So you want to travel the world? The first thing you need to get real about is finances- I can feel you cringe! Let’s face it no one wants to worry about the $, you just want to magically be able to afford amazeballs trips forever- me too! Unfortunately this probably isn’t going to magically happen but with a little bit of forward planning your goals can easily become a reality.
When we first decided we wanted to quit our jobs and take off on a 12 month adventure, we worked out how much we had to save subtracted that from our sad savings account and got scared. Our initial reactions included ‘OMG’ and ‘no way can we do this’. After the initial shock wore off we changed our mindset and started asking each other ‘how CAN we do this?’.
We’re now about 3 months pre-departure and we’re pretty on track with our savings goal. It hasn’t been easy but we’ve done it and to help you out we’ve pulled together a few tips which helped us boost our savings in preparation for our trip. The earlier you can implement these money savings tips the quicker you will see your bank balance increase and ultimately get you to your dream trip!
Tip 1 – Sweat the small stuff
Find your nearest dollar store and invest a couple of dollars in a money tin- you know the kind you can’t open unless you hack at it with a knife. At the end of each day empty your wallet and put your spare change in – it’s that simple! You’d be surprised at how much this little habit will add up -we filled a medium money tin in about 6 months and had roughly $1,000 saved which went straight towards our trip.
Tip 2 – Budgeting
Boring we know but if you want to get serious about saving money it is important to do a budget. The easiest way to work it out is match everything up with your income. You need to be honest with yourself and record all of your current outgoing such as bills, food, rent, fuel, entertainment, loan repayments and so on. If you get paid fortnightly or monthly then calculate your current outgoings on the same basis. The difference between your take home pay and your outgoings is what you should be able to save. The key to sticking to a budget is transferring your savings on pay day and only spending what is left over. You’ll fail a few times and that’s ok, it will take a while to get into the habit but once you do sit back and watch your savings grow.
Tip 3 – Cut back on eating out
We sacrificed coffee and this instantly saved us $50 per week. Now I know this doesn’t seem like much but if you start doing the sums $50 a week is on average $200 a month and that adds up to $2600 a year. Imagine what an extra $2600 in your trip kitty could get you? For us that basically covers an extra month or so in Asia. We also started taking lunch to work everyday and cut back on eating out and take away. I parked 10 mins away from work where I could park for free instead of paying for parking. These small things can add up to big figures so check your habits and see what you can sacrifice.
Tip 4 – Save on bills
After you have finished your budget have a look at your current bills and see where you can save some money. Review your insurance, phone, internet and electricity providers – basically anyone who sends you a bill. Call to see if you can get a better deal and if not shop around. We managed to get better deals on insurances just by asking for one- it pays to ask!
Tip 5 – Reduce and consolidate your debts
If you are planning to quit your job and travel the world you will travel longer if you leave minimal personal debt behind. Work on getting that car loan or credit card paid off before your trip. Look to refinance or consolidate debts onto a cheaper interest rate to help pay them off sooner. If you have a mortgage contact your bank to make sure you are on the best deal. Consider switching your home loan repayments to interest only to redirect the difference to your savings or towards paying off smaller personal debt.
Tip 6 – Sell unused items
Now is a good time to sell any unwanted items you have accumulated over the years. When was the last time you used those golf clubs. Do you have a large DVD collection you no longer need. If you only have a few items to sell you could easily list them on eBay. If you have a lot of items to sell then you could consider a garage sale. We have two cars and have decided to sell one of them to boost our savings. The other car we will leave with family to use so we do not incur any running costs while we are away.