7/11/2011 12:26 PM ET|
How a vacation hurts your future
Well, sure you need a break from routine, but hang on to your wallet. Here are 5 sneaky ways this year's vacation could cost you in your golden years.
You work hard for your money and deserve to enjoy it.
But the escalating cost of getting away can sap your wallet and savings more than you realize.
According to AAA, roughly 57% of Americans plan to take a vacation of four days or more this summer. Nearly half are budgeting at least $1,000 for their summertime excursions.
While we might scoff at someone who buys a new, cutting-edge computer system or an HDTV multimedia setup once a year, few raise an eyebrow when just as much is spent on a vacation. It is as if "vacation money" isn't real money.
Even the most frugal vacationers may find that their fun in the sun ends up costing more than they expected, especially in the long run. Here are five reasons why:
1. Cutting into savings
Vacations can prove costly, especially if you bring an entire family along.
A recent survey by GfK Custom Research found that the travel behavior of Americans more or less corresponds to that of the average world citizen. Vacationing Americans, though, are willing to spend more money than tourists from any other country.
Despite that, the U.S. still manages to be close to the average of all countries in terms of outlay, the 16-country survey found: About one-third pay up to $1,236 per person, per year, on vacations; 15% spend between $1,235 and $2,472; 18% spend more than $2,472.
Yes, you work hard for your money and value time away from work and spending uninterrupted time with your family. But consider the underlying value proposition of a retirement plan -- compound interest.
If you were to put that $1,200 a year of vacation money into a retirement plan for 30 years (assuming a 5% average rate of return), you would amass more than $84,000 by the time you retired.
Again, this isn't to suggest you should abandon all future vacation plans. But it is enlightening to see how that once-a-year indulgence can add up.
2. Spending money you didn't count on
The costs of vacations and travel can add up quickly (and may be more than you had budgeted for) as you pay extra costs and fees.
If you are flying, there may be baggage fees and an added levy if you pick certain seats or require more legroom. Fees of a few dollars at the time quickly add up: headphones, curbside check-in, in-flight meals and snacks, movie rentals, pillows and blankets, early boarding, airport snacks, reading materials and Internet access. Failing to resist the lure of the SkyMall catalog will add to unplanned expenses.
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I have an uncle now in his mid 80's who was the family miser. Never went on vacation, never went out to dinner much etc..... Now he's laying in a nursing home shitting himself getting ready to die with three million dollars in the bank worried about who is mowing the lawn that he won't own when he's dead
I started my first job at 15 and will likely have to work till 60+. I mean retirement is a goal but so is life. Yes you need to save for retirement but don't store up treasures here on earth where moths eat them and rust destroys them, and where thieves break in and steal. Store up your treasures in heaven where moths and rust cannot destroy, and thieves do not break in and steal.
Life is more than just making and saving money. At the end of your life, you will have your experiences and the loves you made along the way. You may or you may not have money, but money will not be important and it certainly will not be holding your hand at your death bed.
My father worked all his life and rarely took family vacations. He accumulated millions of dollars by the time he retired at 68 finally enjoy the good life and promptly died at 72 of cancer. He worked and saved more than 50 years, but couldn't spend it all in the three short years of retirement and the nearly year in cancer treatment.
My brother spent money like a sailor - traveling the world, going on cruises, spending money as he made it. The rest of us siblings worked and saved. With the economic crash we all lost much of our savings. Now, at middle age, we are all almost equal in our equity, although my brother lived his life to the fullest while the rest of us stayed home to work and save.
Don't believe this crap about how much vacationing will cost you. Don't fret that your career is threatened if you take off for two weeks. Screw 'em. Live life NOW. You only have today once in your life. Use it wisely. No matter how bad the economy gets, you will surely die with more money in the bank than time on your meter.
Someone got paid to write this? What is the point of living if you can't enjoy yourself?
How do you you even know you will live to see retirement? How do you know you won't get sick and spend your "retirement" money for a nursing home? Save all your money for what? To take it to the grave with you, I don't think so. Spend, save, give a little a way to charity.
All things in balance. What a stupid article and as a cancer survivor, I'm going on vacation this year and every year to enjoy what time I have left. The future is never certain.
What a terrible article. Yet another news source telling us to stay inside and "play it safe". If we lived this kind of life, we'd all die anonymous, leaving behind wasted and meaningless lives. Take a month long trip around the world to discover new things, cultures and even yourself, then come back and tell me that it was money wasted.
Incredible. Really, really incredible advice.
This article is pretty rediculous. Everyone needs vacations so they remember what they are working so hard for in the first place. I'm in my early 30's, work 55+ hours a week, and take a trip at least once a quarter. Some are more elaborate like my vacation to Europe this fall, others are 3 day excursions over a holiday weekends. I contribute to my 401k and am on track to meet my retirement goals, have cash savings, and live within my means.
As long as you are planning for your future, travel on America! It's a big world out there and I intend to see it while I'm young enough to enjoy it!
I'll continue to save my money for that annual trip abroad and enjoy those photos and memories for the rest of my life.
Remember that most of the things you dream of doing today, you won't be able to do when you retired, you will be to old. The ONLY thing we have are our memories and it is up to use to decide if they will be good or bad. I would hate to think that in my old age the only good thing I could say about my life is " I worked hard and saved all my money." I want to think about the sunrises over the mountains and the sunset over the oceans. I want to think about the laughter of my children and grandchildren as we rode the rollercoaster.
Oh I hope you know by now that you will NOT take one single penny with you when you go, lol.
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