Plan for your vacations

The new song “hafte mein chaar shanivar hone chahiye” from the just released Hindi Bollywood movie “All is Well” truly reflects the state of mind of all working population. Working around the clock for 365 days has made us a ticking time bomb waiting to explode until we plan to give ourselves a break from the regular grind. The break can be any distraction like hiking, trekking or an enrolment at spa wellness resort or even a weekend detour to a local hill station can be refreshing to recharge our tired minds.  To take a break from our hectic schedules is very necessary as it helps in various aspects including improving personal health, family bonding and even improves our performance at work. Out of the major goals listed by our clients, one of the goals is to save for a vacation. Although, one tends to take regular small break but to go on an exotic vacation, one needs to plan it well on monetary terms. What are the aspects one should consider in this plan?

a) Fix the time of travel/ season – Usually a family plans a vacation taking into account the maximum number of common holidays available at work for them and at school for children. So, it is necessary to design your itinerary well in advance as it is most possible to be a busy season at all tourist places. Do a basic short listing on your desired places. From the shortlisted destinations you can work out the probable costs. It is observed that usually in an impromptu weekend plans we tend to spend more. Also, a group tour is less expensive than a customized one.

b)  Budget allocation – In every cash flow we analyse, we always suggest to earmark holidays spends under the discretionary expenses on anticipated or actual basis during the last year. This includes all annual visits to your native village, your social visits outstation or even your small hiking trips. Budget acts as a double check to plan your trip as well as limits your spending on your travel. 

 c) Supplementary expenses – The calculation of expenses on a trip should not be limited to the actual journey expenses or stay cost. It should also include expenses related to food, shopping, tips and visas, in case of foreign travel. Additionally for a foreign travel, it is advised that you take necessary travel insurance for your entire family. 

d) Deal or no deal – Today we come across various online website luring us to new hotels and places with attractive discounts to try them out. They give you deals like free meals, additional one day’s free stay and discounts on their spa services or make your stay at their group hotel free in next six months. Don’t get tempted by the word free. It is best to check the property on your own or follow some acquaintance’s experience before making a final decision. At least, check the reviews of past travellers on aggregator sites (websites like tripadvisor.com) to get an unbiased review. 

e) Consider the inflation – if you plan to make a huge trip in terms of monetary value, it is best to plan at least two years before the actual travel date.  So, it will help your financial planner to help you get sufficient time to allocate the minimal possible amounts every month for your planned trip. It is necessary to consider the currency impact on your trip. Like an increasing pound value would increase your travel expenses on food, entry fees at tourist spots or even shopping cost.

So, how do you plan for a holiday goal?

  Lets’ calculate the cost for one person travelling from Mumbai to Switzerland on 6 night tour package would approximately cost as follows: 

Break Up of Expenses	Approx Expenses	Nature Of expense
Travel Cost ( To & Fro)	Rs 44,000 per person (at least 6 months prior to travel and with lowest duration)	Major & subject to deals
Hotel Stay	Rs. 10,000 – 12,000 per day (double occupancy basis)	Major & subject to season of visit / deals
Food Spends during trip	Rs. 3000 -5,000 per day ( by trams)	Discretionary and variable on family size
Inter city Travel – in case of personal travel		Discretionary and can be avoided
Shopping ( pre & during journey)	Maximum 30% of travel cost –depending on choice for luxury goods and souvenirs	Discretionary
Any Travel Insurance	Rs 2000 – Rs 3000 per person (varies with age)	Necessary and recommended
Visa Cost - Schengen visa	Rs 5,000 per person	Necessary and fixed
Others	Not more than Rs 50,000	Discretionary

Source: www.plannedtraveller.com – helps you plan your travel in an informed manner

So, plan your holiday and most importantly, plan to save for it.    


Regards
Saarthi Financial Planners
www.saarthifp.com


#FinancialPlanning #FP #CFP #SaarthiFinancialPlanners  #SaarthiFP #SaarathiFinancialPlanners #SaarathiFP #SarathiFinancialPlanners #SarathiFP