“If traveling was free, you will never see me again” – is it your favorite line?
If your answer is ‘Yes’ with a big smile on your face, then this article is a must-read for you. Traveling the world is a dream many of us nurture but only a lucky few get the chance to realize it.
The first and biggest hurdle in making this dream come true is – MONEY. Days are getting more and more expensive, and we all have several financial responsibilities to shoulder - bills to pay, and a lifestyle to maintain. Yet, if you are a true traveler at heart, this dream will never fade.
What if we tell you that you can realize your dream of traveling the world just by being wise? Proper financial planning and budgeting is the key to more savings. Check out this guide to know how to get your financial life in order so that you can save more money to travel the world.
1. Become financially responsible
Planning is vital to get your finances right. Irrespective of how much you earn, without proper planning, saving enough money to travel the world can be difficult. So, take full responsibility for your finances and plan ahead keeping your goal in mind.
Saving money is a long-term process and there is no quick fix for it. The early you start, the easier it will be to achieve your dream. Depending on your income and essential expenses, set an achievable time limit to save enough money.
Do not plan to save a huge amount in minimum time. It will invariably lead to super-strict budgeting and push you to end it abruptly. Follow a plan that will help you to save money slowly but steadily over a period of time.
The best thing about planning is that it gives you a well-laid path to reach your goal. It will also help you to decide if you need extra earnings, through a part-time job or freelancing, to meet the plan. Once you have a plan, start following it immediately. Do not push it to the next month or even for the next week.
Check frequently to ensure that you are saving the required amount every week. Creating a separate bank account for your travel fund is a good idea. It will ensure that you do not use the money for other purposes.
2. Track your expenses
Do you spend like a king during the first week of the month and by the month-end you start cutting down even necessary expenses? Well, you are not alone, but if you are planning to save money to travel the world, you need to change this habit as quickly as possible.
When it comes to saving money, how you spend is more important than how much you earn. Many of us have no clue where our salary goes by the time the month ends. Tracking your monthly expenses is a must to find out where you are spending your hard-earned money.
Often, we end up spending excessively on things that are not necessary. You will hardly notice these unnecessary expenses until you start tracking. Once you have a clear idea about how you are spending all your money, you can cut off the non-essential expenses to save more.
It will also help you to understand your spending habits and how you can moderate them for more savings. Tracking all your expenses is the only way to find out that you are using your money and not wasting it. An expense tracking app will help you to do this task quickly and efficiently.
3. Budget your life
Budgeting your financial expenses can be extremely helpful to save more for your trip. Once you have tracked all your expenses, budgeting becomes easy. The basic objective of budgeting is to stop over-spending, it does not mean you cannot spend as per your need.
Proper financial budgeting helps you to allot a particular amount of money for a specific purpose. This ensures that you have enough money for all your financial responsibilities and some for savings too.
When you have a pre-determined amount to spend for a specific purpose, your expenses will naturally become more thoughtful. You will start spending money more wisely.
For example, many of us spend a hefty sum every month on luxury toiletries. You can easily use a combination of luxury and mid-range toiletries to save considerably without losing on the experience. You can even buy luxury cosmetics during special offers to save more.
Once you have fixed a budget for a specific purpose, you will start looking for better offers that will give more value for your money.
Also, we often buy things that we don’t need. Most of these items end up in the closet and hardly ever see the light of the day. Budgeting will help you to stop these unnecessary purchases and spend only on things that are important.
4. Develop habits that save money
Simple lifestyle changes can be extremely helpful to save money. Many of these changes are healthy not only for your wallet but also for the environment. If you are wondering what are the habits that can help you save money quickly, here’s a list,
- Buy only what you need
This is the most important habit you need to develop to save money for your world trip. When it comes to buying things that we don’t need, each one of us is guilty to some extent.
Be it just some extra snacks, an interesting household item, or a hair gel from a new brand, do not spend it on things that you don’t need. Most of these things will anyway end up in your closet or stock after just a few uses. Develop a habit of abstaining from buying things on a whim.
- Start cooking more at home
Restaurants are expensive and eating out can quickly drain your budget. With the multiple food delivery apps on your smartphone, ordering from your favorite food joint sitting right at home is no doubt tempting. The problem is: It easily adds up to your food expenses. Cooking at home is much more pocket-friendly and healthy too.
Learn new dishes that you would like to eat and instead of ordering frequently from restaurants or eating out enjoy tasty and healthy home-cooked cuisines. To cook at home, you need not be a kitchen whiz. There are several online resources to help you learn. Give it a try and cooking might become your favorite hobby.
- Use public transport or share
Using public transport can help you to save more money. With the increasing gas prices, using your personal vehicle for daily commuting can be expensive. Sharing the ride with a friend or neighbor when feasible is also a great idea. It will even help to reduce environmental pollution and save you the vehicle repair costs to some extent. Use private transport only when it is necessary.
- Save on electricity bills
We often overlook wastage of electricity at home and end up paying more on electricity bills. It might look like a small monthly expense, but the total money paid in a year is substantial. You can easily cut down on energy bills by replacing traditional bulbs with LEDs.
Make sure that all your household appliances are in proper condition, and they are not consuming more electricity. Also, make it a habit to switch off the lights and every other electrical equipment when they are not in use. Give the air conditioning or heating system a break when the outside weather is comfortable.
- Spend less on clothing and accessories
Take a thorough look at your monthly expenses and you will know how much money you spend on clothing and accessories that you do not even use often. Develop a habit of not spending on clothes or accessories just because they look good. Buy only when you need.
When you are trying to save money, instead of spending on garments or accessories from luxury brands, opt for good quality items from lesser-known or new manufacturers. Purchase a dress or a running shoe only when you need it, not because you might need it in the future. Don’t be tempted by offers and sales and spend unnecessarily on shopping.
- Skip watching movies in multiplexes
Going out to catch a movie in the multiplex is a great weekend plan but also an easy way to spend a lot of money. Movies in multiplexes are often ridiculously expensive and if you love snacking while watching movies, you will end up paying double or more for the food.
There are multiple OTT streaming media services like Prime, Netflix, Disney+ that offer budget-friendly plans for the best entertainment. Subscribe to one of these and enjoy your favorite shows sitting right on your favorite couch.
- Discontinue automatic payments
Auto-debit for recurring payments makes managing your monthly bills easier. However, it adds to the chance that you might be paying for a service that you are not using anymore. If you have activated automatic payment for multiple services (apps, mobile bill, internet bill, credit card bill, etc.), it can be really difficult to keep proper track.
Multiple auto-debits can quickly drain your account and are not a good option if you are planning to save for traveling the world. If you are prone to miss out on bill payment dates, you can always opt for payment reminders instead of setting automatic payments.
- Cut down on smoking and alcohol
Cigarettes and alcohol both are expensive and kills not only your health but also your wallet. You might not even realize how much you spend on these habits every year until you track your expenses thoroughly. If quitting is difficult, at least cut down the consumption. This will also reduce the risk of unnecessary medical expenses.
- Sell things you don’t use anymore
Take a close look at your home and you will see there are many things that you don’t use anymore. A sofa that has been replaced by your favorite bean bag, a television that you don’t watch anymore, a music system that you got as a gift but have never used – you can sell all these items on sites like Marktplaats (NL) or Craigslist and earn some extra bucks. This will also free space in your room.
Your wardrobe might also have a bunch of unnecessary clothes and accessories that you don’t use. You can sell all these online and quickly add money to your world travel fund.
- Don’t spend it on unnecessary home renovations
Home renovations are expensive. We don’t suggest delaying necessary repair work but staying away from flimsy home makeovers can save you a considerable amount of money.
Changing the wallpaper or replacing the curtains of your room is good practice. But if you are planning to travel the world within a year or two, it is best to keep these expenses in check for the time. Add the money you usually spend on these home makeover projects to your travel fund to reach your travel goal quickly.
If you harbor the dream of traveling the world, you should give your best effort to make it happen. This guide will help you to better manage your finances and increase your savings. So that you can travel the world without worrying about money.