How to Plan A Perfect Vacation Trip: 7 Easy Steps (+ budget tips)

Want to learn how to plan a vacation? I’ll tell you, but first: Do you know what one of my favorite parts of vacations is? No, it's not going to awesome places.

Or eating delicious food.

Or making cool friends along the way.

One of my favorite things is planning a vacation. Nothing makes me feel better than a well-formatted calendar with flight info and dinner reservations.

Check out this itinerary I prepped for a recent trip to Singapore:

I even include weather information and airport lounge access information.

It looks like a lot… and it is. However, you don’t have to go as crazy as me.

Today I'm going to show you a simple system that will make your trip MUCH easier.

How To Plan Your Vacation In 7 Easy Steps

• Step 1: Decide where to go
• Step 2: Pick a time to travel
• Step 3: Take time off work
• Step 4: Find affordable flights
• Step 5: Find a great place to stay
• Step 6: Call your credit card companies
• Step 7: Budget consciously for your trip

We've reached out to influential travel bloggers and experts who are committed to helping travelers like you make the most of their vacations. These experienced individuals are passionate about sharing their knowledge and insights to enhance your travel planning. Without wasting any time, let's dive straight into their valuable tips.

Step 1: Decide Where And How To Go

Naturally, where and how you go on vacation is determined by your circumstances:

• Are you more crunched for time or money?
• Are you traveling alone or with friends or your family?
• Is your work flexible with when you can leave, or do you have a set time frame when you can travel (e.g., if you’re a teacher)?
• Do you want to go somewhere close by where you can drive, or would you have to fly?

Depending on your situation, you might also break from the suggestions in this article, and that’s okay! I only want to provide a framework you can work from. What you do with it is ultimately up to you.

Knowing this, you’re going to want to decide where you want to go. Doing this first is important for two big reasons:

1. It helps you psychologically. The mental benefits of setting a good goal are enormous. Having a goal destination in mind gives you something to work for when you’re preparing for your trip.
2. It determines practically every aspect of your travel planning. No two vacation destinations are alike, which means each destination is going to change the way you tailor your budget and itinerary.

However, it can often be hard to decide where you want to go.

After all, you can travel anywhere in the entire world. With all of your choices, how are you going to decide?

There are three great areas you can look towards to find your next vacation spot:

1. Recommendations
2. Social media
3. Friends and family

Recommendations

People you trust can be great sources of destination inspiration, and it’s the main way Matthew Karsten, aka the Expert Vagabond, decides where to go next. Check out his website—he definitely knows how to plan a vacation.

“Word of mouth is probably my top source for recommendations,” Karsten says. “[When I hear of a good place], I keep a bucket list of destinations I want to visit in Evernote, along with details about possible activities and links to relevant online articles.”

You can ask your friends and loved ones for good vacation recommendations. See what they liked about the place and what you can do there if you decide to visit.

Also, create a bucket list of destinations you’d love to visit.

It doesn’t have to be on Evernote either. It can also be in a Google Doc, Excel sheet, the Notes app on your phone, or your middle school diary. Every time a friend recommends a place to go, write it down. You can refer to this later when deciding where you want to go.

Social Media

Your Facebook and Instagram aren’t just for getting likes; you can also use them to find awesome vacation destinations.

“I use Instagram’s collections feature to save other people’s photos based on location,” says Karsten.

He continues, “Instagram changed travel a lot. All of a sudden, destinations that never saw too many tourists are getting swamped with people trying to copy popular photos they saw on Instagram.”

Though you might not want to copy other people’s photos, you can leverage Instagram collections like Matt’s and start compiling your own images from places you’d like to go. For information on how to exactly do that, check out Instagram’s page on it here.

Friends And Family

Sometimes the best vacation destinations are where your friends and family are. Not only can they help you save money on accommodations, but they can also fill you in on things to do there.

“I’ve been traveling more for friendships than anything else,” Naveen Dittakavi of the travel deal website Next Vacay says. “It’s nice to bond and catch up with old friends especially as we get older.”

Do you have a friend you’ve been meaning to visit for a while? Or maybe a family member you haven’t seen in a long time? Reach out to them and use the opportunity to visit them.

ACTION STEP: Decide Where You Want To Go And Be Specific

Once you decide where you want to go, I want you to be specific about it. It can be anywhere. Say you decide, “I want to go to London!” I want you to get even more specific with it.

A good example: By July, I want to go to London for a week with my boyfriend.

If you want to take it a step further, set a SMART objective for your vacation plans.

SMART stands for:

• Specific
• Measurable
• Attainable
• Relevant
• Time-oriented

Setting SMART goals is the solution to vague goal setting that gets you nowhere, like those New Year’s resolutions that just say  “I want to get fit”, or “I want to travel in the future.”

The way a SMART goal works is that it niches down big, vague goals and gets precise with them. This leads to better focus when you set out to accomplish your goals.

Check out my article on how to set SMART objectives to learn how to craft one yourself.

Watch episode 80 of my podcast to see how a couple debates vacation plans against a backdrop of financial success.

Step 2: Pick a time to travel

Traveling is like a game of Twister: It's best to stay flexible.

When you travel is just as important as where you travel. In fact, your timing can mean the difference of hundreds, possibly thousands of dollars in airfare.

Let's say you want to take a 7-day trip to Cabo from New York City.

Here's what a flight from July 6 to July 13 costs:

And here’s a flight two months later:

Time matters! Which is why you should be flexible with your travels.

Flexibility is the most important thing in finding a cheap flight, says travel blogger and entrepreneur Nomadic Matt. 

“You need to be flexible with your date. If you have to go to Paris on a specific date, then you have to pay the fare. There’s no magic bullet to make the price go down. But,” He says, “by changing your date by a day or two, you might be able to drop the price.”

If you want to find the best time to travel to a destination, consider these three things about the location:

• Peak season. This is the time of year when most tourists will visit a location. This is often due to the good weather and holidays surrounding it (e.g., the Grand Canyon or Mount Rushmore in the summer). Flights and accommodations tend to be the most expensive during this time.
• Off-peak season. This is when the majority of tourists aren’t visiting a destination, typically due to weather (e.g., a ski lodge in the summer). You’ll normally find very affordable flights and accommodations during this time, but on the flip side, there’s usually a reason for it being off-peak. In some countries, off-peak can mean a monstrous monsoon happens nearly every day.
• Shoulder season. This is the time between peak and off-peak and a good time to take advantage of the benefits of both seasons.

ACTION STEP: Find A Date To Go On Vacation

Pull up Google Calendar and start looking at dates that work for you.

If you’re looking to save extra money on travel, consider your destinations off-season or shoulder season.

Nailing down when exactly they occur isn’t difficult, though, as long as you take into account several factors. The biggest of which are:

1. Weather. Summer is always going to be an incredibly busy time for common vacation destinations like cruises, beaches, and, well, anywhere where there are outdoor activities. Also, the fact that school is out for the summer means families will be traveling a LOT during this time.
2. Holidays. Do you know what’s more expensive than vacationing in New York City? Going to New York City on New Year’s Eve. And if you’re budget-conscious, you’re going to want to keep in mind the holidays when YOU travel. Depending on the destination, flights and hotels are going to be more expensive if your trip lands on a major holiday.

Bryce Conway, CEO of the travel hacking site 10xTravel.com, leverages this knowledge when he travels. Here’s some of his great advice for discovering an area’s peak season:

• Call the local tourism office. Most every country, state, and city will have a tourism office that’ll be more than happy to help you with your travel plans. Simply ask them, “When are your peak season months?” (For a comprehensive directory of U.S. tourism offices, follow this link.)
• Compare flights and hotel prices for different dates online. If you find that the date you’re trying to book is WAY more expensive than another one a few months away, you might be booking in peak season.

Remember: Not all destinations are alike. That means their peak, off-peak, and shoulder seasons will be different.

Once you know where and when you want to travel, it’s time to…

Step 3: Take Time Off Of Work

SAD FACT OF THE DAY: The majority of Americans don’t use all of their vacation days.

A 2018 study conducted by the U.S. Travel Association discovered that over half of Americans leave vacation days on the table due to pressures at work.

This. Is. RIDICULOUS!!!

You’re losing time and money by not taking your vacation days. These are benefits ensured to you by your employer. Use them!

And if you’re on vacation, you’re definitely going to want to use them (yes, even YOU, remote and freelance workers).

If you’ve read this far, you’d LOVE my Ultimate Guide to Finding Your First Profitable Idea

It’s one of the best things I've published, and totally free – just tell me where to send it:

ACTION STEP: Take Time Off Work

The difficulty of requesting vacation days varies from job to job. However, you can make the process simple for you and your company by using some good old-fashioned scripts.

Oh, look, here’s one now:

Subject: Vacation request (October 2nd through October 6th)

Hi [manager’s name],

I’d like to request vacation time from Monday, October 2nd, through Friday, October 6th, because I’ll be taking a family vacation over those days.

While I’m gone, I’ll be reachable by phone but not by email. I’ll be making sure that we have coverage in the support queue. I’ll also be distributing a playbook to my team so it’s clear who owns which issues.

Is this OK?

Thanks,

-Ramit

This is a great script to use, even if your vacation is during a busy time for your company.

Why? First, consider why your boss might want to deny you vacation time:

• You own a project, and it might not get done while you’re gone.
• The work might end up on your boss’s plate.
• Your boss might have to delegate YOUR tasks to other workers (which nobody likes doing).

This script addresses all of these points in the last paragraph. By showing that you’ve gone the extra mile to make sure that your responsibilities will be taken care of in your absence, you allay your boss’s concerns that your work won’t get done.

It also maintains a friendly tone throughout the message AND you give a good reason for your absence. You'll want to send this email weeks, possibly even months, in advance. It's far easier for your boss to say yes when the company has time to plan for your absence.

For more information on requesting time off, see my article on how to ask for vacation days.

Step 4: Find Affordable Flights

One of the most common misconceptions about traveling is the idea that flying (especially internationally) has to be expensive.

I have my thoughts on this… but I’ll let celebrity chef Gordon Ramsay take it from here:

“In fact, flying can be one of the most affordable parts of the trip if you know how to leverage the right tools.”

Two of the most effective tools to find affordable flights are:

1. Travel credit cards
2. Repositioning with error fares

Let’s take a look at both now.

Travel Credit Cards

We’ve written about travel credit cards before, but it bears repeating:

Using travel credit cards to pay for flights is a Big Win.

Say a round-trip flight from New York to Paris costs $500.

If you book using the card we’re about to suggest, you could get that same flight for FREE.

You can save THOUSANDS each year if you leverage reward points. And the more time you have to plan, the more points you can amass. Many cards even give you sign-up bonuses.

But with so many options out there, which one should you get?

For more information on travel credit cards as well as how you can maximize them, be sure to check out my article on the subject.

NOTE: If you’re in credit card debt, DO NOT sign up for a travel credit card… or any other credit card for that matter. Instead, check out my article on how to get out of debt fast.

If you’re nervous about getting into travel hacking through credit cards, that’s okay. There’s another solution that’ll help you find ridiculously cheap flights.

Repositioning With Error Fares

ACTION STEP: Start Searching For Error Fares And Reposition If You Have To

Sign up and start following the sites we mentioned above to find great deals on flights through error fares.

You might even get lucky and find an error fare through an airport near you!

Once you have your flight, you’re going to want to make sure you have a place to stay while you’re on vacation too. That brings us to our next step!

Step 5: Find A Good Place To Stay

Finding a great place to stay that doesn’t break the bank sometimes seems impossible.

However, finding a great deal on accommodations is simple IF you’re willing to break the mold.

“My wife and I were in Switzerland a couple of years ago, and we stayed at a hostel in a private room,” recalls Naveen. “There are no budget hotels in a place like Switzerland. It’s either a hostel or an ultra-glamorous hotel. The hostel we stayed at was still very comfortable and affordable for us, though.”

Along with hostels, travelers can also find great, affordable places to stay through home-sharing sites like Airbnb or Couchsurfing.

“If you want to save money on accommodations, backpacker hostels are the way to go,” Karsten says. “I once spent a month living in a Nicaraguan hostel for $5 a night!”

If you really prefer to stay in a hotel though, that’s okay! You can book awesome deals on hotels using travel credit cards since they often allow you to spend points on hotel rooms.

There are even awesome cards, like the Starwood Preferred Guest Credit Card, that allow you to maximize your points for hotel stays.

Many websites also exist to help you get the most out of your hotel bookings.

Naveen suggests i-escape.com. They have sweet deals for hotel accommodations at different price points. Another great one is Hotels.com. They have a program that holds 10% of your spending with them, and eventually, they give you a free night. So every 10 nights or so, you can get a free night in a hotel.

Want to learn how to plan (and go) on a trip without feeling guilty about it? I dive deeper into that topic here:

How to plan & go on AMAZING vacations, guilt-free

ACTION STEP: Book A Great Place To Stay

By being flexible and a bit judicious with your accommodation search, you can find an awesome place to stay during your vacation and not break the bank.

Use the tools below to help you find some of the best deals on places to stay.

• Airbnb. More than just renting spare bedrooms, you can find some really cool places at a relatively low cost if you are diligent in your search (you can even stay in a freaking castle!).
• Hotels.com. They’ve aggregated accommodations ranging from uber-luxury hotels to small mom-and-pop bed and breakfasts. Also, they’ll kick back a free night in a hotel for frequent users. Awesome.
• i-escape.com. Though a bit more limited in selection, i-escape gives travelers only the best accommodations at the best prices.
• HostelBookers.com. With over 35,000 hostels in over 170 countries, HostelBookers should be your first stop when trying to find a good hostel. You’ll have no trouble finding an awesome (yet budget-friendly) option here.
• HostelWorld. Another great option is to find hostels. The site’s 24/7 customer support is also on call in case you have any questions or concerns about your bookings.

The world wants you to be vanilla...

​…but you don’t have to take the same path as everyone else. How would it look if you designed a Rich Life on your own terms? Take our quiz and find out:

Take the Quiz

Step 6: Call Your Credit Card Companies

ACTION STEP: Tell Your Credit Card Companies About Your Travels But Prepare For The Worst

Call your credit card company and tell them about your trip.

Here are the numbers for the major card companies out there to help:

Visa: 1-800-847-2911

Mastercard: 1-800-307-7309

Discover: 1-800-347-2683

American Express: 1-800-528-4800

Simply inform the representative that you plan on traveling and that you’ll be using your card. They’ll ask you where you’re going, how long you’ll be gone for, and—voila!—you’re prepped for travel. Not getting stranded abroad is definitely a key step in planning a vacation.

Much like airlines, credit card companies often screw up even when you give them the heads-up.

You might find yourself in a situation where you’ve warned them that you’ll be traveling and they still cancel your credit card when you try to make a purchase abroad.

Thats okay! Because you’re an IWT reader, you’ve prepped for this situation by packing two alternatives:

Cash. It’s always a good idea to carry $100 – $500 in emergency cash just in case something goes wrong.

ATM/Debit card. One of the biggest hassles when it comes to getting money while abroad is international fees, especially when it comes to ATMs. However, you can circumvent that with the right cards. Certain cards, such as the Charles Schwabs debit card, will refund your ATM transaction fee.

Step 7: Budget Consciously For The Trip

There are TWO ways you can prep your vacation budget.

Save money for travel

Earn money for travel

Both can be simple, painless, and fun (seriously).

Watch the video below and head to the 44-minute mark where I answer a key travel question: Is your budget suitable for your destination? Tune in for my detailed response.

https://youtu.be/7wKEice99Dk?t=2647

How To Save Money Before You Plan A Vacation

One of my favorite ways to save money for a trip is through a process called mental accounting.

Pretty much what mental accounting looks like.

Mental accounting is a psychological technique wherein people treat money differently depending on how they get it and plan on spending it.

A great example of this is using a sub-savings account.

Most banks allow you to create a sub-savings account along with your normal savings account (you can even name them too!). You can put money into this account each month and know that it’s going toward your travel goals.

By mentally accounting this money for travel, you’re leveraging a powerful psychological trick of focusing on your savings goals.

You can even couple the sub-savings account with another great system I love—automated finances.

Automating your finances is a system wherein your money works passively for you. It’s the ultimate cure to never knowing how much you have in your checking account and how much you can spend.

When you receive your paycheck, your money is funneled to exactly where it needs to go, whether that be your monthly bills, Roth IRA, 401k, or savings account.

“I always have a budget for travel,” Naveen says. “That includes saving a couple of hundred dollars a month towards a travel fund. This is the money that I saved through the IWT system. I use it for hotels and restaurants.”

ACTION STEP: Automate Your Financese

If you want to learn more about how to automate your finances, check out this 12-minute video of me explaining the exact process I use below. 

Automating Your Finances in 12 Minutes, with Ramit Sethi

Setting everything up won’t take more than one or two hours out of your day, but it will save you thousands of dollars over your lifetime.

Earning Money While Traveling

• Create multiple income streams so you always have a consistent source of revenue.
• Start your own business and escape the 9-to-5 for good.
• Increase your income by thousands of dollars a year through side hustles like freelancing.

Saving money isn’t the only way you can hold onto cash during your travels. There are a variety of ways you can earn money while abroad too.

That’s why my team and I have worked hard to create a guide to help you navigate all the systems that’ll help you earn more money today: The Ultimate Guide to Making Money.

In it, I’ve included my best strategies to:

Frequently Asked Questions About Planning A Vacation

How much money should I save for a vacation?

If you’re thinking of an ideal budget for a vacation, a good rule is to spend around 15% of your gross income on vacations for the year. So divide that amongst the number of trips you want to take and that’s your budget per trip, although some trips can be more expensive! They don’t all have to be the same price.

What is a perfect vacation?

It depends on you! A perfect vacation might include the perfect place with the perfect people, and plan, and nothing goes wrong—or it does. There are things out of your control to consider, like weather, mood, activity times, and other things that help or hurt your plans.

I have certain non-negotiable travel rules that help me create a vacation that’s perfect for me—you can see them here on this LinkedIn post. Think about what some of your travel rules might be and keep them in mind when planning your perfect vacation.

How much money do you need to travel for a week?

On average, people spend between $1500-$2500 for a one-week vacation trip. That’s about $180-$310 a day for hotel + food, and around $400 for airfare alone. That doesn’t include other travel expenses, like car expenses or attraction fees. If that seems like a lot, it’s OK! Read this recent article in the India Daily Mail, which highlights my tips on the right way to spend more money!

How do I plan my vacation days?

Plan your vacation days smartly by first eyeing the calendar for slow work periods—those are your prime slots. Decide what kind of break rejuvenates you: adventure, relaxation, or a productive staycation. Then, strategically use your days around long weekends and holidays to stretch your time off even further. Keep a few days reserved for spontaneous needs or mental health breaks. Before jetting off, ensure your work is squared away and your team is prepared for your absence, allowing you to truly disconnect. 

Vacation days are part of your pay—use them wisely to recharge fully.

Budgeting is unsustainable. Start “Conscious Spending” instead.

As seen on the IWT podcast, my Conscious Spending Plan helps you buy the things you love, guilt-free.

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