When we picture our retirement, we often dream about finally getting to do all of the things we weren’t able to when we were working a 9-5.
Long, leisurely trips around the world, soaking up adventures and experiences, relishing in our hard work paying off.
Unfortunately, saving for retirement doesn’t always include the necessary budgeting for those dream vacations.
Before you let your dreams go up in smoke, though, let me help you with a few simple and easy tips to budget for vacationing during retirement.
Making sure you have room in your retirement budget for vacations isn’t too tricky—you just need to keep the costs in mind and make sure you’re prioritizing.
Determine How Much Money You Can Spend on Travel Per Year
While this may seem like an obvious step, many individuals don’t know how to calculate it, or forget to include trip expenses in their budgeting.
In general, you’re able to withdraw around 4% of your nest egg each year without having to worry about running out of money during your retirement.
Of that 4%, subtract your living and day-to-day expenses, including taxes. The money you have leftover is what you can budget for travel.
Prioritize Your Trips
Make a list of all the trips you want to take in a year.
Then, prioritize the trips in order of what you most want to do, and which are most important to you.
That way, if unexpected expenses pop up and you don’t have enough funds to finish your list of trips, you’ll still have gotten to the ones most important to you.
Also keep in mind that you’ll probably want to do more physically demanding trips earlier in your retirement rather than later, to ensure you’re able to do them and enjoy them.
Again, this may seem like obvious advice, but the earlier you start planning, the more variety you’ll find in pricing, and the easier it’ll be to stick to your budget.
If you’re planning a trip way ahead of time, and especially if you have some flexibility on your dates, you can save a lot of money by choosing flights and accommodations that are cheaper.
Additionally, if you’re able to go on trips last minute, many airlines and hotels offer extremely discounted prices for dates that are coming up and haven’t been booked yet.
Stay Longer for Big Trips + Combine Multiple Stops
For many destinations, especially those in Europe, the flights are the most expensive part of the trip.
Make the most of that money by staying as long as you can.
You can also hit multiple countries in one trip very easily in places like Europe, and make the most out of your flights, as well as knocking more places off your bucket list.
Include a Buffer
Make sure to include a buffer in each trip’s budget to cover any unknown or unexpected costs that come up. Also look for any senior discounts you can take advantage of to save you some money.
You’ve been working and saving up your entire life.
You want your retirement to be everything you deserve and have worked for all those decades.
Don’t let those dreams disappear because you don’t know to budget for those experiences.
I’m here to make it as easy as can be, and make sure you get the most retirement bang for your buck!