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How to Travel the World on a College Budget

How to Travel the World on a College Budget

Traveling is a great way to keep yourself going during the hard grueling semester’s work. But having the money to finance your travelling desires is truly the only thing in your way from dropping everything and leaving! Here are a list of very helpful, uncommon tips that will help you get away much faster on a college budget.

Ways to fund travel

Credit Cards

Using credit cards to travel overseas can be very risky; especially if you do not have the means and a solid plan to pay back the expenses that you will incur. The good thing about using a credit card to help you travel overseas is that some of them (please do your research before applying to any credit card company) come with currency exchange, so when you arrive in a new country it will exchange your currency for you rather than you having to go through the trouble of doing it yourself. You can also go to a neighboring country that uses the same currency, but has a better exchange rate, so you get more of their money for less of yours (keep that in mind)!

When using a credit card to travel out of the country, make sure that it can be used worldwide (check with the issuer). You could also look into a student credit card, which sometimes have better benefits for college students.

Just keep in mind that being irresponsible with credit cards will put you further into debt than the student loans you might be using for your education.

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Being financially literate will help you save money

Check with your bank to see what the ATM fees and debit/credit card usage policies are overseas. This way you’ll know exactly what you’re getting into and won’t feel blindsided if you come home owing a lot more money than you originally anticipated. Look into as many possible avenues as you can in regards to worldwide credit cards, student credit cards (that can be used worldwide), and programs such as the two below that can help you save money.

International Student Identity Card (ISIC)

The ISIC gives you access to student discounts on flights, museums, and attractions. You can save much more money by investing in this card rather than not. It doesn’t make anything free for you, but it does make certain things more affordable with the discounts that it gives you access to. You can visit their website for further information.

World Wide Opportunities on Organic Farms (WWOOF)

By becoming a part of WWOOF you’ll have access to jobs across the world, and will be accommodated on your journey to a certain extent. For all intents and purposes, at least WWOOF provides a place for you to stay. It is essentially like volunteer work. You do not get paid to help on the farm, but room and board are provided. Each membership costs $30 USD per year and needs to be renewed annually. You can read more from their FAQ at their website.

Where Should You Stay?

Hostel instead of a Hotel

Hostels are much cheaper and they can be found in various locations. There are hostels outside of the cities you’re visiting so it’s more cost-efficient, and hostels that are within the city limits which rival hotels. Most hotels are inside city limits and the prices are higher because of that reason. The important things to remember with hostels are as follows:

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  • Hostels may charge for using their laptops/tablets/computers–so make sure you bring your own.
  • Drinks are cheaper at your own hostel
  • Use services like www.hostelworld.com or www.hostelbookers.com to find your hostel destination.
  • Never tell your hostel when you’ll be arriving. If you arrive late they will give up your room and you won’t be able to get your deposit returned to you.
  • Always bring a padlock (or two).

Getting There: Planes, Trains, and Automobiles

How to get there is important, every bit as important as keeping money in your wallet. Stay frugal, open-minded and choose your means wisely. Search for flights on lesser-known airlines. When you get to your destination, say if you’re going to a place such as Europe with a great train system, take the trains.

What to do when you get there

Follow the Deals

When you’re traveling with only your college budget in mind and not so much your destination, it makes it easier to stick to following the deals.

Your best bet is to schedule your trips outside of major tourists’ months, when the prices drop. If you get off the main streets and avoid the major attractions, you’re sure to find cheaper prices and more of an authentic “local” experience.

Buy food in bulk and cook for yourself, if possible

This will lower the expenses on buying food at restaurants by a great deal! If you’re staying at a hostel, most of them provide kitchens for this reason alone.

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Talk on FaceTime and stay on Wi-Fi instead of using your minutes overseas

Overseas plans for each carrier are different, so you definitely want to check with your phone provider before leaving the country. Otherwise you may come home to a bunch of phone bills you weren’t expecting.

Search local tipping laws before you hand out extra cash to your bartender/waiter

It’s commonplace here in the states to tip a minimum of 15%, but that same rule doesn’t apply in most places overseas. As long as you look it up and find out for certain, you won’t feel bad leaving without tipping at all or as much as you normally would.

Look for free opportunities

Instead of looking for that club to go out to, or spending money at museums or galleries, you can save yourself money by going swimming in the ocean for free, read a book on a beach for free, or find the parks in the area and spend your day there. You can also hide away in a historic library

Packing: How to cut down on cost

Packing light is your best bet. You can avoid fees for extra bags this way and, if you’re backpacking, you won’t kill yourself with all the additional, unnecessary baggage.

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Packing light is also beneficial because you’ll be able to chase down and catch that bus rather than stand around waiting for a taxi. Pack lightweight, wrinkle-free or wash-and-wear pants, shirts, and travel jackets so that you can roll them up and save space. If you’re going for studies overseas then don’t take the hardcover books, find the paperback or electronic version.

Staying for an extended period of time?

Find local work to help immerse yourself in the culture and earn some extra money. If you go WWOOFing then you won’t be paid for working on the farm, but you may have access to other working opportunities in the area. If you do both you’ll get the exposure to two different working lifestyles overseas, additional language exposure, and you’ll have an asset that’ll help you stay financially afloat while you’re there.

Getting around overseas

You are better off renting a bike than paying for a tour

You can lose yourself in the city and learn so much more about it rather than having to pay out of pocket to be guided around to all of the major sights to see.

Be sure that you’re using public transportation instead of taxis

Taxis are great conveniences and luxuries at times, but the wallet doesn’t like them that much. Public transportation is pretty well developed in the other countries, especially Europe, the UK and major Asian countries.

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Jessica Millis

An experienced writer, editor and educator who shares about tips on effective learning.

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Last Updated on August 20, 2019

How to Set Financial Goals and Actually Meet Them

How to Set Financial Goals and Actually Meet Them

Finances can push anyone to the point of extreme anxiety and worry. Easier said than done, planning finances is not an egg meant for everyone’s basket. And that’s why most of us are often living pay check to pay check. But did anyone tell you that it is actually not a tough task to meet your financial goals?

In this article, we will explore ways on how to set financial goals and then actually meet them with ease.

5 Steps to Set Financial Goals

Though setting financial goals might seem to be a daunting task but if one has the will and clarity of thought, it is rather easy. Try using these steps:

1. Be Clear About the Objectives

Any goal (let alone financial) without a clear objective is nothing more than a pipe dream. And this couldn’t be more true for financial matters.

It is often said that savings is nothing but deferred consumption. Therefore if you are saving today, then you should be crystal clear about what it is for. It could be anything like kid’s education, retirement, marriage, that dream vacation, fancy car etc.

Once the objective is clear, put a monetary value to that objective and the time frame. The important point at this step of goal setting is to list all the objectives, however small they may be, that you foresee in the future and put a value to it.

2. Keep Them Realistic

It’s good to be an optimistic person but being a pollyanna is not desirable. Similarly, while it might be a good thing to keep your financial goals a bit aggressive, going out of the line will definitely hurt your chances of achieving them.

It’s important that you keep your goals realistic in nature for it will help you stay the course and keep you motivated throughout the journey.

3. Account for Inflation

Ronald Reagan once said – “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hitman”. And this quote sums up the best what inflation could do your financial goals.

Therefore account for inflation whenever you are putting a monetary value to a financial objective that is far away in the future.

For example, if one of your financial goal is your son’s college education, which is 15 years hence, then inflation would increase the monetary burden by more than 50% if inflation is mere 3%. So always account for inflation.

4. Short Term vs Long Term

Just like every calorie is not the same, the approach towards achieving every financial goal will not be the same. It is important to bifurcate goals in short term and long term.

As a rule of thumb, any financial goal, which is due in next 3 years should be termed as short term goal. Any longer duration goals are to be classified as long term goals. This bifurcation of goals into short term vs long term will help in choosing the right investment instrument to achieve them.

More on this later when we talk about how to achieve financial goals.

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5. To Each to His Own

The journey of setting financial goals is an individualistic affair i.e. your goals are your own goals and are determined by your want to achieve them. A lot of times we get on the bandwagon of goal setting only to realize later on that it was not meant for us.

It is important that your goals are actually your goals and not inspired by someone else. Take a hard look at this step at all the goals you’ve set for after this step, you will be on the way to achieve them.

By now, you would be ready with your financial goals, now it’s time to go all out and achieve them.

11 Ways to Achieve Your Financial Goals

Whenever we talk about chasing any financial goal, it is usually a 2 step process –

  • Ensuring healthy savings
  • Making smart investments

You will need to save enough; and invest those savings wisely so that they grow over a period of time to help you achieve goals. So let’s get down to ensuring healthy savings.

Ensuring Healthy Savings

Self realization is the best form of realisation and unless you decide what your current financial position is, you aren’t heading anywhere.

This is the focal point from where you start your journey of achieving financial goals.

1. Track Expenses

The first and the foremost thing to be done is to track your monthly expenses. Use any of the expense tracking mobile apps to record your expenses. Once you start doing it diligently, you would be surprised to see how small expenses add up to a sizeable amount.

Also categorize those expenses into different bucket so that you know which bucket is eating the most of your pay check. This record keeping will pave the way for cutting down on un-wanted expenses and pump up your savings rate.

2. Pay Yourself First

Generally, savings come after all the expenses have been taken care of. This is a classical mistake which almost everyone of us do. We pay ourselves last!

Ideally, this should be planned upside down. We should be paying ourselves first and then to the world i.e. we should be taking out the planned saving amount first and then manage all the expenses from the rest.

The best way to actually implement is to put the savings on automatic mode i.e. money flowing automatically into different financial instruments (for example – mutual funds, retirement corpus etc) every month.

Taking the automatic route will make us lose control of our money and hence will compel us to manage in what’s left with us thereby increasing the savings rate.

3. Make a Plan and Vow to Stick with It

Budgeting is the best to get around the uncertainty that financial plans always pose. Decide in advance how spending has to be made.

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Nowadays, several money management apps and wallets can help you do this automatically. It’s easy and who knows, you may just end up doing what people fail to do.

At first, you may not be able to stick to your plans completely but don’t let that become a reason why you stop budgeting entirely.

Make use of technology solutions you like. Explore options and alternatives that let you make use of the available wallet options and choose the one that suits you the most. In time, you will get accustomed to making use of these solutions.

You will find that they make it simpler for you to follow your plan, which would have been difficult otherwise.

4. Rise Again Even If You Fall

Let’s be realistic. It’s not like the world will come to an end if you made one mistake. This isn’t called leniency but discipline.

If you fail to meet your budget for a month, don’t give up the entire effort just like that. Instead, start again.

Remember that flexible plans are the most realistic plans. So go forward and try to follow your financial goals as planned but if for some reason, the plan gets out of hand for you, do not give up on it just yet. This has a lot to do with your psychology rather than any material commitment.

All you have to do is to stay on the road and vow to stay on it, no matter how much you fall down.

5. Make Savings a Habit and Not a Goal

In the book Nudge, authors Richard Thaler and Cass Sunstein advocate that in order to achieve any goal, it should be broken down into habits since habits are more intuitive for people to adapt to.

Make Savings a habit rather than a goal. While it might seem to be counter intuitive to many but there are some deft ways of doing it. For example:

Always eat out (if at all) during weekdays rather than weekends. Usually weekends are expensive. Make it a habit and you would in turn be saving a great deal.

If you are travelling buff, try to travel during off season. Your outlay will be much less.

If you go out for shopping, always look out for coupons and see where can you get the best deal.

So the key point is to imbibe the action that results in savings rather than on the savings itself, which is the outcome. Focusing on the outcome will bring out the feeling of sacrifice which will be harder to sustain over a period of time.

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6. Talk About It

Sticking to the saving schedule (to achieve financial goals) is not an easy journey. There will be many distractions from those who are not aligned with your mission. And it would be rather easy to lose the grip over your discipline.

Therefore in order to stay the course, it is advisable that you keep yourself surrounded with people who are also on the same bandwagon. Daily discussions with them will keep you motivated to move forward.

7. Maintain a Journal

For some people, writing helps a great deal in making sure that they achieve what they plan.

So if you are one of them, maintain a proper journal, where you write down your goals and also jot down the extent to which you managed to meet them. This will help you in reviewing how far you have come and which goals you have met.

Use this journal to write down all essential points such as your short term, mid term and long term goals, your current sources of income, your regular expenses which you are aware of and any committed expenses which are of recurring nature.

When you have a written commitment on paper, you are going to feel more energised to follow the plan and stick to it. Moreover, it is going to be a lot more easier for you to follow you and track your progress.

At this point, you should be ready with your financial goals and would be doing brilliantly with savings; now it’s time to talk about the big daddy – Investments.

Making Smart Investments

Savings by themselves don’t take anyone too far. However savings when invested wisely can do wonders and we are at that stage where we will talk about making smart investments.

8. Consult a Financial Advisor

Investments doesn’t come naturally to most of us therefore rather than dabbling with it ourselves, it is wise to consult a financial advisor.

Talk to him/her about your financial goals and savings and then seek advice for the best investment instruments to achieve your goals.

9. Choose Your Investment Instrument Wisely

Though your financial advisor will suggest the best investment instruments, it doesn’t hurt to know a bit about them.

Just like “no one is born a criminal”, no investment instrument is bad or good. It is the application of that instrument that makes all the difference.

Do you remember we talked about bifurcating financial goals in short term and long term?

It is here where that classification will help.

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So as a general rule, for all your short term financial goals, choose an investment instrument that has debt nature for example fixed deposits, debt mutual funds etc. The reason for going for debt instruments is that chances of capital loss is less as compared to equity instruments.

10. Compounding Is the Eighth Wonder

Einstein once remarked about compounding,

Compound Interest is the eighth wonder of the world. He who understands it, earns it… He who doesn’t… Pays it.

So make friends with this wonder kid. And sooner you become friends with it, quicker you will reach closer to your financial goals.

Start investing early so that time is on your side to help you bear the fruits of compounding.

11. Measure, Measure, Measure

All of us do good when it comes to earning more per month but fail miserably when it comes to measuring the investments; taking stock of how our investments are doing.

If there is one single step where everything (so far) can go wrong, it is at this step – Measuring the Progress.

If we don’t measure the progress timely, then we would be shooting in the dark. We wouldn’t know if our saving rate is appropriate or not; whether financial advisor is doing a decent job; whether we are moving closer to our target or not.

Do measure everything. If you can’t measure it all yourself, ask your financial advisor to do it for you. But do it!

The Bottom Line

This completes the list of tips for you to set financial goals and actually achieve them with not so great difficulty.

As you can see, all it requires is discipline. But guess that’s the most difficult part!

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Featured photo credit: rawpixel via unsplash.com

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