Not everyone gets a gap year after university.
In fact, it's really more of a British thing.
In North America most of us can't afford to head out for a year after college and the debt thus accumulated.
However, once in the job market your financial prospects improve as does the possibility of long-term travel. If you play it smart you can save for a career break and get that gap year that wasn't.
Please note: This post is a companion piece to How to Save Money for Travel. The tips in both posts are essential for getting you financially ready for your big trip. The tips in this post are simply more aggressive than those in the other post. They're about ramping up your savings strategy.
Top Tips on Saving for Career Break Travel
- Remember your student days. In the post How to Save Money for Travel I didn't recommend a lot of sacrifice. Saving money for a career break does involve sacrifice. If you've just graduated and secured a job don't be tempted to spend that extra money. Continue to live on a student's budget and salt away the remaining cash. If you've been out of the workforce for a while, remember your student days and how much fun you had on little money. Cut back and live like a student.
- Don't miss the moment for saving. Set up an automatic withdrawal schedule from your checking account to be transferred to a saving account set up specifically for travel. Schedule withdrawals to coincide with every paycheck so that you save money before you ever see it in your checking account.
- Find more money. What do you do in your spare time? Surely you have a few extra hours in the week that could go to a second job, dog-walking for a neighbor, selling a skill on Fiverr or Fivesquid, or taking on freelance work through Freelancer. Get creative. It's amazing what people will buy. And it's not just about selling your time. Sell your stuff as well. You won't need it when you're traveling so you may as well make money from it to support your travels.
- Look for places to eliminate expenses. Cancel cable. Review your cell phone plan. Meet with your banker and crunch the numbers on a premium account vs the many ways it helps you save. (I save this way.) Take your lunch to work. Plan your meals according to what's on sale at the stores. There are lots of ways to lower costs and save.
- Look for ways to earn points/dollars for travel. The whole loyalty rewards system is built into the cost of everything you buy so you may as well take advantage of them. I buy just about everything with a credit card that earns me points. And I double dip when possible to get more points. For me, in Canada, I especially like earning Aeroplan and Air Miles points. Read: Deciding on the Right Travel Rewards Credit Card
- Spend time rather than money. Look at all your expenses and consider them on an either/or basis. Either you spend money for them or you spend time. If at all possible spend time. Get rid of your car and take transit – that will amount to a huge savings. Drop transit and ride a bike. Cook food from scratch rather than buying prepared foods. Shop grocery specials at a couple of stores rather than buying everything at one. There are many ways that spending a little more time could save you significant money.
- Re-think your leisure activities. Potluck dinners, hiking with friends, game nights, badminton at a recreation center rather than racquetball or squash, free books at the library… there are hundreds of ways to have fun for next to nothing.
- Pay off debt first. Ok, to be realistic pay off credit card debt or any debt that doesn't by nature have a long life such as a mortgage. Why spend on interest when you can be spending on travel?
- Reduce your rent. Take a roommate or, gulp, move back home with your parents. I know! It's a sacrifice but consider the short-term pain for career break travel gain. After all, you are saving for the trip of your lifetime.
- Plan as you save. This is not an aggressive tactic but one that will make the daily sacrifice a little more palatable. Plan your trip as you save money for it to keep your motivation high.
You can only spend a dollar once. This may sound ridiculously simple but I frequently see people overestimate their spending ability – as if they can spend the same dollar more than once. Make this phrase your mantra and you'll keep on track to saving for your career break and replacing that gap year that got away.
I write about travel and money every Tuesday. There are dozens of posts in our Travel Money Tuesday series to help you save money for and as you travel. Check them out.
See you next Tuesday,