I tend to jump at any opportunity to go on a trip, whether it be abroad or within Korea (where I currently live). Many people in the past have asked me how can I afford it, and follow up with comments that if they got paid more, they too would travel. While I do get paid decently well, 55% of all my income goes into paying down my student debt, so often I have less to work with than they do. However, I have noticed that both my priorities, and my habits are different from theirs when it comes to what I do with my money. With a few minor tweaks to your life, you too can go travel. Here are some tips that I implement myself as a way to reduce costs and save money for traveling. While money saving tips and travel tips in general are a dime a dozen, I hope to have a different and fresh approach you can actually use.
#5 Don’t Have Kids!
Got your attention? Good, but let me tone it down a bit. Having kids is important to many people, and recently married couples in particular jump at the chance to start a family right away. If you hope to travel to many places in your lifetime, this is a big mistake. Now, personally, I don’t want to have kids, but I am more addicted to traveling than most people. Let me be clear, I am not saying children are a mistake and that you should never have them, but rushing to have them at such a young age is not necessary.
When you are single, dating someone, or recently married, you have a golden opportunity. You have virtually, one income for every one aspiring traveler. Tough math I know! If your girlfriend, wife, or you have a child, what often happens is that the child bearer stops working to raise them (at least for a while, which is a good thing), and suddenly, you have one income for three aspiring travelers. To add insult to injury, kids don’t even appreciate sites (or even remember them as adults) quite as much as you would. Look, there is really no rush. Take your time and enjoy your youth, either by yourself or with your significant other. Have kids at a later time! If you already have kids, leave them with your parents when you get away.
#4 Pay Cash as Much as Possible
Have you ever read on the news about someone winning the lottery, or a government project costing millions of dollars? Do you dwell on how much that is? A Boeing 787 for example, costs about $200 million, does that sound incredible? While we are aware that it is a lot of money, I am willing to bet no one got out of their seat in a rage about these amounts. That is because money amounts printed on a piece of paper (or on a screen) don’t have the same impact in our brains if we don’t physically see it. Physically feeling money leave our hands tends to make us more careful and conservative when it comes to our expenses. A sweater for $50 USD sounds reasonable, until you are letting go of the money at the counter. Use cash as much as possible and you will naturally start seeing a pattern of reduced expenses.
I used to be that kind of person who paid everything with his debit and never carried cash. I would buy things, even if I couldn’t afford them, but didn’t realize it because it was all about making the next minimum payment. While I don’t shun credit cards at all (I use point cards all the time when booking flights), their use should be minimized.
#3 Never Pay with Coins
I don’t really know how I got into the habit of doing this, but I never pay with coins. Every year, I take the coins I have accumulated to the bank and put the money in a special savings account. This turns out to be anywhere from 300-500 dollars a year. While it won’t pay for a full trip, it will seriously increase the possibility and ease of travel, at least from an economical point of view. You might ask, how is this different from opening up a savings account and putting, say, 20 dollars a week in it? I’m glad you asked!
When you pay for a soda, and you pay 1.07 with two dollars, you are aware that it is 1.07 at the time. However, you now have 93 cents in your pocket (my wallet has a pouch for coins, a worthy investment if you ask me). Later, when you try to buy something else, you don’t mathematically calculate what you withdrew and what you spent to know how much you have left, you simply look in your wallet! If you force yourself not to use coins, you start to trick yourself into thinking that you spent more than you actually did. For me, this works because I think twice when purchasing more expensive things (like lunch for example) as I now have less than I expected in my wallet. It is another psychological trick (like cash) to make you more aware of what you spend money on.
Note: If you are in Europe or in Japan where the coins have serious value, try only spending the 2 Euro coins or the 500 Yen coins.
#2 Have Control and Awareness of your Expenses
If someone asked you: How much money do you have in the bank? How much did you spend last month? What is your net worth? What is your total debt right now? What are your total savings? What is your total income before and after taxes? How many of these questions could you answer with certainty? If the answer is “all,” pat yourself in the back! If you have no idea about most of these, it is time you take a closer look. Personally, I know the exact figures of all of these questions, and that’s not because I looked it up to make this post. I swear, I didn’t. You should have a budget of things to spend on, month after month. I know what you are thinking, “I heard this advice before, how is this different like you claimed in the intro?” If you heard it before, did you start doing this? Probably not, but I think I know why.
You can’t change a person. People cannot do things that are wildly outside of their realm of normality. If someone is completely disorganized with their expenses, you can’t expect them to change their habits so wildly as to meticulously calculate every little thing they spend money on. I have actually done this for an entire year, and I will be the first to admit, it is boring as hell! I am also not going to tell you what NOT to waste money on (even if I feel that way). Everyone has different values. What I will tell you, is to limit how frequently you spend, and this is how:
Give yourself an allowance, which is significantly lower than your take home money. For example, if you earn 400 dollars a week, give yourself 200. You can spend that 200 however you want (this is key). Since you are following rule #3, you are not using coins and the money will go faster than you think. If, for whatever reason, it was a slow week, spoil yourself a bit next week, it will keep you motivated (and sane) to keep this system. Of the left over 200, save it in an account. Plan your trips in advance to get you excited (and it is much cheaper to book in advance anyways). Soon, you will start having better control over where your money goes.
#1 Never Buy Something The First Time You See It
I have been wanting a Nintendo DS for the better part of three years. Every time I go to the supermarket, I think about some cool games I could play, and now I’m told, Ocarina of Time [a classic Zelda game] is out for the Nintendo 3Ds, too! However, I haven’t bought one, even though I am more than capable of affording it, and it won’t put much of a dent on my expenses. So, what’s the deal right? Frankly, not only do I not really need it (which is a common tip for saving money, “don’t buy things you don’t need”) but the happiness to cost ratio is too low. Let me explain:
In my opinion, people seek happiness more than anything in the world. In many ways, possessions and material goods don’t really have a value if people around us (friends or not) are not admiring them. Think about this: If you were one of the last people in the world, would you still care whether your shoes were designer and $300, or would you go for whatever is more comfortable? Peer approval is a form of happiness, one that we are all slaves to, but that doesn’t mean it is a bad thing.
What is important is to put an actual value on how much happiness something brings you. To me, the memory of an awesome travel experience is one of the things that brings me immense happiness. While I would be super excited to play my Nintendo the first few weeks, it is quite expensive compared to the overall happiness it would bring me [which I call, a low “happiness to cost ratio“]. The only reason I am aware of this is because I didn’t buy it the first time I saw it. People are often impulsive, myself included, but we don’t have to be. The Nintendo DS, and many products we buy, are very stable when it comes to price, so it doesn’t really matter when you buy it. When you see something new, never buy it right away. Go home, and think about how different you would feel with this new product. Then think, how different would you feel that you bought it a year from now. If you think you probably won’t care in a year, you probably are better off saving the money.
Following these tips, you will start seeing some savings that you can definitely use for traveling!
Do you have any other saving tips that are a bit unusual?
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