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As the days grow longer and warmer, I am sure that you are planning a summer vacation!  But before we pack our bags and embark on adventures, it’s crucial to pause and consider a fundamental question that MANY DO NOT ASK:

How much vacation can I afford?

In today’s episode, we’ll delve into practical strategies and insightful advice to help you navigate this financial decision with confidence. Whether you’re dreaming of a relaxing beach getaway or an exhilarating international adventure, join us as we uncover the keys to determining your vacation budget and ensuring your travels align harmoniously with your financial goals. YES, you can have your travels and financial goals align harmoniously!   Get ready to embark on a journey toward smart and stress-free vacation planning!


Is taking a vacation wise stewardship?

Check out episode 034.

In the truest sense of the word, a vacation is a time of rest.

  • In Genesis 2:2-3, we read that even God rested after creation.
  • In Exodus 20:8–11, God specifically and directly tells His people that they are to rest from their daily labor on the seventh day!  
  • If you took the time to research it, you would find over 100 instances of the word “Sabbath” throughout Scripture.
  • In the New Testament, Jesus said the Sabbath was made for man, meaning that God gave it as a gift to us (Mark 2:27).

Clearly, there is a need, built into us by God, to have a time of rest.  Not just every night in our time of sleep, but a regular and even scheduled extended time of rest, relaxation, and rejuvenation for the heart, mind, body and soul.  

But what is your motive for a vacation? Answering this question will help you figure out if a vacation is a good idea!

 

“Good” motives for a vacation:

  • Get away from day-to-day life to rest on many different levels and refocus on God
  • Learn some things that will draw you closer to God
  • Learn some new things that are of interest to you.
  • Grow relationships with your spouse, family or close friends
  • Experience God’s world in a way that will lead you to worship Him

“Bad” motives for a vacation:

  • Show-off your wealth (or your debt) and ability to travel to your friends/family/co-workers
  • Escape from your problems at home instead of addressing them
  • Satisfy a fleeting or impulsive desire

Please hear us loud and clear…we are PRO VACATION!  We believe that vacations are not just important, but very important for your health and well-being. We need times where we can unplug (and yes, that includes your phone) and change the pace! However, the “where” and “how much we spend” needs to be done with much wisdom! 

If we are foolish in how we fund a vacation, the obvious outcome is that we will be setting ourselves up for future failure.

Vacations ARE wise stewardship, if you plan and prepare well.  But what is another factor that the wise steward ought to factor into their vacation planning?

 

Consider your Stage of Life

We have all played around on Zillow or Realtor.com, looking at houses that are way out of our league. You can select a house, go to the ‘finance’ section, and see how much the monthly payment would be if you put down “X” dollars.

We quickly are hit with the sobering reality that some houses are just too expensive and we would be foolish to buy them in our current stage of life. 

Vacations can, and often do function in the same way.

If we are in a stage of life where we are trying to pay off debt, and have very little margin in our budget, a $10,000 exotic vacation may not be (or better said, IS NOT) a wise decision. In fact, there’s a good chance you may, or will have to take out a loan or put it on your credit card, and end up paying for it over the long haul.  This is an example of a vacation that you cannot really afford (especially if you are taking out loans).

On the flip side, maybe you have spent the last 20-40 years working hard, saving, giving, investing and you have built up a little nest egg that affords you the ability to fund a $20,000 vacation with your entire family!  If this is you, this could be a great opportunity, and an amazing memory for you and your family! 

Nice and even extravagant vacations are not bad at all!  But we must first ask ourselves if we can really afford them and continue living within the 5 Biblical Financial Priorities that we teach and preach here on the Stewardology Podcast.

 

How much Vacation Can I afford?

Determining how much vacation you can afford depends on various factors including your income, expenses, savings goals, and your current and future financial priorities. Here’s a general approach to help you assess how much vacation you can afford:

  1. Evaluate your financial situation: Review your income, expenses, and savings. Calculate your disposable income, which is your income after deducting taxes and necessary expenses such as rent/mortgage, utilities, groceries, debt payments, and savings contributions.
    1. Don’t sacrifice EVEN ONE of your essential savings buckets to fund a vacation.
      1. Don’t dip into future needed funds to make the vacation bigger and better!  Remember, you will NEED those funds!
    2. Don’t finance a vacation.
      1. With interest rates as high as they are, your financed vacation could be amazingly costly if you do not bankroll it with what you currently have saved!
  2. Set a budget for vacation: Decide how much you’re willing to allocate monthly from your disposable income towards vacation expenses. This should include costs such as transportation, accommodation, food, activities, and souvenirs.
  3. Consider your savings goals: Assess your short-term and long-term savings goals. Ensure that your vacation budget doesn’t jeopardize your ability to meet essential savings goals, such as an emergency fund, retirement savings, or other financial priorities.  Any “dipping” into these areas will set you back in your overall financial planning.
  4. Factor in additional expenses: Remember to account for any additional expenses associated with your vacation, such as travel insurance, visa fees, pet care, or house-sitting expenses if you’re leaving home.  There are almost always those “unexpected” expenses.  Build into your budget a little extra just in case you need it.
  5. Review your timeline: Consider the timing of your vacation and whether you’ll need to save up for it over time. Adjust your budget accordingly to ensure you have enough funds by your desired travel date.  More often than not, a spur of the moment vacation is not doable unless you have budgeted for it and that is how you typically roll.  Planning ahead is wise!
  6. Be realistic: Be honest with yourself about what you can afford. It’s essential to enjoy your vacation without worrying about financial strain afterward.  Sometimes a shorter or closer to home vacation may be a better choice.  It may even be a series of day-trips and staying overnight at home.  Work within what you can afford…not what you want to spend.
  7. Explore cost-saving measures: Look for ways to reduce vacation costs without compromising your experience. This could involve choosing budget-friendly destinations, traveling during off-peak seasons, using rewards points or travel discounts, or opting for less expensive accommodations or activities.  Remember it is about the people you are with, the fun and the memories.

By carefully assessing your financial situation and setting a realistic budget, you can determine how much vacation you can comfortably afford without jeopardizing your overall financial health. If you’re unsure about specific figures or need personalized advice, consider consulting with a financial advisor.

“Happy” Travels

If we plan our vacations well, and we can truly afford these vacations, your refreshment will not just be while on vacation, but afterwards knowing that you have met your goals and not jeopardized your financial future.  In planning and preparing this way, refreshment is sure to happen!

If you have ever gone on vacation, and have wondered during the vacation how you are going to pay for it, you quickly realized that the vacation went from fun to worrisome. Spending a vacation worrying about how you are going to pay for it is no vacation. 

To have the best experience before, during, and after your trip, you need to know that you can afford it. 

There WILL be unplanned expenses, for sure. But if you know ahead of time that this will happen, it will allow you to plan ahead of time. Plan for the unexpected! Allow for a little bit of a surplus in your vacation budget so you can handle those unplanned expenses. 

Vacation emergency fund should not be confused with your actual emergency fund (it’s in addition to!)

Stewardship Application

  • The good steward goes away on vacation, but only when he knows he can afford it.
  • The good steward saves and spends up front instead of going into debt (either with a loan or a credit card monthly bill).
  • The good steward decides on trips that make sense for his family AND their financial picture.
  • The good steward plans vacations in a way to compliment his family’s financial goals, not complicate them. 
  • The good steward guides his family toward spiritual and physical refreshment, which doesn’t need a high price tag.

For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to complete it? (Luke 14:28, ESV)  

Yes, this verse is about discipleship without a doubt. As you prepare for and plan your vacation, for those that are watching you, you are discipling them through what you are doing and how you are paying for your refreshment and relaxation.  Discipleship is not just taught, but it is caught!

Next Steps

 

Material presented is property of The Stewardology Podcast, a ministry of Life Financial Group and Life Institute. You may not copy, reproduce, modify, create derivative works, or exploit any content without the expressed written permission of The Stewardology Podcast. For more information, contact us at Contact@StewardologyPodcast.com or (800) 688-5800.

The topics discussed in this podcast are for general information only and are not intended to provide specific investment advice or recommendations.Investing and investment strategies involve risk including the potential loss of principal. Past performance is not a guarantee of future results.

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