Family Vacation Budgeting 101
Expert Tips and Tricks to Budget Like a Pro
Planning a family vacation can be an exciting experience, filled with anticipation for all the fun and memories that lie ahead. However, it’s crucial to approach vacation planning with a well-thought-out budget to avoid overspending and potential financial stress, so lets talk about family vacation budgeting!
When you begin looking for family vacation budgeting tips, you will inevitably hear that you should be opening up multiple credit cards to take advantage of introductory interest rates, bonus points, travel points, airline miles, etc. As a matter of fact, I know people who do this and who are successful with it, but it takes a lot of discipline for this to work.
The truth is though that most people fail with this! One small slip up can lead you into a world of financial pain. Who cares if you didn’t pay a dime on airfare for your last trip if you are saddled with years of credit card debt and interest. Opening up 10-20 credit cards isn’t a family vacation budgeting tip or hack. It is a trap!
In this guide, we provide expert tips and tricks to help you budget like a pro, ensuring your family vacation is both enjoyable and cost-effective.
What to Consider for Family Vacation Budgeting
Accommodations
Accommodations are often the largest portion of your family vacation budget. When choosing the right lodging, you need to weigh the pros and cons of different options. Vacation rentals offer the advantage of full kitchens, allowing you to prepare meals for your family and save money. On the other hand, hotels may provide additional amenities like pools, fitness centers, and concierge services, but at a higher cost. Consider your family’s needs and preferences to make an informed decision. We have several blog posts on how to pick the right lodging and how to save money when choosing. Make sure to check them out before starting your family vacation budgeting process.
Hotels vs. Vacation Rentals
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Book Amazing Vacation Rentals (Part 2)
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Transportation
Transportation expenses can quickly add up, especially if you’re flying to your destination, and can quickly wreck your family vacation budget. Instead of relying on travel reward credit cards, use online tools to find the best flight deals. Booking well in advance of your trip (6-12 months) can also result in significant savings. Another option is to plan your travel around the cheapest flights. When you fly, you also need to consider the cost of rental cars or other ground transportation once you are at your destination.
If you’re road tripping, it is a bit simpler. Calculate the amount of gas needed for your trip (total miles divided by your vehicle’s gas mileage) and add a contingency factor to your estimate (I suggest 25%) to account for changes in gas prices or longer than expected side trips.
Activities and Attractions
While planning your trip, research the costs of various activities and attractions your family will enjoy. Then, categorize these activities as expensive, average, or cheap, and set an allowance for each category in your budget (for example 2 expensive activities, 5 average activities, and 10 cheap activities). This is an overly simplified method, but it is surprisingly helpful for family vacation budgeting. This way, you’ll have an estimate of how much you’ll be spending on leisure activities, preventing overspending on entertainment during your vacation.
Meals & Dining
Just like at home, preparing your meals and packing snacks while on vacation can save a significant amount of money. However, this option requires accommodations with suitable kitchen facilities. If you are planning on staying at a hotel without a kitchen or kitchenette, you can still save money by packing your own snacks and basic meals (like sandwiches) and taking advantage of free hotel breakfasts.
Research dining establishments in the area to estimate how many meals you’ll need to budget for. Be prepared for occasional restaurant visits, but don’t forget to account for the savings from preparing your own meals. Many vacation rental hosts offer some type of grocery delivery service, so you can easily have groceries dropped off, stocked, and ready to go before you even arrive, saving you the time of going to the grocery store. You’ll also be in control of the virtual shopping cart, which will be a big boost to your family vacation budget.
Travel Insurance
Though it might seem like an additional expense, travel insurance can be a lifesaver in emergencies. Check with your insurance company to see if they offer travel insurance and compare premiums from various travel insurance companies to find the best coverage for your family.
Souvenirs
To control souvenir expenses, make sure you are factoring them into your family vacation budgeting sessions. We like to give each family member an individual allowance for the trip, and souvenirs come out of this allowance. This approach not only sets spending limits but also prevents your home from accumulating unnecessary junk…I mean souvenirs. I’m not a big fan of souvenirs, and I would rather focus on creating memories and experiences, rather than material possessions. No judgment here though. If you or your kids love souvenirs, buy them! Just make sure they are part of your budget and don’t let them become unexpected vacation budget busters!
Contingency Funds
I don’t know why, but this is something I rarely see anyone recommending. Think of a contingency fund like the emergency fund for your family vacation. Even with a well-planned budget, unexpected expenses can arise. Allocate a contingency fund, ideally 25-30% of your total budget, to cover unforeseen costs. To avoid using this money for impulsive purchases, keep it in a separate bank account without easy access. This way, you’ll only use it for genuine emergencies rather than extra money to spend on whatever you want.
We like to take our unused vacation contingency funds as a starter fund for our next family vacation budget!
Tips & Tricks
While we do have a lot of experience in family vacation budgeting, we are not a limitless resource, so we turned to one. Here are some of our favorite additional tips and tricks from the family vacation Facebook groups that we are a part of.
- Utilize apps like Qapital and Acorn to save money incrementally without noticing it. These tools allow you to round up your daily purchases to the nearest dollar and direct it into a separate savings account. While these were designed to help people get started with investing, they are great family vacation budgeting tools!
- Set up a dedicated travel account with direct deposits from each paycheck.
- Time your vacation around airfare prices and seasonality to save on travel and accommodation costs.
- Save gift cards, bonuses, or extra paychecks throughout the year to use for your vacation.
- Book accommodations well in advance to secure lower rates.
- Join loyalty programs offered by hotels or booking platforms for added benefits.
- Consider High Yield Savings Accounts or CDs for guaranteed returns, especially in today’s high-interest rate environment.
- Purchase activity-specific gear in advance through platforms like Amazon to avoid expensive rentals.
How to Successfully Build a Family Vacation Budget
Start with a separate savings account or fund for your family vacations. We like to open these with banks that are separate from our personal accounts. We also don’t get any debit or ATM cards for the accounts making it more difficult to access these funds for anything but their intended purposes.
Once the account is set-up, decide how you are going to fund it. Use the tools outlined above like Qapital and Acorn to automatically divert ‘extra change’ into the accounts. Most banks allow you to set up automatic transfers too, so you can easily add money every paycheck into your vacation fund.
As for the actual process of family vacation budgeting, to each his own. I’m a fan of setting up my own, admittedly overcomplicated, spreadsheets, but a simple sheet of lined paper with a few estimates is more than adequate. As long as you have a starting point to build from, you are budgeting!
Family vacation budgeting is essential for a stress-free and enjoyable vacation. By carefully considering accommodations, transportation, activities, meals, and potential unexpected expenses, you can create a well-planned budget that allows your family to have a fantastic vacation without breaking the bank. By following the expert tips and tricks provided, you’ll be well on your way to becoming a budgeting pro for your future family adventures.
We’re doubling up on blog posts this week, so keep an eye out for our next post highlighting Branson, MO!
If you haven’t already, make sure to follow us on Instagram @sugarbearvactions and on Facebook.
Until then, happy travels!
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