If you are reading this site I would think a love of travel is something you more then likely already possess.
Ok… so we covered that base. Now that we know we all love to travel here, how can we balance a lifetime of mixing travel with financial intelligence without ruining our future retirement?
What do I mean by financial intelligence?
Quite simply, traveling smart without living above our means. That is why I am a big advocate of traveling frugal, and living like the locals when traveling. Not only will it be a more authentic experience, it does not have to break the bank.
What is Living Above Our Means?
If we are spending every dollar and then some, then we are living above our means. No matter how much money you save while you are traveling if you are spending more money then you make, then you are not traveling smart…. This means both our at home expenses and our travel expenses.
For instance, if our household income = $5,000 a month but we were to spend $5,000 a month or more a month we need to cut costs immediately! Doing this is a pre-requisite before we can travel more.
Let’s expand on the above illustration of a family that makes $5,000 a month.
Most financial experts will tell you to save at least 15 – 20% of your income. So for a family making $5,000 a month that would be roughly $750 – $1000 a month.
So after you save $750 – $1000 a month, then you can figure out what is left in your budget for travel.
Say you have $1,000 left after you save 15-20% of your income. You can then use whatever amount of the $1,000 left to add to your travel budget.
If you decide to use the full $1,000 for travel, then you have a budget of $12,000 a year for travel. That is enough for some SERIOUS travel!!! After reading around on my site, you will see $12,000 can go really far! Especially if you follow my tips 🙂
The amount of money or percentage of your income you want to budget for travel is completely up to you once you have the necessities taken care of.
Before You Go Traveling the World, Consider These Things Too!
Once you read the article, you should find a lot of your “necessary expenses” weren’t really necessary after all!
The other thing we need to carefully consider before traveling frequently is whether we are in debt. If we have major debt, traveling frequently is probably not a wise or necessary expense. If it were me, I would work my absolute hardest to remove unnecessary debt before engaging in a life of travel. After all, we are going to be traveling for the rest of our lives, right? 🙂 Cut the debt first, and then we can have ALL the freedom and flexibility we need without the heartache and stress.
What expenses are holding you back? Are you a gadget spender? Do you like to spend all your money on gadgets and gizmos? Do you spend a lot of money on luxury items? If you don’t love these ‘THINGS’ more then traveling, then limit them the best you can. That way you can save more money, or add it to your travel budget.
One thing that is good to keep in mind is in other countries, especially Southwest Asia, Caribbean Countries and even Eastern Europe we can get by on as little as $800 – $1,000 a month per person including everything!
Why am I telling you that? Well sometimes it can make more financial sense to live in other lands! If that is the case, then consider all the surrounding circumstances…
Will you be able to make any income when in another land? If your not sure, do some research and figure out if you have a skill that can make you money elsewhere.
If you can make some money, figure out if your net profit (income minus expenses) each month is greater or less then your net profit if you were still home. If it is, you might be on to something!
Being a smart traveler is one thing, but balancing a life full of travel without affecting your future is where it gets a little tricky. Following these tips in addition to a reading of my blog will enable you to travel smart, and travel cheap without neglecting financial intelligence.
In the comments below, share your favorite tips to be able to travel frequently without sacrificing your financial future. It could help all of us out, including me.