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Here are 4 money-saving tips for your next vacation from a financial literacy expert

Dec. 06, 2021
5 min read
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With parts of the world reopening to tourists, many people may be looking to plan their next vacation. For some, this may be the first time they’re venturing out since the onset of the coronavirus pandemic — and even with many travelers sitting on large stockpiles of points and miles, trips can be costly.

Sure, you can potentially use your rewards to cover your flights and hotel stays — but then there’s food, tours, entrance fees to attractions, souvenirs and many other expenses. These can quickly add up, and if you’re not careful, they could cause a major hit to your household’s bottom line.

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Fortunately, there are a number of concrete steps you can take now to save money as you look ahead to your 2022 travels.

Here are some ways to help pay for your next trip from Shirley Yang, vice president, Marcus by Goldman Sachs.

Set a goal — and a date to reach it

The first part of this suggestion is relatively simple. After all, anyone can set a goal. But according to Yang, setting a concrete deadline by which to hit that goal is what’s complicated.

“Start off with estimating the extra expenses you expect to incur during the trip,” she says. “Then, pick a specific date at least a month in advance of your departure date to have that amount of money set aside for your trip. This gives you a concrete deadline but also allows a grace period in case you come up just a bit short.”

It may seem simple, but just putting pen to paper and articulating your goal and date to reach it can go a long way toward setting you up for success.

Related: 9 tips for taking a luxury vacation on a budget

Open a high-yield savings account

Once you have your goal in mind, another great step to take is to open a high-yield savings account (HYSA). You might currently have a traditional savings account affiliated with your primary checking accounts at your bank, but whether you have $10 or $10,000 in there, it’s probably earning next to nothing in interest.

Compare that with the high-yield Online Savings Account from Marcus by Goldman Sachs that’s currently offering an Annual Percentage Yield (APY) of 0.50% as of today (Dec. 7, 2021). That’s more than four times higher than the national average.

With no minimum deposit, no fees, same-day transfers to (and from) most banks, and FDIC insurance, this could give your cash reserves a nice boost according to Yang.

There are many ways to save on your everyday purchases. (Photo by Eternity in an Instant/Getty Images)

Find ways to save on household expenses

Another way to save for your next trip involves those everyday purchases you make. After all, if you need an item, why not get it for less money?

One way to do this is via online shopping portals. If you have never utilized these sites before, you could have missed out on bonus cash for your online purchases. By beginning at one of these portals, rather than going directly to a merchant’s website, you could earn an added bonus when shopping at select stores. This could be as low as 1%, but we’ve seen examples of 10% or even more — especially around the holidays.

Another option is to utilize subscription options for those household staples you need on a regular basis. Many online retailers offer a discount if you sign up for recurring shipments of select items. Again, if these are things you need to order anyway, it makes sense to save on them — though be sure to cancel (or postpone) future unwanted deliveries before they ship.

Once you’ve pursued these money-saving avenues, you could take those savings and funnel them right into that high-yield savings account — thus earmarking them for your trip.

Choose a credit card that gives you more

There are many great options out there for credit cards with cash-back rewards or with limited-time welcome bonuses. Some travelers may want to add one of these new cards to their wallets ahead of a trip. That initial bonus can be a good start to a vacation fund – then any additional earnings you get from your everyday purchases can further boost your account balance.

In addition, if your vacation will see you leave the country, be sure to look for a credit card option with no foreign transaction fees. If not, you could be adding up to 3% to every purchase you make abroad.

Finally, once you’re on the trip, be aware of Dynamic Currency Conversion (DCC) — where you’re charged in U.S. dollars instead of the local currency, generally at a much lower exchange rate.

Your next trip may be more affordable than ever. (Photo by globalmoments/Getty Images)

Bottom line

It’s exciting to think about the prospect of more normalcy in the world of travel, but saving up money for your next trip can be stressful. Fortunately, there are a number of ways to accomplish this — starting with setting a goal and a deadline and then taking steps like opening a high-yield savings account or adding a new credit card to your repertoire.

All of these items can help you feel confident as you prepare to embark on your long-awaited adventure.

Goldman Sachs Bank USA. Member FDIC.

Featured image by Getty Images/iStockphoto

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  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
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  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023
Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day
  • Intro Offer
    Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

    75,000 bonus miles
  • Annual Fee

    $395
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    740-850
    Excellent

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,400+ lounges, including Capital One Lounges and our Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023