According to a survey by Hotwire, one-third of millennials plan to travel in 2015, and the millennial generation has set aside a whopping $226 billion dollars to do so. There’s something about us millennials, we love to travel. Do you think it’s because we are restless and always on the move? Whatever the reason is, we are planning on spending a ton of money to “go places” this year, and most of us plan to use those dollars for end-of-the-year holiday travel. But you’re probably just like me and would rather travel more and spend less, right? The question is, how do you save tons traveling during the holidays?
As much as I’d like to take credit for coming up with some genius ways to save money when traveling, I simply can’t. There aren’t any top-secret secrets that I have, except that what I’ve learned over the years has been from trial and error, and believing that there is always a way to do what I love and spend less money. That doesn’t mean I’m cheap, or that I don’t like to stay at luxury hotels. No, no, don’t get me wrong. I love to fancy hotels, great beds, and those fluffy robes just like you do.
What I’ve got for you is travel tips for this holiday season that will ensure that no matter what your budget is, you can afford to travel in what I call, “affordable luxury.” Even if your dream is to stay in an Airbnb rental in Berlin and live like a local, so you shall, and these tips will help you get the best bang for your buck.
Hop over to Millennial Money on iTunes for the podcast on this topic!
The Travel Budget
Creating a different travel budget is essential to make sure you stay on track. I can’t tell you how many people I’ve asked, “Hey, how much did you spend on that trip last year,” only to hear they say, “Um, I have no idea.” What?! How can you have NO IDEA? That is how we ruin budgets and find that lovely friend stress knocking on our door. I promise you, with a travel budget in hand your trip won’t be without a few, “oops, I didn’t budget for that,” mishaps, but it will give you a roadmap for your spending so you can travel in peace. Here’s what you’ve gotta do:
- Outline all your expenses so you know how much you will need to save up. Once you have that amount, divide it by the months you have left to save, or even by the days left, to figure out how much you need to save.
- End of the year bonuses can be a great way to supercharge your savings. Remember, you can always negotiate for a higher bonus if you’ve done a great job that year.
- Always pad budget by 20-30% for unexpected costs. This is a must have in each and every travel budget. You will thank yourself later when you have extra money left over. (Hint, slide that right into your savings for your next trip.)
- Remember there is always an exchange rate if you are traveling to another country. The best tip is to use a credit card that doesn’t charge for exchange fees, like the Chase Sapphire Preferred Card.
- Shop your closet before you go shopping for a new travel wardrobe. If you’ve got to spend some cash for your trip, sign up for online deals with your favorite stores to save (aka, buying at full price can be a slow death for your budget.)
Rock Your Points
I’m a huge fan of credit card points. Yes, I know you can get into a lot of trouble with credit cards, and I have in the past. However, if you use your points wisely they can be a HUGE bonus for you. Here’s the secret: use points for airfare, not hotel stays. Most credit cards offer you the option to change your points into either dollars (cash-back), transfer to partner airlines or book through their membership rewards site. Chase, for instance, offers you a bonus if you book through their membership site, so it’s always worth a glance. What I’ve found is that hotels usually require a lot of points, for very few nights, and the exchange just isn’t worth it. Instead, use your points for the airfare, because nowadays it can be worth upwards of $1,000 plus. Here’s what you need to know:
- The Best cards
- Chase Sapphire Preferred– transfer to airlines, get cash back or get 10% bonus if you book through their rewards. This is a solid card, in fact, I have one and we use it often.
- Capital One Venture– also a great card for rewards and points.
- Stash Card– If you like to stay at boutique hotels, but want to be able to use points, check out the Stash Card. According to Stash, the Stash Hotel Rewards will be launching the Stash Hotel Rewards® Visa Signature® Card, the only hotel loyalty credit card that awards double points when you stay at ANY hotel. For the first time, a rewards credit card will allow consumers to earn loyalty points at hotel chain properties (i.e. Marriott, Hilton, Hyatt, etc.) and redeem them at authentic, one-of-a-kind independent hotels (i.e. The Essex Resort & Spa in Vermont). The card also rewards travelers for their everyday spend – particularly those expenses that are related to their travel – like gas and eating out.
- Keep your credit top-notch. If you have to make charges during holidays to your credit card that you can’t pay off immediately, come up with a 1-3 month payoff schedule and stick to it to keep interest at a min. Or, look into doing a balance transfer to a 0% credit card, and then pay it off ASAP!
- Make sure you set up auto-pay on cards if you will be traveling so that you never miss the payment due dates.
Work the Off Days
Trying to find the “ideal” day to travel on can be a bit confusing. Some places will tell you it’s a Wednesday, some a Tuesday, some say any day but Friday. What I’ve found is that you’ve got to really do your research and legwork on this one. Check a combination of days and check it at different times of the day. So, if I wanted to travel ideally on a Thursday through a Monday, I might check Wednesday through Sunday, or Friday through Tuesday. Then, the second half of this is to check those options at different times during the day. Normally, if you check airline prices first thing in the morning, or really late at night, you usually will get the best prices. Here are some rules:
- Always stay over a Sat if possible. This helps to keep air prices lower.
- Best days to fly are usually Tues, and Wed, and return on Mon-Wed. The one exception is around holiday time. In this case, you usually get the best prices if you are willing to travel on the holiday day – so Christmas Day, New Year’s Day and Thanksgiving.
- Book at least 21 days in advance – ALWAYS.
- Use Kayak or other sites, and check on actual air carrier sites as well. Sometimes there is a big difference in price. Oh, and I always set up fare alerts on Kayak so I can be alerted if my airfare drops to a level that I want to buy it at. This is good if you have a few months before you want to travel.
- See about flying into an alternative airport. For example, for Los Angeles, sometimes I can fly into John Wayne, or Burbank airports and get a lower price. Or, I might even check San Diego or San Francisco and then book another flight into LAX. If the alternate airport is within driving distance, it’s worth checking on.
- Rent your car off airport property – take Uber if you can or a taxi to the rental location. This can save you 25%+ on the price of renting a car, and most times you can find a rental car lot within a few miles of the airport.
- If you have a Costco card, check in their travel section for rental car prices. Also, alumni associations sometimes offer good deals. The point is to take a few minutes to check around because you know my motto, “extra money is extra money, and that’s the name of the game.”
If you want to save money on your hotel stays, you’ve got to become comfy with negotiating. I’ve done a whole podcast on the Art of Negotiation, so check it out. It’s not that hard to do, and really it’s just about asking a bunch of questions in the hopes of saving some money. Two of the best strategies I’ve used is to book Airbnb with short notice and to call hotels directly. For Airbnb, the closer you get to the arrival date, the more apt people are to negotiate. They want to get rid of their property. I usually pin two properties against each other (in a nice way) and have them compete for my business. Almost every time I can save 10-40% off the rate just by asking them if they are willing to lower the rate so I can stay with them over the other property. Simple. For hotels, calling them directly will usually get the best rates, BUT you need to have a rate from another source, normally an online site. So I might call and say, “Hey, I noticed this hotel is offering me $199 on Expedia, and on your site it’s listed at $229. I really want to book through you directly, can you match or beat the Expedia rate?” Works like a charm every time. Ok, here are a few extra things for you to know:
- Never pay a security deposit when using Airbnb or VRBO, or if you have to pay one to get the property you want, negotiate it to $100 or less.
- A downside to Airbnb-type properties is that you have to prepay your stay vs. a hotel where you pay when you check out.
- If you stay in a hotel, always make friends with the concierge. They are the keeper of secret deals and can get you into the best restaurants and attractions. Ask if there are any discounts or exclusive offers you should know about. The key is to always ASK.
Be Brave, Go Off the Beaten Path
If you want a getaway that is unique and affordable, find places that are off the beaten path. Now, this doesn’t mean that they are dingy and gross. Oh no, my friends. It means that they are where all the cool kids are going while everyone else is getting on a plane to Cancun or Florida (not that those places are bad). You can score some amazing deals at up and coming places around the world and truly have a memorable experience. Here are some places on the top of my list:
- If you want Caribbean, think Dominican Republic, Costa Rica, Curacao. These are all amazing destinations that offer a ton of deals. You can see some of the most amazing beaches and have some great adventures.
- If you want Europe, think Germany, Ireland, and Greece. Germany is the new millennial capital of the world, and places like Berlin have some out-of-this-world boutique hotels for a fraction of the price you would pay in the states. The food is amazing and the people are welcoming. Ireland and Greece, both who’ve had economic downturns, are amazing steals given the low price of the Euro and inexpensive hotels. Your dollars will go a long way here.
- Don’t just do an all-inclusive because you think it’s cheaper. Sometimes it is, and sometimes it isn’t. Instead, price out two options and see what works better for your wallet. If you aren’t a huge drinker, you will often overpay with an all-inclusive because drinks are a major part of the price.
- Always check out package deals on Groupon Getaways, Jettsetter, Secret Escapes, and Vacationist.
There you have it. Some great ways to save on travel for the holidays, and all year round actually. This is how I travel and save a ton of money. I still get to go to some amazing places, in fact, I might argue that I get to more amazing places because I’m smarter with how I’m spending my travel dollars.
What about you? Have any great tips to share?
Disclosure: The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which financial products may be appropriate for you, consult your financial adviser prior to investing and selecting a financial product. There is no assurance that the techniques and strategies discussed are suitable for all investors or will yield positive outcomes.
Shannah Compton Game is a Money Wellness expert, host of the to-rated Millennial Money podcast, and CERTIFIED FINANCIAL PLANNER with an MBA. Millennial Money has over 15 million downloads in 164 countries. Shannah’s years of experience as a skilled Certified Financial Planner have set her on a mission to revolutionize how people think, act, and feel about their finances…and have some fun doing so.