The Christmas and New Year holidays
are here and there is excitement about travelling to go and see friends
and relatives. However, all of these fun are not without cost, experts
believe it is necessary you consider the financial implications before
embarking on the holiday cruise.
Nimi Akinkugbe, personal financial
adviser said with all the excitement of deciding where to go and what to
do, it is so easy to overspend. Here, she list steps that could help
manage spending and cost this season of festivities.
Plan ahead
I hope that you haven’t waited until
the last minute to make arrangements for your holiday, unless you can
afford to be flexible and accept whatever is available. Last minute
bookings can cost you twice as much as if you had booked weeks, if not
months in advance. This can get really expensive when you are making a
booking for a large family or group. When you book early, there is more
time to make travel arrangements and shop around for better deals on
fares, hotel accommodation and tour packages.
You can use your air miles to offset
your ticket or accommodation costs, if you book far in advance of your
trip. Bear in mind that the best value you can get with your air miles
is to use it during off-peak seasons when demand is low. It is almost
impossible to find air mile tickets now.
Draw up a holiday budget, and stick to it
Once you have an idea of the sort of
holiday you would like and where you would like to go, start working out
how much it will cost; don’t forget the extras that tend to spring up.
You do not have to travel to an expensive and exotic location just
because “everyone else” is doing so. Of course, a two-week cruise on the
Nile sounds wonderful and is what you deserve, but can you really
afford it?
Look critically at your finances. How
much spare cash do you actually have to spend? Are there any additional
inflows you can expect over the coming weeks? Have you saved towards
your holiday? By putting some money aside in advance, you won’t be
tempted to make a huge dent in your savings all at once.
Set an overall spending limit and
involve your family in setting their individual limits. You will need to
budget for the various aspects of holiday spending including
accommodation, transport fares, food, shopping, entertainment, gifts,
excursions and so on. Try to stay within your budget without taking all
the fun out of the holiday. Avoid borrowing to finance your holiday
unless there is the absolute certainty of an impending inflow of funds.
Have you sorted out your spending money?
Cash withdrawals can be made using your
Mastercard Debit Card; this is accepted at over a million Automated
Teller Machines (ATMs) globally where the Mastercard sign is displayed
to either pay for goods and services or access cash. Linked to your
Current or Savings account, all transactions reflect instantly.
If you plan to use your cards whilst
you are away to save you carrying too much cash, notify your bank or
credit card company; as an added security precaution, many card
providers look out for what appears to be “suspicious” activity. If they
see your card being heavily used particularly in what is an unusual
environment for you, your account may be suspended until they have heard
from you to confirm that it is indeed you using the card. Ensure that
your card providers can reach you whilst you are away. As far as
possible use your debit card for withdrawals at ATMs during bank opening
hours. Remember to hold some cash as back up just in case your card is
lost, stolen or gets stuck in an ATM.
You can also make payments and transfers out of your account from online banking solutions if you have this in place.
Licensed bureau de changes are
available at major airports; this is very convenient particularly when
you arrive, but they tend not to be as competitive as those in town.
Look out for the commission charge and the exchange rate offered. Work
out exactly how much you will get in exchange for your currency, to make
sure it meets your expectations. Be cautious when you patronize
moneychangers, as there is the very real risk of being shortchanged or
sold counterfeit money.
How will you get around?
As far as possible book your car ahead
of your departure as picking one up on arrival is usually more
expensive. Read through the terms and conditions fully understanding the
insurance terms, particularly where you require a self-drive car rental
for a period. Car hire services are readily available but it is safer
to patronize a reputable licensed agency.
Be particularly cautious of
opportunistic “taxi drivers” who beckon as you step out of the arrivals
hall; they are looking to make money from unsuspecting tourists and
visitors and will charge exorbitant rates. Go to an official taxi rank
if you haven’t booked a car in advance, and make sure you are getting
into a licensed taxi.
Are you insured?
Have you given any thought to what
would happen if something were to go wrong? While vacations usually go
without incident, you don’t want to be caught unawares. What if someone
in your family suddenly falls ill? What if your luggage gets lost or you
have to cancel your trip? Travel insurance usually includes coverage
for medical bills, lost baggage and cancellations. Read the fine print
to ensure that you have the best coverage at affordable rates and make
sure your medical insurance card is on you.
Beware of roaming charges
To use your phone abroad you will have
to pay to both make and receive calls. The “roaming charges” can result
in a shocking telephone bill when you return home. Contact your service
provider and be sure of the implications and costs. Often people end up
with huge bills without even knowing how it happened. Pay your bills in
advance so that you don’t get cut off whilst you are away.
It makes sense to buy a local SIM card
when you arrive at your destination; make sure that your friends,
family, colleagues and important contacts have the number so that you
don’t miss out on important calls. Most SIM cards don’t charge to
receive calls and making calls will be much cheaper than using your
usual number.
Above all, remember that a vacation is
really about spending quality time with loved ones, having time for
yourself and to just rest. It need not be that expensive; you can
rediscover your own environment by visiting places close to home,
revisit your hobbies, pastimes, and sports. With a little careful
planning, you can find a balance between having an enjoyable vacation
and still keeping your finances in check. Happy holidays!
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