Do you want to make Travel as good as free? Read on to know more!
“If travel was free, you’d never see me again”
How true is this quote! If travel was actually free, I wouldn’t even be here writing this. I would be somewhere out in the world, roaming the wilderness and exploring the hidden secrets of Mother Earth! But alas, travelling is not free and neither are most of the “aspiring travelers” today “Alexander Supertramp” to be able to be on the road without any money or luxury. Neither is there any reason for us to become “Alexander Supertramp” and venture out into the wild without any financial backup because how much ever alluring his story and adventure might sound, remember he died of starvation at the age of 24.
Some may argue that travelling is way more worth than money. I agree completely. But does that mean, money cannot be a tool with which your travel can be made possible? Nay, I would go out on a limb here and say; Money will make your travel possible – as many times as you wish for! You just need to plan for it properly and at the earliest!
In the past 7 years that I have been interacting with various clients for Goal Based Financial Planning, most of the bachelors and young couples mention “Travelling” as a common goal in their Goal Sheets. The passion for travelling to newer and newer destinations and the need to escape the lethal routine that is city life is increasing day by day. But is just dreaming about travelling to exotic destinations going to turn it into reality? No! Then how do we go about it? We Plan for it! Because failing to plan is planning to fail. And no one wants to fail and miss out on their travel dreams.
Well then how do we go about it?
Let’s take an example – let’s plan a very expensive trip and actually see for ourselves how easy it is to plan for travel! We are purposely planning an expensive and luxurious getaway because if we aim for the stars, we may reach the sky – except in the case of Goal based Financial Planning – if you aim for the stars, you can actually reach the stars – provided you plan properly and stick to the plan! In this article, I will always be planning by assuming the highest costs and always for the worst case. By doing this, we can always have some extra money left over after our the execution of our Travel goal is done! And we can always use the extra dough for some more exploring!
So let us assume that you want to take your spouse on a romantic and luxury trip to Paris-Venice-Rome for your 5th wedding anniversary which let us assume is 5 years from now.
Each trip involves many costs that go into making it a successful and comfortable one. We have to consider Fight Tickets, Accommodation, Food, Internal Travel by Bus, Taxi, Rail etc. and last but not the least Sightseeing expenses. I searched a bit on the internet and drew up a list of expenses that you would incur if you visit Paris-Venice-Rome for 6 Days. Here is a summary below:
Since you want to celebrate your 5th wedding anniversary in romantic Paris in 2022, we cannot use the Vacation cost calculated for 2017. We have to calculate how much your anniversary vacation will cost in 2022. For this we would assume the travel inflation (i.e. the rate at which the cost of travel increases per year) as 10%.
Now our objective is to arrange an amount of Rs. 620,046.35/- in the next 5 years. The simplest way of doing so would be to invest on a monthly basis to make corpus building a low cost activity. But how much per month would be required?
If we assume, that we invest in Equity Mutual Funds ,our rate of return on investment would be 12% and that as of now we have no funds to invest lump sum;
Here are the detailed calculations if we invest Rs 7592/- per month in Equity Mutual Fund SIP;
Thus, it is actually not that difficult to accumulate a good corpus for any Travel goal if we plan accordingly. By investing an amount of only Rs 7592/- per month you can easily plan a luxury romantic getaway for you and your spouse to Paris- Venice- Rome provided
· Start Investing Today – No postponing of any investment!
· Keep at it for a longer term – or for the duration of the goal!
If we really inculcate this good habit of planning then Travel will definitely not be free as we want it to be but we can make provisions for our Travel plans always! As Susan Heller once said, “When preparing to travel, lay out all your clothes and all your money. Then take half the clothes and twice the money”. If you have sufficient money, you will automatically build the courage to explore more and more destinations without a worry. But for that you need diligent and detailed investment planning for your Travel goals. Because if you fail to plan travel, you will plan to fail travel!
Don’t you agree? If you have any queries/thoughts or suggestions for this article, fire away in the comments section so I can get back to you!
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Pranjal Wagh
Founder & Director,
Samarth Wealth Management
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The author is a Certified Financial Goal Planner with over 7 years of Industry Experience and has managed to create wealth for more than 700 people through honest and client-centric financial advice. He has been the recipient of accolades and awards from Industry stalwarts in the Financial Industry. Through his organization, Samarth Wealth Management, he has also managed to conduct Financial Literacy workshops across many towns and cities of India thereby reaching out to more than 1200 people.
2 comments
Hmmmm… quite achievable! SIP for a Sojourn In Paris ?
Thanks for the comment! Investing via SIPs is a very affordable way of building wealth over the long run. No one beats inflation like Equity SIPs 🙂