How To Set A Travel Budget In Retirement.

Think through priorities and costs as you plan trips during your golden years.

Scheduling a trip during the off season or the shoulder season can lead to savings. (GETTY IMAGES)

 By Rachel Hartman

This article was originally published by US News & World Report.

THE LURE OF TRAVEL CAN be strong for retirees who now have time for extended trips. From visiting family and former classmates to trotting the globe and soaking in historical sites, the options are nearly endless.

Before mapping out your trip schedule, taking a close look at costs is essential. “The travel budget needs to be set as part of your overall financial plan,” says Patti Black, a certified financial planner and partner at Bridgeworth LLC, in Birmingham, Alabama. Here are strategies to help you plan for travel on a budget and make your dollars go further in retirement.

[See: The Top Travel Destinations for Retirees.]

Start with the big picture. Before making travel plans, look at your retirement income. You might have cash coming in from various sources, such as retirement account distributions, investment proceeds, properties you own and rent out and Social Security. Calculate your total annual income, and then look at the expenses you can’t avoid during retirement. These might include costs for housing, health insurance, food and vehicle maintenance. Subtract those set expenses from the overall income. “Then determine how much of that total amount you want to spend on travel,” Black says. Perhaps your retirement income for the coming year will be $50,000. If you have $10,000 to spend after paying for the essentials, you might decide to put $5,000 toward travel.

Think through places. If there are several states or countries you’re hoping to explore, it can be helpful to write down a list. If you have the travel bug but don’t know where to go, start by researching destinations online. Talk to others in retirement who have taken trips and ask for recommendations.

In addition to touring new places, you might want to visit children or grandchildren who don’t live in your area. Look at upcoming graduations, weddings, reunions and other special events you will want to attend in the coming year that will require travel.

[Read: 15 Travel Themes to Explore in Retirement.]

Estimate the total cost. Once you have an idea of where you want to go, start checking on prices. For places you haven’t visited before, plan out as many details as you can to get a good feel for costs. “Think through what you want to do every day of your trip,” says Patricia Hajifotiou, owner of The Olive Odysseys, a tour company in Greece. “Write it down, and then right beside that, write what that is going to cost.” The process will help you avoid overlooking daily expenses, such as a taxi ride to the airport or tickets for an art museum.

For cruises and tour packages, ask others who have been on similar trips about their experience. You may learn they paid a bit or a lot more than the initial trip fare. A lower-priced river cruise in Europe, for instance, might have so many excursions with extra costs that it could end up being significantly more expensive than a higher-priced Caribbean cruise.

Set up timelines. Knowing what you can afford to put toward travel each year, along with an estimated cost of trips, will enable you to start planning. You might find some trips have to wait for another year, or that you want to put some of your income from several years toward a dream trip. “Everyone’s situation, assets, priorities and goals are different,” says Lou Cannataro, a partner at Cannataro Park Avenue Financial in New York City. You might reduce certain costs in your financial plan to travel more, such as moving to a smaller house, selling a vehicle or eating out less.

Maximize every travel dollar. With the advantages of time and flexibility in retirement, you may be able to reduce the overall cost of each trip. Scheduling a trip during the off season or the shoulder season, which is the time just between the peak and low periods, can lead to savings. Watch online for airline deals to find the best prices. “Consider drawing out trips and traveling slower,” says Joseph Conroy, a certified financial planner and financial consultant at Synergy Financial Group in Towson, Maryland. “Take more time in each city and try to live like a local.” You’ll save on food costs and might be able to reduce the price of lodging. Also, try combining long trips to save on airfare. Instead of traveling to Italy one year and Portugal the next, go to both places in one trip.

[Read: 25 Things to Do When You Retire.]

Understand that preferences change. You may start retirement with a list of destinations to visit, but keep in mind that as the years go by, you might choose to see other spots or lose interest in certain trips. “The travel budget changes over time,” Black says. Some years you may want to travel more than planned, and other years you might opt to stay home to be close to an aging relative. Your own health may fluctuate and cause a shift in the type of travel you want. Rather than a long trek through Asia, you might find an Alaskan cruise more relaxing and easier to maneuver.

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