We’ve talked before about how loans can help finance your travels, like how looking into an unsecured loan can quickly bring you toward your savings goal for a big trip. Today we want to discuss another way to save up for your dream trip – opening up a second savings account. Is it truly necessary to have different accounts? Why not using your own personal account, instead? What benefits can you gain from it?
Why Have Two Different Savings Accounts?
Saving money is important; everyone knows that. And everyone knows that it’s easier said than done as well. However there are several things you can do to create a good system to save toward your travel goals.
Whether you are itching for a quick weekend trip or dreaming of long-term travel, a special savings account can help you focus on saving your money for a specific purpose. Once the money goes in, it doesn’t come out until it is travel time.
You often hear of people automatically taking 10% out of their paychecks to put into savings. Once you’ve paid your monthly bills, set aside a certain amount (whether it’s a percentage of your overall earnings or a set amount) each month for your special travel savings. At first you may not think you have the extra money to make regular contributions, but try looking at your regular spending and see what you can cut? Is it that regular trip to the corner coffee shop? Thursday evening happy hours? After a while any little savings adds up and, depending on where you’re going, they can add up big time.
When it comes time to travel, you will have a clear idea of the money you saved specifically for the trip and how to budget. By having a special savings account, you’ll also be better off coming back home since your regular savings will still be in place.
Having a special savings account for travel money along with a loan (Tip: use a loan calculator online to figure out how it will help and fit into your financial situation) can set you up to successfully finance any trip.
Making – and Reaching – Your Goals
Keep your eye on the prize – er, trip! Have a clear idea of why you’re saving and what you want to do with the money. How will it make your life, and travels, easier to have that designated stash of dough? Also have a clear idea of what costs will be like wherever you’re going – street food in Thailand will often cost $1-2 per plate. With that in mind, it will be easier to forgo the usual $4 latte.