Ask anyone what they'd do if they had more time and money, and you'll almost always get the same response: travel. So, when I began telling friends that my wife and I were going to spend the better part of the year globetrotting, I got used to seeing furrowed eyebrows and tilted heads.
After we decided to take more than a year to explore the world, we sat down and began plotting out small steps to help us reach our goal. It wasn't an easy task, and I've broken it down into four articles that I hope will help you plan for your own adventure.
The first, and perhaps most important, installment of the series? Saving.
The vision of our year abroad was cultivated on our honeymoon in Italy.
I never thought that I would save enough money and frequent flier miles to bring my wife on her first trip out of the southern United States, much less overseas to Italy. But I managed to do it.
When we got back, she dreamt about how we could go back to live there.
Like many families, however, we had jobs and a home to care for that made it difficult to leave, so the time wasn't right. But nevertheless, a seed was planted.
Most people who travel for long periods of time aren't on endless vacation; they have simply adopted a new and different lifestyle, which typically includes some form of work on the road. So, early after making the decision to go, it was time to start saving money.
Here are my top five ways to get financially prepared for your trip.
1. Don't Give In to Hype
As you begin planning, you might be tempted by fancy travel gadgets and accessories advertised in books and blogs. Resist temptation. Things like luggage or backpacks, electric converters and adapters, durable and flexible travel clothing can all bloat a pre-departure budget, so be mindful of your needs and shop wisely.
2. Stay In Now for Great Nights Out Later
Saving means delaying gratification. Ask yourself, would you rather have a nice dinner and drinks out in your hometown, or have them while on your trip? Try to think of ways you can trim the fat in your budget without making yourself miserable. For us, that meant brown bagging lunch and forgoing dinners out to eat at home. That saved us around $100 per week. Know yourself and act accordingly.
If you like eating out of the office at lunch, try packing a lunch and going to a local park or public area to eat it. You will still be able to get out of the office, but you will save on the cost of the meal out. Naturally, you will want to eat a nice meal out every now and then, so when we did go out, we nixed the appetizers and desserts, which also helped our waistline.
We split meals often due to enormous American portion sizes. We also saved by getting water instead of sodas or alcohol. The markup on these items is incredible, so avoiding them saved a bundle. Who cares if your server thinks you're cheap; you'll have the last laugh when you're sipping a fine Argentine wine dining alfresco in Buenos Aires.
Cut out the car by using public transportation, walking or biking. Not only will you save some cash, you'll be well on your way to living like a local in many countries abroad where cars are a luxury, not a necessity.
4. Increase Your Income
Pick up a second job to earn more money. From dog walking and tutoring to babysitting and bagging groceries, there are plenty of ways to increase your cash flow even if you're bound by a 9 to 5 job. My wife and I both had second jobs, which came in handy to save extra funds.
You could even move into a cheaper place or add a roommate for a year in preparation for your trip. We saved some money by finding someone to sublease our apartment for a couple of months and we moved in with family.
Sure, this isn't for everyone, but for me it was a great prelude to months of extended travel. If you live far away from home and don't get to visit frequently, this can be the perfect time to get up close and personal with the ones you love before you leave.
5. Sell Your Worldly Possessions So You Can See the World
We tend to accumulate more stuff than we use on a regular basis and selling it can lighten the load and build up savings. Some people sell everything they have to prepare for extended travel, and that can definitely turn your junk into the cash to finance your travel.
Selling things like a house or car can obviously bring in lots of money. We didn't choose to sell any big-ticket items, but even selling furniture or clothes is a good exercise to keep from hoarding and can save on storage costs.
Investing Answer: Saving money is an essential aspect of planning for long-term travel. The more money you set aside for a trip, the longer you can travel. The deferred gratification can pay off later.
- Create a retirement savings goal
- Design an investment plan to reach it.
- Get a professional money manager to continually monitor and rebalance your portfolio
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