Broker Check


| July 02, 2018 |

A plethora of online resources will direct you to world famous destinations or hidden gem locales- all while highlighting the best prices and budget-friendly deals.  When we can finally indulge in a much-needed vacation, our minds are usually made before we even long online to research, what location we want to be in, the hot hotels in the area, where we want to eat and what time of the year we want to go. If you’re anything like this fiscally tight gentleman, not only is your mind ringing with cashiers bells, but your eyes light up with dollar signs!  It can feel like the expenses and unknowns are adding up quicker than the extra socks in our luggage. This can make saving money on the trip that much more difficult, especially if you’re planning on bone-fishing in the Bahamas during Christmas.

Having an established, allocated “trip” fund is the first step towards saving money while on your next vacation. There are several options proven much more lucrative than the traditional taboo of putting it all on credit cards or taking out a small, yet ultimately detrimental loan; out of sight certainly does not mean out of mind - or wallet. For example, should you decide to pay for the trip with cash, then pay yourself back (with interest) over time, you’re not only saving in the short term but have managed to earn a small profit while sipping your Pina Coladas poolside. You can accumulate valuable redeemable points by using your credit card, all the while planning to pay off the new charges upon your return, avoiding excessive interest charges. Use a conservative loan directly from your investment account, so your money can stay working while you pay yourself back, your feet up on vacation mode. Developing and maintaining proper savings habits as early as possible are key strategies we encourage all of our clients to work on. In our personal and professional experience, we have found that means depositing at least 15-20% of your income annually into a savings account. While this percentage may come as a shock and seem on the excessive side, but we have found that for many of our clients, their dynamic family lifestyles may lead to what we call, “unpredictable financial security.”Meaning: the future is ever changing when you have teenagers getting behind the wheel of their first car; planning to head off to college - or maybe for some head downstairs to the basement ensuite while following their artistic pursuits. Whatever the unpredictable future might bring, there should always be one element you can count on; you can control; utterly predictable: your savings.

Access to liquid assets is another big topic of discussion with our clients. Employer-sponsored 401k plans are a great tool to help save for retirement, but they may not be the best choice when it comes to fixing a broken appliance in your home or taking the family to Disneyland.  It’s always important to build diversified liquidity within your savings account, cash value in a life insurance policy or investments held in a brokerage account. Cash value in a life insurance policy and investment accounts can help you build up assets that can be converted into cash to help pay for any financial needs. Take a look at your current asset liquidity and explore those alternatives before committing to maxing out your retirement plan, especially on what we would consider immediate, short-term problems. We have all experienced that heart racing feeling when your stomach twists and turns, palms become clammy when an unexpected event or accident arises and we are charged with making those quick, split-second decisions. Knowing that in those hectic moments you have choices that won't change your future retirement plans should put those twists and turns quickly at ease.

The efforts of your hard earned, well thought out savings and diversified liquid assets can help afford new, expanded options and possibilities when searching for your next memory making a vacation or unforgettable trip. The alternatives to educated savings and spending can unfortunately and ultimately be devastating towards building your overall wealth and success;( ) & ( ). We all want to try our best to avoid being lumped in with the more significant percentage of Americans that will and have put themselves - along with their families- deeper into debt, all in the pursuit of a little relaxation and a lot of quality time together away from screens and phones.

Budgets vary from family to family and person to person depending on age, income, and how much they (or their significant others) are spending on average. It can also depend on the importance or rarity of this vacation. Will this be the one big shebang of the year, or maybe the first of several camping trips you’ve planned? The important things to take away from all of this are setting a budget, sticking to it and starting to contribute to your trip “fund” as early as possible at the same time. And again, we can't stress the importance of developing and maintaining both your savings and liquid accounts to help create an overall more comfortable, stronger, diversified budgeting strategy while acknowledging that your 401k is just for that: retirement.

Tips for helping your budget go further

KEY GOAL: Shop around/compare the best flight/hotel prices and stick to that budget!

  • Stick to your budget: sit down and create a budget before getting to your final destination and do your best to follow that budget; you’ll be thankful in the long run, and a few minutes of research can end up saving you hundreds!
  • Don’t max the budget before you get there: while we can all appreciate getting a good night's rest, make sure not to splurge too much on places you won't be spending the most time.
    • If you’re close to the top of your budget with just the flight and hotel, you may want to reconsider. Having to pinch every penny while at your destination can ruin a trip or cause you to go over your budget by quite a bit. Memories can't be replaced, just like that extra cash in your savings account!
  • Check multiple travel sites: going with the first deal you find may not be the best choice - don't get fooled by ads hiding as discount websites. Make sure to price-check multiple sources and if they are able, set up notifications for any price changes or comparable options found.
    • Don't just pull up the first travel site that pops up on google. Use sites that compare multiple options (trivago, etc.)
  • Create a watch list on the hopper (app) for changes in flight price: you can’t be everywhere all the time, and despite our best wishes we don't all have eyes on the back of our heads. Setting notifications or alerts will allow you to go about your day without missing any changes in price, the best times to buy versus when to hold off, or the latest deals.
    • Hopper also allows you to add your destination on a watch list months in advance, notifying you of the best time to make flight and hotel purchases. Hopper which happens to be our favorite app right now, however, there are tons of others related to travel that will also notify you of cheap flights or excellent bundle deals.
  • Use the airline’s/hotel’s website: sometimes they keep the best deals for themselves: while you may think the discount websites have the best deals, in actuality, some companies hold the best deals for their sites and sales events - so don't forget them too!
    • Check the airline's website for booking, and often they have the cheapest flights available. Travel sites can often put you on a plane with restrictions or without a seat chosen (middle seat...brutal).
      • Don't be afraid to call the hotel directly and ask for any discount/upgrades they can offer. Hey - it can’t hurt, right? And we’ve found through personal experience that you can obtain deals this way - and some great ones!
      • There have also been trends that indicate midweek travel is often cheaper when compared to weekend travel - so if you can book your vacation weeks Wed-Wed for example rather than Sat-Sat, you could wind up saving again.
  • Instagram Accounts: it may sound off, but loads of different Instagram accounts were designed to individually post travel deals/discounts related to your hometown or city. Search Instagram for accounts that post cheap flights out of your hometown.
    • For trips out of SLC use @flightsfromhome or @flightsmachine.slc. Your destination may pop up when you need it.
  • Location (near town, restaurants, etc.): we cannot stress it enough. Plan, plan, plan, and then plan some more! The more prepared and aware you are of your surroundings and what’s available and where ahead of time will not only save money but will cut down on needless time spent. Cab ride? Rent a car, etc.
    • Consider this; you may be able to save a few dollars by booking a hotel several miles away from where you want to be adventuring or exploring, relaxing or reading. Although you may end up paying for some amenities that the more expensive options have provided complimentary (pool/beach access, etc.) out of pocket, overall it still adds up to help you save when the price of rooms can be upwards of half the cost!
      • It can also help you submerge into the local culture and learn life-long lessons from your new neighbors.
  • Airbnb/VRBO: both of these companies offer some incredible savings on genuinely unique, top-quality vacation rentals. There are so many different sizes, layouts, and even crazy decor schemes to pick from that these rentals will become the main highlight of your trip!
    • Check if there are vacation rental options near your desired location. Can be great for large groups or families to split the cost. People who like to cook/eat in, save money on dinners/eating out.
      • And once again, seasonal planning may need to be accounted for - if you try and book an Airbnb in New Orleans during Mardi Gras, you're going to be paying a premium compared to “off-season.”  

After the trip:

  • Take time to sit down and evaluate yourselves; what could be improved on for your next trip?
  • How much overall would you say you saved? Did it feel restricted or did you budget enough to fully indulge?
    • And most importantly, who do you need to pay back and when? This vacation should stand as a marking point in your future travel plans; no one gets their first try right (those of us that are not professionals), and these tips and tools stand as great reminders to always keep educating yourself and growing your savings; retirement; stability.
    • How did you finance the trip? Credit card, cash from savings, borrow from investment/whole life policy?
      • Any option or a mix of options you ended up using to pay for your trip needs to be addressed when you return home from your trip. Even if you used cash from your savings, you still need to pay yourself back.
      • Credit cards would come with the highest interest rate if your game plan were to build up points and pay off your debt once you return home, don’t forget to do it! And don't put it off to incur other expenses. Credit card debt can be damaging to your wealth building potential. Don’t dig a hole you can't get yourself out of, pay off your credit cards in full each month, don't let their high-interest rates pile up on you.
      • Loans from your investment account or whole life policy will have a more favorable interest rate than your credit card, but they still need to be paid off! The idea of using the funds inside your investment account of life insurance policy may sound enticing but is counter intuitive to your original plan. Come up with a payment plan to get your debt paid off over the next several months, and let the money in the account do as you planned, grow!

If any of these ideas or tips sound interesting to you, but you're unsure of how to put it into action, don't hesitate to schedule a time to meet with us using the link in our navigation bar.