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10 tips for budgeting for a holiday

​With winter behind us, many people are starting to think about taking a holiday. But a holiday that comes with the baggage of credit card debt or financial stress is not a holiday. Follow these 10 tips for a holiday that’s free of money worries.

1. Start planning early. Family holidays, even local ones, are rarely cheap and the longer you have to save, the more options you’ll have in terms of your destination and activities when you get there.

2. Work out how much you can afford for your holiday by creating a family budget. If there’s no room in your budget for savings, it’s a warning sign to look seriously at your expenses. What expenses can you cut back on? Budgeting is the only way to work out how much you can afford to spend on your holiday.

3. Get the kids involved. Share your family holiday ideas and plans with the whole family. Ask for their input and explain that you’re saving for a holiday. What can they do to help? Some suggestions: Contribute some of their pocket money, reduce the family’s household bills by turning off lights, closing doors and taking shorter showers, save some of their pocket money for personal holiday spending.

4. Open a special bank account for your holiday savings. Have a proportion of your pay deposited directly into this account by your employer or set up an automatic transfer so that your holiday savings never touch your pocket.

5. Think local. The cost of airfares quickly adds up, especially when a family includes multiple children. Remember, the best part about a holiday is the change of scenery and break from routine. Don’t overlook cheap and cheery local destinations.

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6. Think off-peak. Some destinations offer amazing discounts during their off-peak seasons. Visiting ski country in the thick of winter might not be affordable, but the same chalets and lodges offer great deals for summer. Beware, however, that the low and shoulder seasons for some destinations may come with the increased chance of bad weather or other not-so-nice conditions.

7. Anticipate all of your holiday costs. Don’t be caught short — make a holiday budget and stick to it. Your potential list of budget items will include transport (airfares, petrol, car hire etc), accommodation, meals, snacks and drinks, entertainment, tours and activities, shopping, travel insurance, costs of visas and/or vaccinations, and contingency money for unexpected expenses.

8. Shop around. It pays to shop around for the best price. If you’re flying, it’s especially important to reserve your seats early. Don’t forget to check aggregator websites, such as, and

9. While on holiday, use cash rather than credit. That doesn’t mean carrying around big wads of money. Within Australia, it’s as simple as using a debit card. For overseas travellers, most banks now provide travel cards which are a cross between traveller’s cheques and a credit card. A travel card can be pre-loaded with your own funds in the currency of the country in which you’ll be travelling. It works just like a debit card for purchases and for cash withdrawals at ATMs.

10. Consider “staycationing”. Really strapped for cash? “Staycationing” involves holidaying in and around your own home. To get the most out of staycationing, you need to treat it like a proper holiday — take the phone off the hook, stop checking your email, and pre-plan special treats and experiences that indulge every member of the family.

This article was featured in The Advertiser ‘My Week’ lift-out on 10 October, 2011. Catch more of Tammy’s money-wise tips in The Advertiser every Monday and in other News Limited publications.

This article has been prepared for information purposes only, and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information in this article you should consider the appropriateness of the information having regard to your objectives, financial situation and needs.