rediff.com
News APP

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  gplay

Rediff News  All News 
Rediff.com  » Getahead » I Dream: Of a lavish vacation!

I Dream: Of a lavish vacation!

Last updated on: February 16, 2011 09:50 IST


Photographs: Rediff Archives Anil Rego

We all have dream destinations for a vacation. Often they just stay as dreams for obvious financial reasons. However, if we were to plan it well, we could probably head to those dream destinations.

Taking a vacation is also important to de-stress in the super charged work environment that we inhabit in today. And an increasing number of individuals perceive vacation as a need and not necessarily as 'flippant throwing away of hard earned money' as the earlier generation believed.

So what does it take to plan and enjoy a lavish vacation?

Also Read:

I Dream: Of becoming a millionaire by 30

I Dream: Of leading a debt-free life

I Dream: Of owning a home

I Dream: Of the best for my child

I Dream: Of optimising my taxes

I Dream: Of turning around my finances in 2011

Budgeting


The money for your dream vacation has to come from your earnings and the corpus for this has to be built overtime.

The best way to plan your vacation is to set aside a certain sum out of your earnings specifically towards vacation.

Such amount can be in turn invested in a balanced / equity mutual fund which typically are fine for medium duration.

A need like vacation can be conveniently planned by means of high-risk avenues such as mutual funds or monthly investment into equity markets via Niftybees.

For someone earning Rs 25,000 per month, to set aside Rs 1,000 per month, may not be a huge bargain. Similarly for someone earning Rs 35,000 per month, a nominal Rs 2,000 per month can be set aside.

We illustrate the scenario wherein such amount duly invested in equities manage to build a sizeable corpus for vacation needs:

This is just one way of planning your vacation. However, you may religiously invest your money in avenues but when the time comes to redeem them, you may cringe at the thought of spending it all.

But then, you have stuck to your regime with ample discipline and hence, you deserve to splurge it on yourself. There are other means of planning your vacation as well, which we discuss in the subsequent sections.

Club subscriptions


One can avail a subscription with one of the clubs which offer vacation / package tours. They would have the option of collecting points over a period of time, and this would provide a discount on the travel availed. This would infact work very feasible for someone who plans vacations on a year-on-year basis.

There are many advantages that each such club offers, you need to evaluate across a few clubs and choose the one that suits you best.

Some such advantages offered by clubs are listed below:

Flexibility of vacations

You can choose the period in which you intend to travel, hence giving you ample space to coincide this with the leave sanctions at office / children holiday season etc.

Deeded membership for perpetuity


Most such club in a fit to keep the client for a longer horizon, provides opportunity to keep the membership for lifetime

Value-for-money packages

Heavy discounts, off-season travels, offbeat holiday locations and time sharing arrangement are some of the 'value-for-money' initiatives that clubs offer

Smart ways to vacation


Travelling

Scout for packages with discount, if it makes sense, you can choose to hire a personal car where the billing will be done on the number of kilometers. If one is very keen to travel by air than advance planning will be helpful as prices will be comparatively cheaper.

Use your LTA (leave travel allowance) and reduce your taxability. But you need to keep bills / ticket / boarding passes depending on the mode of travel to provide as proof.

Flexible stay

Time share stay would work beneficial if you choose to stay in expensive locations, another popular option is home stays -- these places are like individual homes which are well equipped with all the facilities like a normal home and also charge very less, they also provide the home away from home experience.

Off-season travels


In the month of December most of the tourist will be travelling to Goa, which makes the place overcrowded and expensive too as prices of all things right from stay to food to sport activities go up.

It would be wise to go to a location that is not amongst the most popular destinations and at times when the crowd is likely to be typically low. You can even check international tour packages which have become typically cheap.

Savouring the experience...

While you savour the experience of vacationing, you may not really want to hold back, but here again it is necessary to keep tab on your expenses. Before you head out to the destination, a thorough research on the most moderate means of transport / locations to shop, eat, relax will go a long way in ensuring that your purse strings remain intact.

If you are planning to use plastic money, keep tab by making quick notes on the number of times / amount for which you swipe the card. Here again, you would end up with a hefty bill to fend at the end of the month.

Hope this bit helps you make that elusive dream destination a reality!

righthorizons
Anil Rego is the founder and CEO of Right Horizons , an investment advisory and wealth management firm that focuses on providing financial solutions that are specific to customer needs.