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Travel Savings Fund

Why I Finally Set Up a Travel Savings Fund

July 25, 2018

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Travel has been on my radar more than ever after I quit my job, went to FinCon15, and decided on some places I wanted to travel this year.

First, it’s just so much easier to travel now that I’m self employed. I don’t have to request time off, make sure I have enough vacation time saved up, etc.

The only downside I’ve found while trying to travel now is that I have to work like a crazy person beforehand to get ahead. And I can’t go anywhere without my computer.

I tried it once for a weekend trip and I felt like I had left behind my left arm. (Yes, left arm since I am left-handed.)

But the point is, now that I have travel on my mind more often, I finally decided to set up a travel savings fund earlier this year.

Why I Finally Set Up a Travel Savings Fund

Back in April, two of my girlfriends and I took a long-weekend and went to Colorado for some hiking and R&R. It was fun to get away from real life for a few days and enjoy time with friends.

One night while we were up laughing and talking instead of sleeping, we decided we are going to go on at least one “girls trip” each year. We talked about several places we want to go in coming years and then decided on New York for 2017.

I’ve been to NYC a couple of times, but neither of them have. I know NYC in particular can be expensive, so I didn’t want to have to cashflow the whole trip in one month like I did when we went to Colorado on an almost spur-of-the-moment trip.

The moment I got back home after our trip to Colorado, I set up a new travel savings fund and nicknamed it “New York”.

Update: These days, I just call it “Travel Fund” since I don’t always know where I’ll be going next. 🙂

How I’ll Use My Travel Savings Fund

I started funding my travel savings fund in June 2016 with $100/month. By the time we go to NYC in the spring, I should have almost $1,200 in that account. (Other than early withdrawals I’ll have to make for flights.)

My friends and I started pricing flights, hotels/Airbnbs, and the activities we want to do during our trip. We are planning to keep it pretty frugal. But, I know I’m going to spend on all.the.food while I’m there because hello?! it’s NYC! Plus, we all know that I love to eat out.

Whatever money I have left in my travel savings fund after paying for that trip will stay in that fund for my next adventure.

Why You Should Set Up Your Own Travel Savings Fund

I recommend setting up your own travel savings fund with a different bank than where you keep your regular one. There are a couple of reasons why.

1. Less Spending Temptation

I don’t know about you, but when I have extra money around I can always find a way to spend it, even if I had it ear-marked for some long-term goal.

Thus, it’s just easier to avoid spending temptation by having it in a separate account or separate bank so I don’t see how much I’ve socked away.

Opening a new account for your savings challenge will also help you keep your money organized. Remember, out of sight out of mind. So, you won’t be as tempted to dip into your savings account for something other than its intended use.

2. You Can Earn More Interest

If you keep money in a brick-and-mortar bank, chances are that you’re earning little to no interest on your money. Since saving for travel is a goal that will take several months (or more), it’s smart to keep your money in an account that can earn you interest.

Here are two I recommend.

Synchrony Savings

Synchrony Savings has a rate of 2.05% with no minimum balance or monthly service fee. With a Synchrony Savings account, you can also transfer, deposit, or withdraw funds with their easy to use mobile app.

Barclays

Barclays has a rate of 2.05% with no minimum balance. It can also be linked directly with any existing bank account to make things easy for you!

Summary

At this time, I don’t plan to use my travel savings fund for any business travel. I already save for that as part of my business savings each month already.

I’m so glad I finally took the first step at prioritizing travel by setting up a travel savings fund for my future trips. I know it will be a lot easier to make them happen when I have the money ready and waiting. Plus I won’t have to deal with any guilt over spending that money on something fun!

Do you have a travel savings fund?

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12 responses to “Why I Finally Set Up a Travel Savings Fund

  1. I’ve done the same thing a few months ago. I have not been on a vacation in 10 years. I am overdue. Next year, I am planning a vacation. Alone.

    I love CapitalOne360 for my sinking funds and now for my travel fund.

    Have lots of fun! I have to make it to the Big Apple soon.

  2. Congrats on setting up a travel fund. I don’t have a travel fund per say but I do mentally set aside a portion of my budget towards a vacation each year. My wife and I have been able to take some amazing trips by budgeting. Good luck in your travel in the future 🙂

    1. I tried setting money aside in my head, but it was too hard for me to keep track of my savings goals that way, so I finally had to set up a couple of separate savings funds for things like travel and expenses that don’t occur monthly.

  3. It’s funny how when you leave your day job you know you’ll have the freedom to travel and when everything sets in you realize there are some changes you have to make even to a self employed schedule just to take a trip. It is great that you decided to set up a separate savings fund apart from your other money. It definitely puts things into prospective.

  4. This is what I haven’t done, and I will have a travel fund soon so that I prioritize savings and travel more often. And, I think it makes savings a bit easier because I get to manage everything using different allocation or funds.

  5. My husband and I set up a travel fund with Barclay online bank and funded our family trip to Myrtle Beach back in May! We don’t make a lot of money since I work part time and he’s disabled but we managed to set aside a little each month, and researched flights and hotels and inexpensive activities happening that week. We even found a groupon for miniature golf! We had an amazing time and plan to make this a yearly thing.

    1. That’s great! I think many people who don’t take vacations could, they just don’t always choose to. It’s all about making a vacation a priority, as you have, and making different choices to accomplish that goal.

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