The warm weather makes summer the best time to head to a beach destination, pool or other outdoor activity. At 8th Great Wonder we know that our goal is to keep expenses low so we can invest as much of our income as possible, building significant wealth over time. So how do we balance our desire for summer fun without sacrificing our wealth building plan?
have fun and enjoy your summer
First of all, we should never completely avoid doing things that make us happy for the sake of wealth building. Remember, money is a means to an end, not the end itself, and we build wealth for the very reason that it can be used to make us happy someday - maybe with a comfortable retirement, the freedom to travel, or the opportunity to change careers. Whatever the reason, money alone is not our goal, the goal is to have the options that money provides us. So it's ok to take that vacation, but the challenge is to do so in a fiscally responsible way to avoid impacting your long-term wealth goals. Many people lose all sense of responsibility on vacation and spend whatever they want. Vacation destinations capitalize on this and find ways to take as much from you as possible. So let's explore the best way to take a summer vacation while being responsible wealth builders.
stay closer to home
The great thing about summer is that a significant portion of the US becomes a vacation destination. For example, I live in the northeast, and while a beach vacation in February requires a long expensive flight, during the summer the entire east coast from Maine to Florida offers great vacation options. So save the $2,000 worth of family airline costs and drive somewhere far enough away to feel like you're actually vacationing, but close enough to get there by car. Live in Pennsylvania? Drive to the Jersey Shore, Long Island, NY or down to the coasts of Delaware and Maryland. Live all the way up in New Hampshire? Maine, Massachusetts and Rhode Island are full of great summer vacation destinations. Sure driving will require gas and wear and tear on the car, but there's no massive up front cost to crush your finances. So take advantage of the great weather throughout the country and stay relatively close to home.
you need a place to sleep, not a palace
It can be enticing to see fancy hotels or rental houses lining the beach with granite countertops and
fancy bathrooms. That's great, but you're not going there for the kitchen countertop or the fancy toilet. For this week, a normal toilet will do just fine. You're there for the outdoor fun. Find a place to stay that has nice clean rooms with only the space you and your family NEED and avoid seeking out luxury on vacation. Don't forget, you can't take those kitchens and bathrooms with you but they keep your money forever. Saving $150 per night for 7 nights is $1,050. Personally, I choose to spend on practical things rather than luxury items. I might pay more for a hotel closer to the beach so we can walk instead of drive. Or maybe a little extra for a place with a continental breakfast so we don't need to find food that's likely to be overpriced every morning. Which brings us to the next item.....
pretend you're home for breakfast and lunch, then party at dinner
Meals are another time we need to remind ourselves that we're at our vacation spot for the fun activities and not use it as a reason to give ourselves high blood pressure and credit card debt. The food costs of a
week long vacation can be substantial, especially for families. The health cost is even greater as food prepared at restaurants is usually very unhealthy - even the "healthy" menu options. My recommendation is to eat breakfast and if possible lunch, like you're at home. If the place you're staying has any sort of small refrigerator you can buy a carton of milk and a box of cereal or oatmeal for breakfast. Similarly for lunch, buy some peanut butter and jelly or other lunch option and make a sandwich. You could easily bring the food to the beach, pool or on the hike with you. If this isn't possible every day, it could be for at least a few days. If you save $40 on breakfast and another $40 for lunch (depending on the size of your family), you'll save $560 for the week.
Then, having been both frugal and health conscious earlier in the day, enjoy a nice dinner at some of the location's hotspots. After all, you're there to have fun. Still worried about the cost of food? Eliminate drinks, both alcoholic and non, from your dinner order and drink water instead. You'd be surprised how much you can save.
spoil your kids without spoiling your kids
I know it sounds like it doesn't make sense, but it does. The best option for you and your family is to spoil them with your time and presence. Put down your phone and swim, hike, bike or do whatever your family enjoys. These are the things you'll all remember someday. What you don't need to do is use vacation as a reason to buy kids useless trinkets that they'll forget about before they get home. Vacation destinations are loaded with souvenir shops that generally contain very low quality items at very high prices. Avoid the trap and save yourself $100 or more. Try the "one thing each" rule. Each kid gets to choose one thing they want as a souvenir and parents of course have the ability to over rule based on cost or uselessness. But it's not a terrible idea for a kid to get a magnet for the refrigerator or a t-shirt from their vacation. You do want them to have some sort of reminder that you actually took them there.
By making a few reasonable tweaks to this vacation plan we found a way to save between $3,500 - $4,000. I bet there are plenty of times throughout the year that you wish you had another $3,500 in your pocket. And don't forget the power of compounding, the most powerful force in the world. Saving $3,500 every summer and investing it for 30 years will yield nearly half a million dollars. With that kind of money you'll be able to vacation anywhere you want.