If you find yourself struggling each year to scrape up $1,000 to take the family on a much-needed vacation, you could be approaching this all wrong. Make a smart investment and reap the benefits, making it much easier on yourself. Let’s take a look at some smart ways to fund your annual trip.
Instead of saving $1,000 for a small trip, how about investing $20,000 at a conservative 5% and take a “free” trip every year? You still keep the $20,000. $20K x .05 = $1000! You’ve made a smart investment yet you’ve made the money you need to take your trip, all with no work on your part. This is a great example of letting your money work FOR you.
Create a Separate Account
Lumping in your vacation savings with your regular savings is an exercise in futility. If the money’s there in front of you, you will spend it. At least that’s how most people operate. Resist this urge with some strategic saving. Nowhere is the saying “out of sight, out of mind” more applicable. Open a separate account for investing in annual trips. Add a little bit out of your paycheck, or better yet, have it automatically deposited so you never miss it.
Plan it Out
If you know where you want to go and what you want to do, sit down and budget everything out. This is how you’ll know just how much you need to sock away each year for the annual trip with your buddies to Vegas or your family vaca to Disney. Being able to focus on a target amount is key so you know you’ll have enough when the time comes. In your budget, include costs such as:
- Car rental
- Meal plans
Once you have the total projected cost, divide it by the number of weeks until your planned vacation starts and this will tell you how much you have to save each week to make your trip a reality.
Invest Your Tax Return
Getting a solid tax return in April is a nice little bonus, but remember, it’s not found money. It’s yours that you earned, so think of it like an investment. Don’t even cash it and be tempted to buy that new wardrobe. Invest it right away into your account of choice. In general, you don’t really want to be getting a huge tax return at the end of the year. Instead of loaning your money to the government interest free, set that money aside throughout the year to earn interest on it and treat yourself to a bigger and better trip, advises Money Crashers.
Do Something on the Side
If your regular salary isn’t enough to fund the vacations you really want to go on, take matters into your own hands and start up a side business. This is easier than ever thanks to the Internet. If you have 100 bucks and a great idea, you can design your own website and start selling. Or, try your hand at something else like becoming an Uber driver, networking on Upwork, or selling your crafts on Etsy. Put the profits you make right into the vacation investment plan. If you do really well with your business, in a few years you can sell it off and add that lump sum to the account as well. No more scrimping for you!
To manage your investment plans, whether for vacations, college or retirement, you may decide to enlist the help of a financial planner or stock broker who can manage your portfolio. Just be careful who you trust, as not everyone is looking out for your best interests. That’s why it’s always good to have a stock fraud lawyer on your side. Call Thomas Law Group now to find out how we can help.