Not everyone is blessed with millions of miles and points that allows travel to be free. And plenty of people are not in a position to get new credit cards to pay for your flights and hotels. Many of us have to scrimp and save to afford to travel to visit family or the next vacation. But family and vacations are so important to reducing stress and creating memories that last a lifetime.
Why Americans Don’t Travel
Stress due to increased responsibilities at work in the aftermath of the financial crisis is a major reason why people aren’t vacationing. However, that is also a reason why people NEED to take a vacation. You’re no good to your employer or your family if you’re too stressed out to function normally.
In fact, a study has calculated that Americans left 658 million vacation days unused in 2015. That is more than half of the vacation days given by their employers!
You CAN Afford to Travel
Work requirements may be one cause of unused vacation, but I believe that the underlying reason is that people think that they cannot afford to travel. The combination of travel expenses and the potential lost income is enough to make people just say “forget it” and not travel.
Here are 5 easy steps to find the money to travel.
1. Refinance Your Debt
Debt is a bitch. And it’s a demanding boss that is unrelenting. I’m fortunate to have paid off my student loans and my auto loan the last couple of years. Now I’m working to pay off my home and rental properties mortgages to be completely debt free.
One of the tactics that has helped me accelerate the payoff of my debt is refinancing. Lowering the interest rate that you pay on your loans allows you to free up money to pay more of the balance or to pay for other bills. I refinanced my student loans to save over 50% on my interest rate. I used SoFi to refinance my student loans, and it was such a simple process… all done online! They offer great rates and will give you an extra $100 if you use my referral link.
I also refinanced my home to eliminate the FHA premiums that were eating up over $400 a month!!! SoFi offers mortgages as well, but I wanted a 30-year fixed rate loan, so I went with someone else. Even though I refinanced into another 30-year mortgage, I’m still paying as if it is a 25-year loan so that it will be paid off within 30-years of when we bought it.
2. Use Apps to Save on Every Day Expenses
Most of you have heard of apps that will earn you miles on your spending. You can use an app like the United MileagePlusX app, which gives you up to 5% on your spend. And you can register for the dining rewards program of your favorite hotel or airline. But did you know that other apps help you save or provide cash back on your purchases?
One of my favorite apps is ibotta. I’ve only been using ibotta for a little while, and I’ve already saved over $200 with it. The ibotta app provides a way to get extra money back when buying specific items at grocery stores and online. All you need to do is scan the barcodes of specific items and take a photo of your receipt. Voila! A few days later, you’ll get paid to your PayPal account. Use my ibotta referral link and you’ll get $10 when you redeem your first rebate.
Another great example is the Benefit app. This app works similar to the United MileagePlusX app, except you’ll get cash back for your purchases instead of miles. Not every store in UMPX or Benefit, so check both whenever you are out shopping to see if you can save some cash.
3. Use New Tech Instead of Old Tech
One of the ways that many people are saving money today is by “cutting the cord.” This means that people are eliminating cable and their phone service to use online services like Hulu and Netflix for TV and their cell phone in place of a landline.
Eliminate Cable for Online Streaming
According to a recent study by Forbes, the average cable bill is now $103 per month. Whereas, if you had a subscription to both Hulu and Netflix, you’d pay $7.99 for Hulu and another $7.99 for Netflix. That $16 combined bill will save you over $1,000 per year!
Amazon Prime is also roughly $8 a month for unlimited movie streaming (and so much more, including online storage, music streaming, and free 2-day shipping). Click here for a free 30-day trial of Amazon Prime.
If you like to watch sports like I do, there are several options available to stream ESPN as well. The best option for streaming ESPN is Sling TV, and T-Mobile customers get 30% off Sling TV for one year.
Say Goodbye to Your Landline
With landline phones costing an average of $20 per month, I don’t know too many people that still use one today. We do, but that’s because we eliminated the monthly bill with Ooma. We bought an Ooma VOIP phone about 8 years ago for around $100 and haven’t spent another dime on our landline since. I only call the phone when Anna doesn’t answer her cell because it’s on silent mode. Other than that, only telemarketers and Doctor’s office reminder calls happen on this phone.
Aside from canceling your landline phone bill, consider being a free agent when it comes to your cell phone. There is a lot of competition among T-Mobile, AT&T, and Verizon, so you can probably find some savings if you haven’t updated your plan recently. Click here for the latest offers from T-Mobile, AT&T, and Verizon.
And there are some discount cell phone providers to consider as well. FreedomPop offers a 100% Free mobile phone option. Republic Wireless offers plans starting as low as $5 a month. With the average cell phone bill $73 per month, according to a J.D. Power 2014 study, you could save some serious money with Republic Wireless and FreedomPop!
4. Save Small Amounts Towards Your Goal
Once you’ve determined a reasonable budget for your next vacation, you can save towards this goal with a variety of apps. The one that I use most is Acorns. Acorns rounds up your purchases from registered credit and debit cards, then invests the total in the stock market for you. Deductions are made from your linked checking account whenever they add up to $5 or more. I’ve saved over $900 since I started using Acorns.
Start investing with Acorns today! Get $10 when you use my invite code.
I also register all of my cards with programs like UPromise. Over the years, I have saved almost $800 with UPromise!!! UPromise is a program initially designed to help people save towards college and to pay off student loans. Recently, the savings can now be transferred to a savings account that can ultimately be used for anything, including building your emergency fund or paying for your next vacation.
Even the big banks are offering tools like this. Bank of America has offered their “Keep The Change” program for a few years. Whenever you use your debit card, it rounds up the purchase to the nearest dollar, then saves the money in a savings account. BofA pays next to nothing on their savings accounts, so use an account like CapitalOne 360.
5. Eliminate Fees
Fees are everywhere. And I hate paying them!
People pay way too much in late fees to banks and credit card companies. Simply automating your account to pay at least the minimum each month will save you the $39 (or more) that banks charge if your payment is late. Read here for some more easy ways to automate your finances.
Banks also like to charge you monthly fees just for having an account. Plenty of banks and credit unions offer accounts that are completely free or are free with a small direct deposit. Research your local banks and find one that caters to someone that fits your financial profile.
When you travel, airlines LOVE to charge you fees. One of the worst is checked bag fees. If you have the co-branded credit card for the airline you’re flying on, you can often get one checked bags for free for each passenger. Better yet, choose an airline like Southwest that doesn’t charge ticky-tack fees. The more you avoid businesses that hit you with fees, the more they’ll need to change their business model!
The Bald Thoughts
Saving for your next vacation doesn’t have to be an impossible task. There are some easy steps you can take so you can afford to travel. We discussed five ways to reduce your expenses – refinance debt, use apps, technology, small savings, and eliminating fees. Using these strategies will allow you to reach your savings goals faster than ever. Best of all, these strategies are easy to implement and can be done quickly.