I have never had excess amounts of money. I’m not from a privileged family. I’ve never had a really high paying job. But I still travel a lot and I’m asked how I afford to travel. Well, a lot of my travels were through exchanges where I would save up as much money as possible but also helped by scholarships.
But surprise! I graduated university in June 2013 and no longer have that student title to travel on. So, now I have to work and save money. No big. I can do this!
I’ve been travelling New Zealand for a month now and decided I’d share with you how I’ve managed to save $8000 towards my current travel. How did I do this in 10 months with a 30K job? A thrifty lifestyle and easy money saving techniques.
Automatic Savings Transfers
Set up an automated transfer into your savings account – say $50 every week. You don’t even think about it and BAM there’s an extra $200 in your savings a month. This is how I saved a lot of money for my exchange in Singapore and it worked really well. Over the last year, I didn’t use this because I was paid monthly and sometimes I need extra money in my account (for car problems, emergencies, etc.) at the end of the month. But I did sort out a different system that worked…
Because I only got paid once a month, the automatic transfer method that I used to use wasn’t going to work. Instead, every time I got paid, I’d look at how much money I had before getting paid and transfer that into my savings. It’s like living paycheck-to-paycheck but instead of spending all your money, you’re moving everything you didn’t use into a savings account.
Track Your Money
Those $2 morning coffees will add up (I’m not even going to mention what cutting the $7 fancy stuff could save you). You need to keep track of everything you spend. Even when you take out a wad of cash – don’t just write it off as “cash”. That cash should be used towards food or gas. Nothing is frivolous spending money when in saving mode!
Create a Budget that Suits You
After a couple months of tracking my spending, I worked out a budget of how much money per month I would need to survive. I budgeted a certain amount for the different categories in my life. There was the basics: rent, internet, phone, car, food. But I also took into consideration stuff like: hygiene (beauty products, laundry, medication, etc.), entertainment (train tickets, drinks with friends, etc.), and extras (for clothes or when things break around my apartment). Looking at how much I had spent in each category every day or two, I knew right away when I started spending a bit too much money on something and needed to get back on track.
Set a Goal
My goal was to save $1000 per month (after paying off my max out credit cards from my post-grad-and-still-jobless era). On my spreadsheet that I kept to track my spending, I also had a “saving” category that always had $1000 in it. That way when I looked at my balance on the spreadsheet, I saw $1000 less than what was actually in my bank account. This helped to trick myself into thinking I had less money than I actually do so I would stick to my budget.
Give Up the Luxuries
Don’t eat out. Don’t buy designer brands. Those are luxuries – not necessities. If you want to travel, you need to make it a priority. I’m not saying you can’t indulge a little now and then, like I said earlier, create a budget that suits you. I budgeted in going out with friends and having fun but made a limit of spending $80 a month on that. I budgeted for new clothes and other things but made a limit of $150 a month on that. It’s about scaling back and making the most out of your money.
Shop at Discount Stores
I could buy tape and markers at an office supply store or I could buy it at the dollar store. Pick the dollar store! Different stores will have different price points for the same product. Go to the store with the lower price. If you’re not sure what store is cheaper to shop at, check local flyers. Flyer not only show you the current specials but if you compare the prices between them, it will give you a general idea of the store as a whole.
Choose the Sale Item
My diet mostly consisted of whatever was on sale that week at the grocery store. Oh, soups are on sale, I’ll take that. The strawberries are cheaper than the blueberries? Looks like I’m having strawberries this week. This can apply to all kinds of things. Need more lotion? Well, the brand you usually get is $5 but that other one is on sale for $3. Always go for the cheaper/sale version of the same product – you probably won’t notice much of a difference.
Use Up Everything
For the last couple months, I’ve been just counting down the days until I take off so I’ve been finishing off and using up everything in my apartment. It’s a good idea to use up things you have, even in situations where you’d usually go buy more. This also helps in reducing what you’re leaving behind when you’re gone. Don’t buy new food until your cupboards are actually empty. Yes, this includes that last packet of oatmeal. And when you realize that you’re going to need to buy more toilet paper because 1 roll isn’t going to last until you move out of your apartment in 2 months, buy the smallest package possible. Sure, it’s a better deal to buy the value pack, but you’ll be spending more money and wondering what to do with 40 rolls of toilet paper when you’re ready to travel. It’s not worth it.
So, there you have it. That’s my comprehensive guide on how to save money for travel and how I can to afford to take off the New Zealand. What are you’re money saving techniques?