After the grind and commitment of a 9 to 5 job or running your own business, full time retirement may well seem like just one (very welcome) holiday. You can do what you want, when you want, and for how long you want. Bliss!
One of the big bugbears of full-time work is the limited amount of holiday you can take, and often the length of that holiday too. Ask for three weeks in a row, rather than just two, and most employers would suck their teeth hard!
As a retiree, however, you can go for as long as you like, when you like, to take advantage of better weather and cheaper deals in more exotic locations. All you need now is to budget for them.
Your personal holiday budget
Post COVID, we are all travelling once again. From many years of planning with clients, the annual holiday budget seems to be a constant figure, averaging between £3,000 to £10,000.
However, for 2023, this budget needs to be changed. One reason is purely down to price increases, but the other is that people want to really make the most of the travel and do more. Very few actually set aside a realistic amount which is based on what they actually want to do. Plus, the funds are generally held amongst normal savings for general purpose.
I now encourage clients to create a separate account just for leisure spending over the coming year and the next.
Why? I have found that when you set a budget, you can allocate that amount to all your holidays, which include long weekends away and the big trips A specific budget can actually encourage you to book your holidays as you have to spend this money.
Just pretend that you’re a running a company budget. If you don’t spend it in that year, you lose it. I know I would rather ensure I spent it!
Now plan the next 3 years’ big holiday or trips you really want to do. Get the pricing for if you went this year, and set this amount aside now if you can. Then just keep an eye on pricing as the time gets nearer – year 3 will come along very quick! Keep this as a rolling 3-year spend and see how it goes. You never know, you may have money left over to a spur of the moment trip.
Leisure budget and holiday budget
It may seem a little bizarre to set aside a defined annual leisure budget, but there are three good reasons to do so:
- Your overall leisure budget is the amount you have to spend on all those “out of the house” things you want to do, from days trips to short UK breaks to longer holidays worldwide. By setting a budget in advance that fits with your overall spending, you won’t feel guilty that you are using everyday income to pay for holidays.
- Your budget is there to spend. It’s a constant reminder not to put off booking or taking holidays until “later”. Regular breaks give your retirement year structure and enjoyable milestones to look forward too. What’s more, being an annual budget, if you don’t spend it, it’s “lost” back into general income. When it comes to your leisure budget, use it or lose it!
- You can take advantage of great deals at any time of year. Rather than waiting to see if you “have enough” to book an autumn holiday, you can book it in January and benefit from a wider choice and (probably) better deals. In contrast, you can always jump on a great deal that comes up knowing that you have a certain amount left to spend.
Budgeting and booking out holiday time also gives you the opportunity to put non-grandchildren care periods into the family diary, so your children can plan for your absence in advance.
You know the feeling. You’ve gone on holiday for a week. It takes you three days to get over the journey, three days to relax and you have to go home again! Even a two-week break means you haven’t really time to truly settle and enjoy everything the resort/area/country has to offer.
By taking a longer break, you can combine the relaxation of a holiday with the familiarity of a daily routine that may or may not mirror your own at home.
- If you prefer to eat in the middle of the day, do so. Book a table at a local restaurant and enjoy the experience.
- If you like to exercise in the mornings, swap your home gym routine for a dip in the pool or a group workout on the beach.
- If you like to unwind in front of TV, then take your tablet or Netflix sign-in with you and chill out with a cocktail rather than a mug of tea.
Retirement holidays can save you money
A longer holiday can also save money on what you’d normally be paying for anyway. Winter sun holidays enable you to turn down the heating to tick-over at home and let the sun warm you instead. Your holiday accommodation might include a certain number of meals, local restaurants may be cheaper than in the UK, or if self-catering, your food bill may be a lot cheaper when shopping at local markets. Remember, some of your leisure budget is for meals out. So if these are cheaper abroad, happy days, that’s money saved!
Do check your home insurance policy as they may have an occupancy clause if you stay away from your home for more than 30 days. Also be aware that some countries’ tourist visas, such as Spain, only last for up to 90 days stay. Remember, as a retiree, you can enjoy a month away (say), come back home, and then jet off again in a few weeks’ time.
More time, more experiences
Talking of which, my wife and I are off on our travels again in April, taking advantage of great rates on an amazing cruise. We’ve then added our arrangements to extend our time in Australia, Hawaii and California.
Needless to say, I’m not retired yet, so the laptop/tablet will be coming with me so I can continue to help clients wherever I am in the world. That’s the reality of a modern, interconnected world – the ability to balance important holiday time with work if required. Or just make your family envious of your Monday morning view over smoking volcanos and rolling surf…
And if you don’t have to do any work, brilliant. That’s more time for buffet breakfasts, lazy lunches, afternoon siestas and delicious dinners. Or more days to explore, to experience, to enjoy learning new skills or just to talk to new people.
See you at the bar after my surfing lesson….