Being able to travel is a wonderful experience.  Not only does it give you the opportunity to learn about and appreciate other people, cultures and experiences, but there are also studies that suggest that travel has mental health benefits as well.  Unfortunately, being able to afford travel seems to be an elusive thing for far too many people.  I realize that everyone’s priorities and financial responsibilities aren’t the same.  But if you find yourself having trouble finding extra cash in your account to put towards travel, I have some suggestions for how you can re-structure your finances and make it easier to travel more often.

Create Multiple Bank Accounts

Sticking to a budget is difficult, no matter how lenient you are.  Managing all your purchases from the same bank account can make it difficult to stick your budget, regardless of how detailed your budget is.  I find that creating a separate account for your different priorities makes managing your finances a little easier.

Create an account for your fixed monthly payments

If you can, contact your employer to arrange for your direct deposit to be broken up into multiple accounts.  Do an estimate of your monthly bills (give yourself some wiggle room), break that into however many pay periods you have per month, and have that amount direct deposited into an account specifically for bills.  Set up autopay so that you don’t have to worry about managing your bills every month.

Come up with a savings goal

After your bills are paid, you need to make sure you have a solid savings account.  Obviously the amount you should save depends on your income and your financial responsibilities, but you need to put money aside for unexpected expenses (or potential unemployment).  After your first direct deposit into your fixed payment account, you should create a separate account for your savings.

Not only does having a savings cushion take tons of stress off your shoulders by ensuring that you don’t have to scramble every time some unexpected expense presents itself, but its easier to save money when you can pay cash up front for things, instead of paying as you go.  For example, car and home insurance are cheaper when you pay the premium in full instead of month-to-month.  Buying products like soap, toilet paper and cleaning supplies are cheaper when you buy them in bulk, instead of buying one at a time.  Is there ever a time where you won’t need any of those things??  Probably not.  So you might as well buy big portions of them instead of paying way more per unit, just to save money on your purchase in the short term.

Checking

Once your fixed payments and your savings have been taken care of, the remainder of your paycheck should go into your primary checking account.  Whatever is in this account, is yours to spend.  This makes it clear what you have to spend, so you don’t find yourself in the Starbucks checkout line trying to crunch numbers to see if you have enough in your budget to get that Venti Pumpkin Spice Latte.

Clean up your credit

It’s expensive to go through life with bad credit.  It makes it harder to gain access to capital, whether for a mortgage, home loan, or other loan.  The capital you do have access to comes with a much higher interest rate, which means you end up paying far more for the same product for the life of the debt.  Not to mention that bad credit can affect your cell phone and insurance rates, and sometimes it can even affect your employment!

Once you’ve figured out how much your fixed costs and savings goals are, you should work on paying your debts down, specifically your consumer debt.  Consumer debt generally comes with super high interest rates, and is essentially just throwing away money for products or services that you probably don’t even use anymore!

Identify your needs vs your wants, and prioritize them!

A big reason people find themselves in situations where they have to choose between doing things they would like to do (like travel) vs what they have to do (like pay credit card debt) is that they have a hard time differentiating between their needs and wants.  And when I say needs, I don’t even just mean things like food, water and shelter!   When I say needs, I include the things you need to be happy.  For me, that is good food, wine, and travel.  Its also important to me to be comfortable in my home.  It doesn’t have to big or fancy, but definitely something that is clean, modern and free of clutter.  Those are things that I’d be miserable without, so obviously those are the biggest consumers of my money.

There are obviously times when I see things I like, but don’t necessarily need to make myself happy.  For me, things like clothes, cars, and partying are things that are nice to have, but are not necessary for my happiness.  I will occasionally spend money on these things, but they will never come at the expense of my core needs.

Try to identify your needs vs your wants.  When you get the urge to buy something, be honest with yourself about why you’re buying it.  Will your happiness with this purchase last beyond the first time you use it?  Are you buying it just to be able to post a picture of it on Instagram?  Or will it be something you’ll be able to draw happiness from for an extended amount of time?  Will this purchase affect your quality of life for a while?  You don’t want to find yourself eating Top Ramen until your next paycheck or delaying your savings goals in exchange for the purchase of something that’s not a necessity (even travel!).

Save money where you can

Try not to pay full price for anything if you don’t have to.  Shop around!  If you’re shopping online, make sure you search RetailMeNot to see if they have any coupons.  Online stores will offer you a 10-40% first time customer discount if you sign up for their promotional emails.  If you have a credit card with cash back or travel benefits, make sure you’ve checked to see if you can get cash or miles for your purchase.  Don’t forget to sign up for Ebates!  You can get cashback on purchases by using their links to access your favorite online stores.  And last, you can always check out my previous post, 5 Ways to Travel on a Budget.