Here in Texas,summer is in full swing with heat and humidity. And if your family is like mine, you’re on vacation countdown.
In theory, vacations should be all about relaxation and fun. However, without some planning and preparation, that fun can morph quickly into stress. As I write this post, I’m having flashbacks of dragging my complaining 13-year-old son through Europe … but that’s a different story.
There are plenty of travel hacks out there, but here are a few finance-related tips to facilitate a lifetime of memorable — in a positive way — vacations.
Save for your trip. I wrote about “saving for fun” a few months ago. It’s hard to beat a fully funded vacation. Over the years, my wife repeatedly has rejected my pleas for a river cruise. Every time I showed her the cool marketing brochures, her response was, “Honey, look how old everyone is.” That changed last year when she finally agreed to a 2019 river cruise. As soon as I rallied a travel group of three other “age-appropriate” couples, we started to sock money away. Today, one of our savings accounts is nicknamed “River Cruise 2019.” Whether you’re planning for a short road trip or your trip-of-a-lifetime, start saving today.
Exchange efficiently. If you’re traveling overseas, currency exchange can be a little intimidating. I like numbers, but trying to make heads or tails of the exchange-rate boards and the unintelligible explanations from the guy behind the counter has left me frazzled more than once. In recent years, currency exchange has gotten simpler and less expensive: Use the local ATM. You get a good exchange rate and little to no hassle. If someone asks you, “Would you like me to process your transaction in dollars?” don’t say yes. Instead, let them process it in local currency. The banking system will get it figured out without taking you to the wood shed.
Watch for transaction fees. Getting a good exchange rate is great, but if you’re paying a foreign transaction fee of 1−3% with your debit or credit card on each transaction, you’re losing ground. There are plenty of card options without foreign transaction fees, so find one of those, and use it on your next trip.
Consider insurance. After watching a friend’s changing work schedule derail his family’s expensive vacation a few years ago, I became a fan of travel insurance. Military life has been known to deliver more than a few curve balls, so it’s at least worth checking out. Policies vary but can offer protection based on illness, work and weather issues — and many include medical protection in case one of your family members is injured while you’re traveling. USAA offers a program with member pricing through a strategic partnership; search “travel insurance” on usaa.com to learn more.
Take advantage of the military deal. Whether you opt to travel Space-A; take advantage of military discounts available through cruise lines or through your local Morale Welfare Recreation office; or stay at a military resort or lodging booked through an organization like Armed Forces Vacation Club, your military service can help ease the financial burden of taking some time off.
Get your affairs in order. NOW is the best time to ensure your wills, powers of attorney and other key documents are squared away, but sometimes a vacation becomes the triggering event for you to get it done.
One final tip: Drink lots of water on the plane. I’d share my experience that led to this sage advice, but let me just say day one of the vacation failed to live up to expectations.
JJ Montanaro is a Certified Financial Planner professional with USAA’s Military Advocacy Group