How long does it take to save for a holiday?

Is this what I’m writing about today?

Sure is! Somewhere we all have a guilty, selfish, perverse dream to take a holiday somewhere exotic. So how long does it take to save for a holiday? Before I move forward, this dream is not selfish, perverse or something you should feel guilty about. As you’ll see you’re going to deserve it more than you know.

Instead it is something that should be chased especially as a personal reward for years of services rendered at your job.

Yet there are far too many people whose identities are built up around their work and what they do, and taking the time to reward oneself and actually live a little is the one of the last things that people get to do.

Somewhere along the life journey the narrative has become ‘live to work’, not ‘work to live.’ I unsubscribed from this newsletter years ago, and I hope you will too.

How much does ‘that’ holiday cost?

The world is a big place. It is full of wonder, sights and above all experiences which enrich and make people better. But these life experiences unfortunately aren’t cheap. So how much does a holiday cost?

There are two currencies that have to be factored in here.

Money and Time!

Firstly there is the money side of things. If you choose to take a holiday package, then holidays can range from $1,000 through to $5,000 per week, and that’s before the added luxuries that will make themselves available to you whilst you’re actually on holiday. Currency exchange, tips, booze, and food are just a few to name here now.

The second factor is the time. Depending on your work arrangement this will mean you’ll be using annual leave. If you want to go away for 10 days then that means you can technically achieve it within one working year. If you want to go away for longer then you’ll need to spend more time banking time just to be able to go away.

I’ve had the privilege of meeting travellers who have had to leave their jobs because the boss simply wouldn’t let them leave!

There are reasons that they are called ‘once in a lifetime’ holiday’s.

If your dream is a 6 week holiday to an exotic location then the chances are you’ll either need to have long service leave, use unpaid leave or even simply resign just to be able to take the time off.

When most people can only bank away [net] about 7-8 days of annual leave per year, it would take about 4 years just to accrue the time needed for the holiday.

When budgeting for $5,000 per week, you’re also looking at $30,000 in your pocket before you go.

Related: How much do you need to retire early?

Funding

Now that you can appreciate that it can take 4 years to plan and prepare for the ‘once in a lifetime’ holiday it’s time to start putting the preparations in place.

40% of the workforce is reported to only be able to support themselves for a single pay-check in the event they lose their source of income today.

This holiday scenario above dictates that $7,500 is saved annually just to support an average of 1.5 weeks off per year.

From here the maths becomes simple. You need to set aside $290 per fortnightly pay cycle for 4 years to go on holiday, and make sure your circumstances that will allow you to go don’t change.

Related: What $150,000 looks like for your financial independence.

The true reality.

Circumstances change! The car will break down, unexpected bills will come up and above all else life will happen.

When we look at holiday packages, the $5,000 per week range is a bit beyond the average person. Simply put this means that the amount per fortnight that needs to be allocated to the holiday fund will be lower but very little will change the time cost.

Far too often the idea of travelling and ‘living’ life remains just that. An idea which we all like, but get to do only ever so often.

Life demands a high price and somewhere in there you’re given ‘time off.’ But there is a difference between having ‘time off’ and being able to use it.

Related: How you’ve been setup for financial failure

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#Wealth #personalfinance #retirement #financialindependence

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