Make your dream trip a reality by being travel savvy and planning ahead.
There's nothing like just having had a holiday to make you start thinking about your next one. And while the thought of saving for anything might seem daunting after the financial squeeze caused by the Covid-19 pandemic, it’s also true that it’s never too soon to start.
Whatever kind of holiday you’re keen on – whether it’s an island getaway or a local-is-lekker trip exploring SA – here are budgeting and cost-saving tips to help you make it a reality post-lockdown.
Think of it as ‘future spending’
Our mindset around saving is important, says psychologist and financial planner Brad Klontz, who suggests looking at it as “future spending” as opposed to saving or depriving yourself of something.
“I think the entire concept of budgeting is flawed,” Klontz says. “Your emotional brain responds to the word ‘budget’ the same way it responds to the word ‘diet’. The connotation is deprivation, suffering, agony, depression.”
Plan your trip
Think about where you want to go, what sort of accommodation you’d prefer and what you want to do while you’re there. It’s not vital to plan every last detail but do some research on what travel, accommodation, food and activities will cost.
Once you’ve planned a vague itinerary, look at the total estimated cost and your intended date of departure. Divide the amount by the number of weeks until you’d like to leave and you’ll know how much you need to set aside weekly to be able to afford your trip.
The best savings option
You want your money to be earning interest in a secure account, but you also want it to be readily available if you find a great deal on cheap plane tickets. When you’re saving for a short period of time – such as for a holiday at the end of the year – your best option is a money market account, says Braam Fouche, a financial adviser with PSG Konsult’s Umhlanga Rocks branch in KwaZulu-Natal.
“Your capital isn’t exposed to stock market volatility, it remains readily accessible, usually within 24 hours, and the interest rate compares well with longer fixed-term interest rates,” he says. “Money market interest rates currently fluctuate between 6 and 7% a year.”
Saving on airfare
If you’re thinking of an overseas holiday, airfare can easily be your largest expense. Here’s how to save on air travel. S Book early While you need time to save, booking as early as possible is one of the best ways to ensure you get a good price. Airfares usually jump in price during the last three weeks before departure, so book at least a month in advance.
- Be flexible Flying mid-week or on actual holidays such as Christmas Day is usually cheaper. You could also consider flying to a different, smaller airport.
- Compare rates Before booking directly with an airline, compare prices on a third-party booking site. Three of the best are Momondo, Google Flights and Priceline.
Don't forget to travel insurance
One of the biggest perks of paying for flights with your credit card is the complimentary travel insurance that comes with it. All major South African banks offer this perk when you purchase an air ticket or cruise departing from and returning to South Africa.
If you pay for anything with your credit card, you need to either put the cash back into your credit card account immediately or be committed to a strict repayment plan, says finance journalist Maya Fisher-French. “You should have a repayment budget plan to pay it off over two or three months max.”