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How To Save Money Traveling Like A Boss

December 19, 2014 in Financial Planning by

The United States is the only developed country in the world that legally isn’t required to pay for a single vacation. Meanwhile, hop over to Spain or France, and you’ll get 34 and 31 vacation days, respectively. If you think higher vacation days leads to lower productivity and higher unemployment, let’s take a look at powerhouse Germany, with 34 vacation days a year and a 4.9% unemployment rate. That’s a full 1% lower than the current US unemployment rate as of October, 2014.

Clearly, 16 paid vacation days and holidays for the average private sector US worker based on a report released by the Center for Economic Policy and Research (CEPR) seems low in comparison.

Why are we hesitant to take our rightly-earned paid time off? The most obvious answer is that, after living through the Great Recession, many of us are just happy to have a job. We don’t want to jeopardize our employment status. Some fear that, if they do take vacation, they’ll miss out on key opportunities and information.

But the facts show that taking time away from the office has positive career consequences. Studies have shown that after a vacation performance and productivity can increase. And those who take more time off tend to get more raises and promotions.

So, now that you’re more open to using that bank of PTO before next year rolls around, how do you do so without breaking the actual bank? Vacations can be expensive. Flights, airfare, food, ground transportation and entertainment. For many, a week away can easily cost thousands, eat away at hard-earned savings, and even plunge a family into credit card debt. But it doesn’t have to be that way.

I just got back from a relaxing, fun trip to Hawaii. As a premier travel destination, particularly in the winter, Hawaii is not a cheap place to travel. And I booked my getaway with less than two weeks notice, in the window when airfare prices escalate. Though I expected I would spend a lot more than I did, I managed to go for five days and spend a little over $500 — on airfare, hotels, food, entertainment, etc.

Frugality didn’t mean compromising on quality. I stayed in a beachfront property, rented a car, swam in waterfalls and in the ocean, and ate a few meals at fancy restaurants.

Here are some trip hacks to help you plan a cheap trip without sacrificing the fun. If you are taking a vacation, you better enjoy it. You just don’t need a financial hangover when you return.

EIGHT TRAVEL TIPS TO SAVE YOU MONEY

1) Avoid traveling to developed markets. It sounds so obvious, but it’s the single biggest factor in reducing the day-to-day expenses when you’re traveling. An African safari or a trip to Antarctica will deplete your savings before you can say “elephant” or “iceberg”. But an exploration of some Latin American countries or Southeast Asia will keep money in your pocket longer, which means you can stay on vacation longer, as well. Check out this list of some of the world’s cheapest destinations.

2) Use points or miles for airfare. I spent nothing for my round-trip flights to Hawaii. Earlier this year I signed up for the Chase Sapphire Preferred credit card and got 40,000 points just by spending $4,000 with the card in the first three months. I traded in only 36,000 of those points for my round-trip airfare to Hawaii. For signing up and using the card, you basically get a free flight. Of course, I pay off my balance each and every month.

3) Take a road trip. The great writer, Ralph Waldo Emerson is attributed with first saying that “life is a journey, and not a destination.” What could be more of a journey than a road trip? This is a simple hack, as it cuts out the cost of airfare and rental cars. For the cost of filling up your gas tank, you can head out and explore vast, diverse countries.

4) Look beyond traditional hotels. My friend and I traveled to Hawaii together, and our biggest hack of the trip was his find of our rental on Airbnb. It was a private, small apartment with beach access on the North Shore of Oahu. Our rental is just one of many amazing properties listed on Airbnb’s site that are significantly cheaper than comparable hotel accommodations. One of my other good friends, who wanted to see the world on the cheap, just stayed in rooms he found on Airbnb in Tel Aviv and Tokyo.

5) Collect and use hotel points. Any time I travel for work I am religious about staying in a hotel affiliated with the SPG program. Starwood (the parent company of Westin, Sheraton, and the W) operates one of the best loyalty programs out there. It’s easy to collect points by staying in their hotels or just by using the SPG credit card from American Express to make any purchase. I now have a lot of Starwood points, and I’ve used them to stay in five-star hotels in Asia or get week-long stays at Caribbean resorts, all free of charge.

6) Do as locals do to save money. Travel and lodging, not your daily activities, should be your primary expenditures. In Europe, meandering down old streets and into medieval churches is free. In the US, it’s inexpensive to explore our national parks. And it costs nothing to relax by the water on any ocean-side vacation. In Hawaii, we hiked along the western-most point of Oahu, with breathtaking views of moss-covered mountains descending into the clear blue water. Cost of the hike: $0.

7) Get the company to pay. Tacking on a personal trip before or after a business trip is a great way to get free airfare and explore a place you’ve always been meaning to see. A few years ago, I worked in India on a three-week work assignment. I took full advantage and explored India for an additional three weeks after my project concluded. It was an incredible experience — made all the better because I didn’t have to pay for airfare.

8) Take a really long trip. The real travel hack for the under-30 millennial is to travel extensively while still young. This is the time in our lives when we are least likely to be encumbered by family and work obligations. I backpacked across Europe staying in hostels and with host families and I explored Latin America for weeks with classmates. These longer trips led to self-discovery and friendships that you can’t put a price tag on.

TRAVEL DOESN’T HAVE TO BE EXPENSIVE

It would be a shame if one of the reasons why Americans don’t take more vacation is due to cost. Once we get over our fears of being left behind by employers for taking all of our allotted vacation days, I’m sure the above tips will help you save more money on your next trip!

Related Post:

A Checklist To Consider When Retiring Abroad

Photo credit: NC Sizemore Flickr Creative commons

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Michael Ruderman

Michael Ruderman

Michael is Director of Marketing at Personal Capital. He oversees cross-functional growth and engagement projects for over 1 million Personal Capital users. He is also a regular contributor to the Huffington Post and holds an MBA from Stanford.

One Response

  1. Sify Newton

    Hey Michael thanks for sharing useful info with us, it can be a very helpful to all who wants to save the money on traveling.

    Reply

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