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I remember sitting down to dinner at an Italian restaurant in Fort Lauderdale. That afternoon we had completed a four-day sailing course. We had been toying with the idea for over a year, but this course had been the test. Did we really want to quit our jobs, leave our home in Colorado and travel full-time by sailboat?
That evening, over a couple of well-deserved pasta dishes, we decided that we did.
Once we agreed on the goal, we began discussing changes to our financial habits, priorities, and lifestyle.
Whether your dream is to travel by RV, van, boat, or around the world with just a pack on your back, the process for saving is the same. Below are the seven steps we took to reach our financial goal.
Step 1: Analyze Spending
Before we can talk about saving money, we need to understand where it’s going. To analyze your spending, you’ll need to determine the process that works best for you.
Find a Process
- PEN AND PAPER: it’s more time-consuming, but it can be therapeutic to write down each of your expenses.
- SPREADSHEET: this allows you to record expenses and also organize and sort your data.
- SOFTWARE: our favorite application is Intuit’s Mint app. Signing is free and it’s available on both iOS and Android. Mint has an excellent browser interface as well.
Regardless of what method you use, be aware of your spending trends.
- CATEGORIES: how much are you spending on groceries, rent/mortgage, transportation, etc.
- NEEDS VS. NICE-TO-HAVE: how much is going toward expenses that aren’t necessities.
- RATIOS: where do you stand against the average percentage of category spending (The Bureau of Labor Statistics has a lot of useful information to help you.)
Once you have analyzed this data (at least three months worth), create a budget.
PRO TIP: Don’t forget to include annual and one-time purchases in your budget. New phone, car maintenance, etc.
Step 2: Save Your Paycheck
Once you have a firm grasp of your spending, take a look at your income.
Use your knowledge of your spending and new budget to determine what you can save each paycheck. Whether it’s 2% or 10%, the point is you are saving something. I recommend starting low and increasing from there so you don’t get discouraged.
You won’t save everything all at once. Don’t be too hard on yourself. Remember that small and steady growth is a good thing!
Once you establish how much you want to contribute, open a bank account specific to your goal.
Setting Up a Savings Account
- Choose a high-yield savings account to help you reach your goal. It’s a great feeling to record the interest each month and see your money working for you. Check out Ally Bank. At the time of writing this, they were offering 2.2%.
- If your employer offers it, create a direct deposit into your savings account. For example, set up a deposit of 2% into your savings account and the rest into your checking.
- Lastly, never withdraw from this account. I repeat, do not touch this money 🙂
PRO TIP: If you expect you will need a new laptop, phone, etc., in the future, start saving now. Open a second savings account and set up a monthly deposit. Need a $1,200 laptop in two years? Start depositing $50 per month, and you’ll reach your goal.
This structure can help you shift your state of mind for saving. I looked at the contribution as what I owed the boat fund each paycheck. Paying the boat fund became just as important as paying the mortgage.
Step 3: Accountability
Most of us benefit from someone holding us accountable. Have you ever tried to keep a workout schedule or eat healthier? Having a partner in that journey makes success a bit easier. The same is true for any goal.
Ross and I committed to this adventure together. We held each other accountable for achieving the goal. But even if you are tackling this alone, you can find someone to share your plan with: a good friend, family member, or mentor. Someone you respect that will encourage you when you struggle to stay on track.
Step 4: Find a New Mindset
When we adjust our mindset on how and why we spend, it opens up many avenues to save more.
When you are making a financial decision, start by asking yourself this question.
Is this Expense a Necessity?
Look for ways to decrease the cost. Here are a couple of examples.
- Electric bill – dryers are an energy-hungry appliance. Can you start air-drying some of your clothes? Do your research on phantom power usage (power that is drawn even when devices are off). See how you can limit yours.
- Cell phone – if you have WiFi at home and work, check out some of the all-digital wireless cell carriers. We used Ting for years and cut our bill drastically. More recently there have been some new players on the digital wireless mobile scene. Visible by Verizon offers one plan with unlimited data for as little as $25 per month. We also like US Mobile for affordable, prioritized coverage. And if you really want to cut your bill, Mint Mobile has more restrictive data plans that you can pay for annually.
If the expense is not a necessity, it gets more complicated (and probably emotional). I don’t recommend cutting all the non-necessity costs from your life.
You want to be critical of your expenses but not miserable once you’re done slashing your budget.
If you look forward to getting your Starbucks latte every morning, and it makes you happy, do it. But then look at dropping one of the three paid streaming services. Or, instead of buying a new phone every two years, try and stretch it to four.
Flipping the Switch
This exercise is not meant to make you feel guilty about expenses. It’s to help us realize everything we buy with our hard-earned money is money not going to our priority, the travel goal.
Whether it’s a carton of yogurt, a new pair of shoes, or a car insurance payment. It’s about taking the time to consider every purchase.
I began to feel the connection between saving money and the goal of living on the water and traveling to new places. That’s when everything became more manageable. And that also leads us into step 5.
Step 5: Track your Savings
Tracking your savings is not just an important step. It will make the process fun and keep the motivation flowing.
We created a joint spreadsheet where we recorded our deposits into our ‘boat fund.’ I enjoy spreadsheets, so this worked well for me. I used Excel formulas to calculate a fluctuating ‘departure date’ based on the running savings total and travel budget. Geeky, I know, but I loved watching the date move as we contributed more (or less) to the fund.
Ideas to Track Your Progress
Track your progress in an exciting way, and it will make saving for the journey almost as fun as taking it.
PRO TIP: If you are tracking with a dry erase board or on an empty wall, decorate the area to be an inspiration. If you are saving to travel to Europe, add photos of places you want to visit. If you want to travel the US by van, add some pictures of van layouts you are researching. Display anything that creates positive vibes around your goal.
Step 6: Sell Your Stuff
Even if you plan to keep the home you own, you will most likely be downsizing as part of your goal to travel.
When we left, everything needed to fit in a truck and an SUV.
We made a point of adding the funds from anything we sold to the boat fund during that time. The correlation between selling stuff and reaching our goal made parting with unneeded items easier.
Maximize Your Profits
- Start selling early – take your time instead of trying to ditch everything in a last-minute garage sale.
- Sell seasonally – a mountain bike will sell for more in April than November. The opposite is true for Christmas decorations.
- Choose the right avenue – for bigger items where shipping is a hassle, try Facebook groups or apps such as Offer Up. These give you the option to sell locally. For in-demand electronics or antiques, try eBay to reach a wider audience. Keep in mind fees and shipping costs. Consignment stores can eat into your profits, but it may be worth your time with lower-value items.
- Create a list – record and organize a list of everything that needs to go. This will ensure items are not forgotten and are sold at the best time and on the right avenue.
PRO TIP: Make it a point to get rid of a little bit every week. I would revisit my closet weekly to find items for the consignment store. It was motivating to earn extra money from consigning that would put us closer to our goal.
Step 7: Challenge Yourself
Tackle a new challenge that will also help you save cash. This is a great way to learn and grow while working to reach your goal. Here are a few examples of things you can try.
Work toward making a sustainable home and save money on everyday disposable items.
- Save on paper towels by switching to cloth napkins and cotton towels.
- Get a bidet attachment for your toilet to save on toilet paper.
- Use beeswax wraps instead of plastic bags and wrap.
- Cut sodas and bottled water from your shopping list by investing in a water filter or making iced tea. If you need your soda fix, try a Soda Stream or Drinkmate and make your own while ditching the plastic.
- Re-evaluate your makeup and skincare routine. Adjusting to a max of 2 or 3 products will save time and money. Try a reusable makeup remover cloth instead of disposable wipes.
Dive into Cooking
Adjust your cooking habits and learn new cooking skills to save money at the grocery store.
- Make your own bread and yogurt (the ingredients are much cheaper)
- Make your own granola (buy the oats and nuts in bulk to save)
- Learn to cook tasty food without meat, or try limiting your meat (Meatless Mondays for the win!)
- Learn to can fresh vegetables when they are in season
Play the Credit Card Game
If you are a numbers geek, you can learn how to use credit cards to maximize your cash back and travel credit.
Ross did a ton of research and discovered the best ways to book trips almost solely on points. We also enjoyed big cashback rewards, which we applied to the boat fund.
There are tons of resources explaining how to use reward programs to your advantage. Like most challenges, it can be intimating at first, and you will need to do your homework. The good news is the payoff can be significant.
READ MORE: For an extensive list of money-saving tips, check out 50 Creative Ways to Save Money for Travel.
Final Thoughts on Saving to Travel
No matter how you plan to travel full-time, the main points to getting there are the same.
Train yourself to be disciplined and find small ways to keep yourself motivated. Most importantly, remember to have fun planning for this fantastic experience! The journey is just as important as the destination.
Want to learn more about getting ready for full-time travel?
Check out our travel resources guide for tips for saving money, travel gear lists, and more.
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