Skip to content

How to Fit Vacations into Your Financial Planning

woman in pool on vacation

Yes, you should take that vacation! Here are a few considerations for figuring out your next trip and integrating it into your financial planning.

Author: Martin Lundgren

When you’re focused on building the life you desire, it’s easy to get caught up in the hustle and bustle of work without stepping back to enjoy the fruits of your labor. However, neglecting vacations can lead to burnout and hinder your overall well-being. In this blog, we’ll explore why you should prioritize vacations and how to fit into your financial planning. We will also cover a few unique trip ideas and discuss practical ways to save for your next adventure. 

Why Vacations Matter

Contrary to popular belief, vacations aren’t just a luxury; they’re necessary for maintaining mental and physical health. High earners and tech employees often find themselves buried in work, facing immense pressure and stress. Taking regular breaks through vacations allows you to recharge, boost productivity, and foster creativity. Moreover, vacations offer invaluable opportunities for personal growth, cultural immersion, and creating lasting memories with loved ones.

Tips for Setting Up a Vacation Fund

Consider setting up a dedicated vacation fund to ensure you prioritize vacations in your financial planning. This could involve allocating a specific amount annually, such as $20,000, towards your travel adventures. Creating a “fun” account, perhaps in a high-yield savings account that lets you set money aside for the holidays and earn interest on your savings, can help you pre-fund your vacations systematically. Discussing this strategy with your financial advisor enables you to integrate it seamlessly into your budget, making planning and executing your trips less stressful. This approach, known as goals-based bucketing, ensures that the funds are already waiting for you when you’re ready to jet off.

Tricks to Make Your Vacation Even More Enjoyable

There are a few insider secrets that can help to reduce stress and enable you to enjoy your vacation even more. We recommend:

  • Credit cards that allow lounge access. Our favorites include American Express Platinum, airline-specific cards, and the Chase Sapphire card. 
  • Skipping general screening. We suggest getting Global Entry, Nexus, or Clear for quicker security lines
  • Using your Schwab (or other brokerage) cards to withdraw cash. These can be free abroad and have a great exchange rate. Using your brokerage account to get money when traveling is a great benefit. You don’t have to worry about bringing foreign currency and can just withdraw euros, pesos, etc., at a regular ATM at your destination. There is zero ATM fee, and the rate is much more competitive than the money exchange shops.

Ways to Inspire a Memorable Vacation

When planning your next getaway, think beyond traditional tourist destinations. Consider embarking on non-traditional trips that promise unique experiences and cultural immersion. Explore options like joining National Geographic Expeditions or opting for unconventional tour groups that offer off-the-beaten-path adventures. These experiences not only broaden your horizons but also provide unforgettable memories that traditional vacations may not offer.

Travel Insurance, is it Worth it?

Before embarking on any journey, it’s crucial to consider travel insurance. For some travelers, it is essential (especially for peace of mind), but many folks are fine to travel without it. It might be worth it if:

  • The trip costs are non-refundable, and you’ve allocated more than your travel savings
  • You are traveling internationally or to a remote area with limited healthcare facilities.
  • You are traveling to a hurricane-prone area.
  • There are many connecting flights or multiple destinations.
  • You need flexibility to cancel your trip or return home early.

Additionally, some credit cards may offer travel insurance as a perk, so assessing whether it meets your specific needs and risk tolerance is essential. 

Consulting with your financial advisor can help you weigh the risks to navigate the travel insurance decision, ensuring you’re adequately protected against unforeseen circumstances such as medical emergencies, trip cancellations, or lost luggage. Additionally, communicating your travel plans with your advisor can mitigate the risk of fraud, especially when traveling abroad, by implementing preventive measures to safeguard your finances.

Take the vacation! But include your advisor in the planning process

In conclusion, prioritizing vacations is beneficial for your overall well-being and crucial for maintaining a healthy work-life balance. By collaborating with your financial advisor to establish a dedicated vacation fund, you can ensure that your vacations are enjoyable and aligned with your long-term financial goals. Remember, investing in experiences enriches your life in ways that money alone cannot measure. So go ahead, plan that dream vacation, and create memories that will last a lifetime.

As financial advisors, we fully support vacations (and have been known to take epic ones ourselves at Northern Lights Advisors). We would love to help you include saving for one in your long-term planning, so schedule a meeting today. 


The information in this article is not intended as tax, accounting, or legal advice. Read the full disclaimer here.a