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How To Financially Plan For A Vacation?


You may have many famous Indian or international holiday spots in your bucket list that you would wish to visit with your family or friends. More often then not, it is the money constraints and not the time limitation that stops us from taking that much-awaited trip.

However, like all investments, if you start planning early and stay disciplined with your deposits, you will have enough to visit one destination every year. If you plan on taking the trip with your spouse or a limited number of friends, you could also pool together the money in a fund to help get higher returns and also spend less.



It is better to have saved at least 2 months ahead of the actual trip. This will allow you to have funds to purchased discounted air tickets that carriers provided on advanced bookings.

You will also have better luck with hotel booking options that suit your budget. As you draw closer to the day of travel, air or bus tickets, as well as hotel rooms, get expensive and you will not have many options to choose from. If you are want to book a particular homestay, you should start sooner.

There are multiple fare comparison websites and apps that you can use to make calculated choices. Advance planning also leaves you time to make any last minute purchases that you may have.

Systematic investments

Systematic investments

Build a separate fund exclusively for your vacation spending like you would do for an emergency fund. You can choose to open a recurring deposit account or place money in a liquid fund or short-term debt fund every month. Liquid and short debt funds come with good returns and no exit load. It is better to pick these options over a savings account to earn higher returns and also avoid spending away the money elsewhere.

Try and put away at least 5 to 10 percent of your pay in this fund. If you wish to a more exotic foreign destination like Bahamas or Paris, you may need to draw more and for a longer time to have sufficient amount to vacation comfortably.

You and your spouse can collectively put away a decent share towards the fund. Any excess amount accumulated can then be locked away in an FD for future use.



Though there are many packaged deals available with travel companies, it will prove expensive and will not give you the flexibility to tailor your vacation. You may end up paying for locations or services you did not want in the first place.

Whether or not you choose to go with a travel agent, conduct your own research on the places you want to see and how much it would cost.

Additionally, if it is a location outside, understand the visa regulations and get it sorted much before you leave. You also need to look at the currency exchange issues. You could carry more accepted currencies like the US dollars with you from India but make sure not carry them in excess.

Credit cards will be of help in emergencies. To save on transaction charges, use credit cards as less as you can and carry money in a Forex card instead.

If you need to, get international roaming packs activated on your phone to suit your budget.

Sort all these probable expenses before you leave.

Stick to the budget

Stick to the budget

Choose locations that are feasible for you and not taking away funds required for any urgent need at hand like your child's school fees. You can also skip any extra services provided by the hotel that you can do away with. You also need to keep emergency spends in mind when you plan your budget and try not to go overboard and spend it all.

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