SCE Federal Credit Union Takes Financial Fear Out of Planning Your Next Vacation

Jul 02, 2012 | Tips

Americans logged 1.5 billion leisure trips and averaged 14 vacation days in 2010, according to the Bureau of Labor Statistics. How did they prepare for their excursions?

"There are reams of information on the Internet about every type of vacation," said Abigail Ulm, SCE Federal Credit Union Foundation manager. "This is why we've created a budget template that's easy to use in planning and saving for weekend trips or the once-in-a-lifetime vacation."

How do you know what you can afford to go on a trip?

Will it be London or Los Angeles? Can you afford a vacation or "staycation?"

Ulm offers these financial tips to future travelers:


Know your financial boundaries

Having a good sense of your income and, especially, monthly expenses allows your vacation plan to come together. You don't have to be a millionaire to travel abroad.


Develop an annual budget

By creating a budget that includes income and expenses (e.g., mortgage, rent, auto payments, emergency fund contributions, retirement savings, taxes, meals and entertainment costs), you'll be able to properly plan for your next excursion. A budget should be a household staple.


Put your travel money to work

One way to make your money grow for that upcoming trip is to place it in an account that yields returns and is secure from market downturns. Set up a portion of your paycheck's direct deposit to go to a special vacation club account, super saver account or Money Market account.


Use credit and debit cards to your advantage

SCE Federal Credit Union offers a joint Visa credit card and debit card rewards program that allows you to earn points and redeem them together toward vacations.


Monitor your finances

Regularly check your expenses to see if you're on track. Market and life changes may require you to modify your plan.


Understand the cost of debt

If you plan on putting a vacation on your credit card, which may charge you a variable interest rate and requires a minimum balance payment, you could be paying hundreds to thousands of dollars in interest.


Advanced financial planning helps

The sooner you start saving and planning, the sooner you'll be on vacation. Additionally, travel sites, hotels and airline companies increase their prices as availability decreases, so being one of the first to book may mean you're shopping in a better price range.


Shop smart

Just like at the credit union, where membership has its benefits, shopping through companies like AAA, AARP and Costco will provide discounts on vacation packages. You should also consider traveling during off-peak season and looking at locations "off the beaten path."


Know the true cost of your vacation

Getting to your destination is only the beginning. Put a budget in place for meals, souvenirs and entertainment. If you have children, provide them with a budget, too. This teaches them how to manage money.

With a little planning, your vacation can be a haven from the everyday grind we all lovingly refer to as work. Incorporating a vacation category into your budget allows you to plan and travel with confidence.

At SCE Federal Credit Union, we pride ourselves on providing our members with exceptional service and solutions to promote financial growth. Let our advisors help you achieve your financial goals.