Can You Afford to Go On Vacation? 5 Questions to Ask Yourself Before You Book That Trip

Can you afford a vacation?

According to a new Bankrate survey, 24% of Americans say they don’t have the money to take a summer vacation this year and nearly half of those surveyed say they won’t be taking vacation at all.

That’s too bad. After all, there are good reasons to take vacations. Time off from work and routine can rejuvenate your creativity and improve your focus, productivity and physical and mental health. However, if your vacation is going to leave you with debt, financial instability and stress, the consequences of that decision will likely outweigh the benefits.

To ensure your vacation will pay off long after you return to the office, consider these 5 questions:

1. Did you budget for a vacation?

Rarely, if ever, does a vacation come as a “surprise expense.” If you know you hit the beach each March or the lake house every August, it’s easy to plan ahead. To budget for your vacation, simply tally up what you spend on vacations a year and divide by 12 to calculate what you need to save each month. Setting money away before you leave makes for a lighter credit card (and conscience) when you return.

2. Is your debt under control?

Spending some of your extra cash on something other than “good debt” (mortgage or student loans, for example) can help you avoid burnout that could have much more dire financial consequences down the line. If you’re still paying off your credit card debt from your last vacation (or crisis), however, now is not the time to spend more.

3. Do you have emergency savings set aside?

Vacations are time off from the daily routine and stress of earning a living. However, if you are living paycheck-to-paycheck without several months of expenses set aside, you are asking for much greater stress down the line. Particularly if you or a family member’s health or employment status looks unstable, this is the year to splurge on your long-term peace of mind instead of blowing cash on a week’s worth of relaxation. Additionally, for the price of one meal per month, purchasing job loss or income loss insurance may be just what you need to justify this trip.

4. Can you do it for less money?

Traveling on a budget doesn’t have to mean sacrificing fun or even comfort. Who says a vacation has to involve a plane trip and resort-hotel amenities, anyway? Can you take a long weekend to hike at a nearby park? What about taking a staycation with each day planned by a different member of the family? Have you accrued airline miles or other rewards you can cash in? Would renting a place with a kitchen keep you from spending unnecessary dollars on eating out? Here are a handful of vacation-spending hacks to heed.

5. Can you cut back now to spend later?  

If your trip’s already planned, then you have motivation in spades. Take this opportunity to refrain from eating out and buying the new sandals you don’t really need. Cut your entertainment subscriptions for the summer months. Each time you are tempted to grab a to-go coffee or purchase some other simple convenience, remind yourself that each little sacrifice now means your vacation will be even better. Throw the money you don’t spend into a can and watch it build. A little discipline can go a long way.

Vacations are meant to be relaxing, rejuvenating, and restorative. If yours requires you compromise your financial wellbeing, reconsider the vacation you want for the security you need.