It can be daunting to think about spending money (especially on luxury travel) once you retire and are no longer receiving a full-time paycheck. While you may not have quite as much disposable income to fund your travels once you’ve retired, there’s no reason to put an end to exploring the world, especially now that you have more time.
Of course, you need to have a plan. This will make you feel more comfortable and give you peace of mind that you can build travel into your budget even after you’ve said goodbye to the days of daily commutes, communal kitchens, and watercooler convos. Here’s our guide to making retirement travel on a budget a reality.
How Much Do You Have to Spend?
First things first: Identify your total monthly income. Consider pensions, Social Security benefits, 401(k) distributions, part-time job wages, rental properties, etc. Next, determine your fixed monthly expenses like mortgage payments, utilities, groceries, health insurance, home and auto maintenance, and cell phone expenses.
Once you have a feel for how much money is coming into and going out of your bank account each month, you can create a sensible travel budget from the balance. Whether you prefer budget-friendly camping or luxurious ocean cruises, it’s wise to consider your net monthly income before solidifying any travel plans. Here is more help in determining your yearly travel budget.
Where Do You Want to Go?
Once you know how much you have to spend, create a short list of travel experiences you hope to have and destinations you’d like to see in retirement. From here, you can begin to research travel costs and find ways to maximize your travel dollars.
One of the benefits of retirement is that you have more flexibility to travel during off-seasons (U.S. News provides some insight into off-season destinations around the world). You’re no longer bound to set dates, like the week your kids are out of school on spring break (which is when prices are usually at their peak).
In all likelihood, you’ll have the flexibility to travel any day of the week and any time of the year. Not only will you save money as prices dip with lower demand, but you’ll reap the benefit of fewer crowds and shorter lines to contend with on your travels.
Consider that you may also be able to travel for longer periods of time. Let’s say you want to travel to France and Germany but weren’t able to break away for more than a week at a time pre-retirement. Now, you may be able to combine two destinations into one longer vacation, saving money on airfare when you do.
How to Maximize Your Travel Dollars in Retirement
Beyond traveling during the off-season and combining trips (to save money on plane tickets), there are a lot of easy ways to save on travel as a retiree. Since airfare, ground transportation, and hotel stays will make up the bulk of your travel spend, let’s first focus on ways to save some coin on these expenses.
1. Set up Airfare Alerts. Once you’ve settled on a destination, go to a travel site like SkyScanner or Airfarewatchdog to set up flight alerts as soon as you know your dates. These sites will hunt down rock bottom fares for you around the clock and let you know as soon as they’ve got a hot deal you’ll want to jump on.
2. Be in the Know with Newsletters. Not sure exactly where you want to go or when you want to travel? Sign up for e-newsletters (and actually open them when they land in your inbox) to cash in on travel deals. Here are our six favorite email newsletters to get you started.
3. Track Your Car Rental. While the airlines won’t let you change a flight after you’ve booked—at least not without applying a major penalty—car rental companies are typically more flexible. Book a car rental as soon as you know you’re taking a trip, then let AutoSlash track your rental for price drops. When they find a better rate, they’ll let you know and help you re-book, penalty-free.
4. Seek Out the Lowest Gas Prices. Love to road trip? Make sure to bring along a mobile app like GasBuddy that saves you money by finding the cheapest gas in the area, no matter where you are. Also, fill up mid-week since gas prices tend to go up on weekends.
5. Save Up Rewards Points. Why not earn rewards points while making everyday purchases? Hotel and airline credit cards make it easy to earn points you can redeem for free flights, hotel stays, and other upgrades when you spend money on everything from groceries to gym memberships.
6. Get the Best Deal on Hotels. So many (too many) people think that online travel agencies, like Priceline and Expedia, have the best rates on hotel rooms. But as we’ve said before, this is a pretty big misconception. These third-party travel sites are legally barred from posting rates lower than those posted by the hotels themselves. However, they’ll do anything they can to 1) make you think their rates are the best, and 2) get you to book a room with them as quickly as possible. Avoid this confusing price game, and just book your stay directly on the hotel’s website.
7. Use Roomkey to Compare Low Rates for the Best Deals. Here at Roomkey, we let you compare loyalty member rates during your hotel search. Loyalty rates are available to those who have signed up for free hotel rewards programs such as Marriott Bonvoy or IHG Rewards Club. These rates are cheaper per night and tend to offer greater flexibility should you need to change or cancel a reservation. Just as booking direct is the best way to secure your hotel booking, booking a loyalty rate is the best way to get a discounted rate.
Traveling can be such a big part of retirement—something many people look forward to for years. With a little planning, budgeting, and useful money-saving tips, you’ll be well on your way toward tackling your bucket list, all while keeping income and expenses in order for as long as you want to travel.
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