), and you’ll be all set with your travel fund!” says Hena.  The Basis app has a goal planning tool which factors in travel inflation rates, and recommends mutual funds that you can invest into to get to that dream vacation travel fund goal! For instance, let’s say you are saving up for a big 30th birthday bash trip in 2024, three years from now, and you’ve estimated you will need ₹2 lakh for it (in today’s terms). The goal planning tool on Basis - assuming you are ok taking moderately aggressive risk on this investment - estimates you’ll have to start putting away ₹6,500 a month as an SIP into an equity mutual fund. If you choose to opt for a loan, keep in mind that that can get very expensive due to high interest rates on personal loans or delayed credit-card debt.

Estimate the Budget

As with any expense, you need to estimate the amount you expect to spend. Be as thorough as possible. Travel not only includes the obvious expenses such as flights, hotels and meals - but you’ll also spend on things such as local transportation, visa costs (if you are traveling abroad), a shopping budget, and sight-seeing costs. Remember to include a buffer or indulgence fund - so you don’t feel guilty about splurging a little when you’re on holiday (including those duty-free buys)! Also note that in some cases, off season travel can be more pocket-friendly. Consider this if you are flexible on dates!

Consider these travel hacks that will save you money

Use a prepaid forex card instead of swiping your credit or debit card: Apart from ensuring that you stick to the planned budget, prepaid forex cards are cheaper than charges levied on debit or credit cards. If that is not reason enough, consider safety against theft with available assistance/blocking cards in case of an emergency, and the convenience of using a single card across multiple countries. 

Get travel insurance: Accidents, illnesses, theft, etc can cost you a lot while traveling. Don’t forget to get travel insurance, which are available in multiple variants, starting as low as ₹ 70 per day for travel within Asia. The travel insurance you need varies from country to country depending on health care costs. Look into what the comprehensive amount is for the specific country you are travelling to.

Explore free local experiences: Now, this really depends on your interests, but there are creative ways of exploring your travel destination without paying those crazy tourist fees. Local free walking guided tours, for example, are not uncommon any more. With a bit of research, you can find several cultural tours/UNESCO World Heritage sites, which are free or negligibly priced – book in advance to ensure you are not disappointed on tour.