Going on holiday should be a stress-free experience; budgeting done well can go a long way towards that.

By drawing up a rough budget you can estimate how much you'll need to save up before you hit the road. It'll also give you the opportunity to consider the merits of a personal loan to help cover the costs. Going on holiday needs to be a stress-free experience.

Budgeting done well can go a long way towards that. By drawing up a rough budget you can estimate how much you'll need to save up before you hit the road. It'll also give you the opportunity to consider the merits of a personal loan to help cover the costs.

Your budget can later be refined and used to set up an itinerary. It can be used to avoid running out of money at an inopportune moment. Using a budgeting app is a convenient way to keep track of all the aspects of your holiday. Whether you are going solo or taking a family trip, planning is your best friend.

#1) Plan far enough in advance

You'll save time and money by planning ahead. Whether you're going to Tokyo, New Zealand or just down the Gold Coast, you'll need a plan in place.  Once you have decided where you are going, you'll need to do a bit of research to start working out your expenses.

Travel expenses

When it comes to your travel budget, you need to make sure you take into account not only how you will get to your destination, but how you'll move around once there. Booking flight tickets may be cheaper if you buy them well in advance. You may also be able to get a package deal that includes rental vehicles and accommodation as well.

Accommodation

Location, location, location! Look for somewhere to stay that is central to your planned activities. Decide whether you would like to provide your own meals or if you need somewhere with a restaurant. By doing this you can find accommodation that suits you and find out exactly what it'll cost you. Booking in advance may require a deposit, factor this into your budget.

Food & entertainment

Making at least two of your own meals a day is more cost-effective. Try to find accommodation with the facilities to cater for yourself. Make a shopping list and budget accordingly.

Plan the entertainment for a trip beforehand. This way you will be able to account for entrance fees, snacks and spending money. Be generous with this part of your budget, the aim is to enjoy your holiday. 

#2) The best ways to save for your holiday

Saving for your holiday should be part of your day to day budgeting. The earlier you begin saving for it the better. There are a few tricks you can use to boost your savings.

Open a savings account that accrues interest

Check out different banks to see who offers the highest interest on savings. The longer you leave your money in this account the more it will grow. Your best option is a savings account that doesn't charge you fees on your savings account.

Term deposits

This is a good way to save if you have some time before you need the cash. Term deposits allow you to save money over a fixed period of time. The interest rates on these accounts are higher so the longer you lock the money down for, the more you earn. You can set up a term deposit with no fees, but you will be charged a penalty for withdrawing the money before the fixed term ends.

Personal loans

These should be your very last resort. Before you apply for one, consult your day to day budget. Make sure you will be able to afford the monthly repayments including the fees. Make sure you choose a long-term personal loan. Compare the fees offered by different lenders and make sure you get the best deal. Borrow only what you need to make sure you pay less in fees.

#3) Make provisions for an unexpected change of plans

Even the best made plans can't account for every eventuality. This is why it's important to have a section of your budget dedicated to Murphy's Law. Be prepared for the worst and if nothing goes wrong you can celebrate when you get home.

Plane tickets are usually one of the more expensive aspects of travel. Most flights will allow you to change your departure date, for a fee. If you're flying, find out what that fee would be. Add that amount to the emergency funds section of your budget. If you're driving, estimate what it would cost for emergency service or roadside assistance.

Pad your emergency funds with the cost of accommodation for a night. Don't tap your emergency funds until you are home safe and sound. At which point you could even use it to make a payment on your personal loan.

If you're leaving the country, make sure your medical insurance will cover you. If not, consider travel insurance before you finalise your budget. Depending on the insurance package and provider you could be covered for anything from medical emergency to delayed flights. Investigate and weigh up the cost vs the benefit.

#4) Choose quality over cost

It's tempting to believe that something expensive is high quality. Whether this is your accommodation, a restaurant, or some sort of entertainment. Do your homework! No matter the location of your trip, there'll be reasonably priced quality establishments. This is not to say you need to take the cheapest option either. Pay attention to the quality and what the reviews have to say.

Consider taking your holiday in the off-season. Many holiday hotspots have cheaper off-season rates. This is perfect if you are looking for a place to relax and enjoy the location. It's more than just the price of accommodation that drops. Rental agencies may offer special deals for off-season travel as well. This can be a good way to take a high quality budget-friendly holiday.

#5) Set your limits & complete the budget

Once you have your planning done, it's time to tighten up your budget. Now that you know the costs of travel, accommodation, food and entertainment, and you have worked out what you need in your emergency funds, set your limit. That'll be the maximum amount of money you'll be spending on this trip.

At this point, if the budget doesn't fit well you can move funds around until it does as long as that is within the set limits. Sticking to your budget from here on out is important. Whether you have taken a loan to pay for your holiday or not, deviating from your budget now will land you in more debt.

Paying for parts of your holiday in advance is a good way to secure them, just make sure that if it comes to it you will be refunded if you cancel your plans. Try to avoid using credit cards for your holiday. They are what is considered high-interest debt and your holiday could end up costing you more than you bargained for.

Planning your finances is the key to a stress-free trip. Take the time to save up so that you can take the trip you've been dreaming off, without needing to get into debt.

Your budget can help you do everything short of packing your suitcase. You can use your budgeting app, or a calendar to help you count down. Remember to pack your camera and focus on getting ready for the best holiday ever!