Machu Picchu. Iceland. Bali. It seems like everyone on your Instagram feed is now a world traveler. It’s enough to self-diagnose a serious case of FOMO (fear of missing out).
But before you lament your lack of perfect infinity pool photos, take a good, hard look at your finances and figure out how to make your travel dreams a reality.
Research shows that people who spend money on experiences rather than material items are happier, meaning that travel and other bucket-list experiences are a satisfying way to spend. However, 45 percent of millennials say that financial stress has increased in the past 12 months (according to PwC’s Employee Financial Wellness Survey), so spending two months’ rent on a holiday seems somewhat unjustifiable.
It’s important to remember that many of these once-in-a-lifetime trips are just that: once in a lifetime. After having kids or career-related commitments, it isn’t as easy to embark on a spur-of-the-moment road trip around New Zealand or spend days lounging on Zanzibar’s white-sand beaches. Plus, jet-setting can pay off once you return to the daily grind. “Statistically, taking more vacation results in greater success at work as well as lower stress and more happiness at work and home,” the Harvard Business Review reports. “Just make sure you plan the trip at least a month in advance, as one of the key predictors of vacation ROI is the amount of stress caused by not planning ahead.”
Check out three ways that you can make your finances work harder for you, so you can afford to splurge on your travel plans.
1. Credit cards
Using credit is a common and reliable way to pay for those much-needed experiences, as long as you remember to pay off the balance to avoid those pesky high interest rates. Many credit cards earn cashback, which can help pay for flights and hotels, a new camera to take Instagram-worthy travel photos or paying off your monthly balance—plus there are some with no foreign transaction fees. Once you’re on location, live the cashless lifestyle—countries from Singapore to Sweden are moving increasingly toward electronic payments, which not only means you can quickly rack up rewards each time you purchase a souvenir, but you’ll avoid awkwardly fumbling with foreign coins.
2. Make your travel funds work for you
Nothing feels better than making money without lifting a finger. Opening a high-interest savings account is a great way to collect compound interest and make your money work for you. Top it up whenever you can and you’ll meet your travel fund goal in no time. Also, keep timing in mind: Travel sites often offer great deals, when supply exceeds demand, for those who can book a getaway on short notice. Sign up for newsletters from your favorite hotel brand or tour company, and get ready to pack up and fly off.
3. Side hustle and save
More than one-third of millennials (more than other demographics, according to a CareerBuilder survey) have side hustles to earn extra money, from teaching yoga to freelance web design and blogging. Put a portion of that hard-hustled cash directly into your travel fund. Better yet, invest those dollars into that high-interest savings account we discussed above, and see the compound interest at work.
No need to live in envy of your globetrotting friends. Using the above tips, make your own travel plans. Write a bucket list of everything you want to see and everywhere you want to go, figure out a way to get there and trust us, you will.