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7/19/2019

How to Save Money for Travel

Are the sand and surf calling your name? Or perhaps the big city lights are more your style. No matter what kind of getaway you’ve been dreaming about, you deserve to unwind on your vacation without a care in the world - including your finances.

CIT Bank’s annual Summer Savings Survey conducted by The Harris Poll found that vacations are high on the list of non-essential spending, increasing 88% from 2018 to 2019.1 However, more than one in three consumers don’t save for their vacations and turn to credit cards, packing on debt before they even pack their luggage.

The best strategy for having a financially stress-free vacation is to have the expenses covered by your savings before you ever take off. Here are six steps you can take to amp up your travel savings.

Set your vacation savings goal

The first step is to estimate the total cost of your vacation. Research your anticipated expenses including transportation, travel insurance, lodging, activities, souvenirs, etc. Add up the costs to establish a ballpark vacation budget.

How much should you save every month for your vacation? Take the total amount and divide it by the number of months you have until you want to travel. This should be your goal.

For example, if your trip to the Bahamas will cost $5,000 and you want to start your fun in the sun six months from now, you’ll need to save approximately $833 every month. The longer the timeframe, the more time you’ll have to build your vacation fund.

Start a dedicated travel account

Setting up a savings account earmarked solely for your getaway goal is a smart tactic. That way your vacation savings will remain untouched if your car needs new tires or it’s time for a new dishwasher.

Earn more by choosing the right savings account

Choose a high-yield savings account, such as the CIT Bank Savings Builder account, which offers higher interest rates than most traditional banks. With Savings Builder, you can earn the top-tier interest rate by making at least one deposit of $100 or more each month or maintaining a minimum balance of $25,000.

Put your travel savings on autopilot

Set up automatic transfers from your checking account or paycheck to your travel fund. A savings account calculator can show you how even small weekly or monthly deposits to your savings account can add up over time.

Keep adding to your travel savings account

Supplement your automatic transfer deposits by feeding other money into your travel savings account. Received a bonus at work? Earned extra cash from a side gig? Stash the money in your travel savings account.

Stay focused on your dream

With a little planning, building up your travel savings over time can lead to a financially stress-free vacation and memories to last a lifetime.

Happy travels!

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