Setting Up a Travel Fund Using the Nav.It Money App
If you’re feeling overwhelmed by the trip planning process, first things first, take a deep breath and let it sink in that you’re actually going on a trip.Perhaps this is a trip to one of your favorite places in the world (Iceland is mine) or maybe you’re going to a newcountry where you don’t speak the language. Either way, you’re planning a trip and that’s exciting!While there may be a lot of prep work involved before you go, I will help you break down one of the hardest components: getting the funds to go on the trip. There are many tips and tricks to make saving for vacation simple and consistent.
And you can take advantage of a digital tool at your disposal. Think of Nav.it as your ultimate save for vacation app.
Different funds for different accounts
When it comes to budgeting in general, I recommendseparating your money into multiple bank accounts. If you want to travel the world, one bank account that I highly recommend having is a “travel fund”. A travel fund is simply a bank account where you save money for travel.
Why have a travel fund?
Having a bank account dedicated to travel ensures that you’re actively working toward your travel savings goals. It prevents overspending and undersaving, and at a glance, you know exactly how much you have saved up for a trip.Your travel fund can be a checking account, a savings account or money market. Give this special bank account a nickname like “Weekend Getaway with Bae”.
Tool tip: Want to see all of your money in one place? Using Nav.it, you can connect your savings, checking and credit card accounts so you can see all transactions and saved up funds in one place and get an overview of your overall spending.
Using the Auto-Save function inside the app will help you decide how much you might be able to contribute to your “Weekend Getaway” fund (and if skipping a couple latte runs might help you reach your travel goals sooner!).
Why save for travel consistently?
After you open a bank account devoted solely to travel, it makes it easy to save for your next adventure each paycheck.Determine an amount you can afford to save per pay period and automatically save that same amount each time you get paid via direct deposit.
If there is a category on your overall monthly spending that you want to reduce (lattes, brunches, impulse shopping buys), you can change the budget line total for the month, and then set up alerts to ping you when you’ve spent 50 or 90 percent of that line item.
Let the app do the work for you!
How I plan for my trips
When I first started traveling, I saved $25 each paycheck. Now I save upwards of $200 per month. Whatever amount you decide to save, remember to save consistently. Consistency is key to developing good financial habits.Saving consistently also means that you’ll have money available to hop on agood flight deal or go on a spontaneous trip without having to worry about your finances. Woohoo! Sounds nice, right?
The key takeaway here, automate saving for travel.
Budget for your trip
Next, create a budget for your vacation. Put together a list of places you want to visit and use blogs to figure out how much it will cost you to get there, eat, and do fun activities.
Pro Tip:Budget Your Trip is a helpful resource for determining travel costs around the world. Add all of your travel costs together to set your vacation budget.
Tool tip: The nav.it money app has yet another feature to help you reach your happiness (aka travel) goals! On the Money tab, scroll down to Auto-Save to set up your trip goal (the magic number you figured out above), and it will show you how much you need to save per day (or week, or month) to achieve these goals.Once you have a trip budget, start looking for flight deals! You’ve conquered a major milestone, Nav.igator!
We’re changing the narrative around money but change can’t happen with a one-sided conversation. That’s why we’re excited to bring different voices and experts to share their wisdom. Send us an email and let us know what you think. And remember the nav.it money app offers you free tools for checking in and managing your money moves.