Thanks to the cost of living crisis, over a quarter of Brits are scrapping or reducing their holidays in 2024. However, it doesn’t have to cost the earth to see it, and travelling on a budget has never been easier.
In this article, we’ll provide some budget travel advice to help you reduce the cost of going on holiday. From mitigating your tax liabilities to shopping around, planning, and more, the financial experts from UWM Accountants are here to you find the confidence to enjoy a memorable trip away in 2024.
Image by Walkerssk from Pixabay
Five tips for travelling on a budget
1. Avoid travelling in peak season
When we talk about peak season, we’re talking about the heights of summer and school holidays. During these times, prices are hiked for almost everything you need for a holiday, from hotels to flights, activities, and more.
Not only can you save cash by avoiding the peak seasons, but you can also enjoy quieter airports, less intensely hot weather for trips abroad, and fewer tourists getting in the way of a relaxing break.
2. Plan ahead
Planning your trip can lead to significant savings as opposed to winging it when you arrive at your destination. Find activities and attractions you can enjoy, budget for them accordingly, and book all transportation in advance to secure better rates.
This is particularly important when flying because airlines will increase their prices closer to the departure date. Lots of them release tickets up to a year in advance with much lower prices, so if you can, plan as far ahead as possible for your getaway.
The same applies to trains, too, if you’re looking to travel in a more sustainable way than flying. Interrailing, for example, is becoming an increasingly popular option for seeing what mainland Europe has to offer, and booking your tickets in advance is a surefire way to save some cash.
3. Consider your accommodation
Again, planning is crucial for accommodation and most of the time, hotels and other accommodation options will be more expensive if you book them last minute.
When booking hotels through comparison sites, always search for their website directly, too, as they’ll often have better rates available because they won’t pay the additional commission the likes of booking.com charge.
As well as booking long before you arrive, reserving a room via Airbnb can allow you to experience life in somebody’s home in the place you’re travelling to. This not only brings costs down but can give you a unique insight into the everyday lives of locals. You’ll also receive tips on the best activities and how to make the most out of your holiday on a budget.
4. Keep an eye out for discounts
Rather than booking the first plane tickets you can find and the highest rated hotel you come across, stay informed about discounts available for your holiday destination. Lots of airlines, for example, will offer discounts in the weeks and months leading up to a flight, and the same is often said for hotels and apartments.
You can usually find deals for booking activities in groups, too, which can save you money for your travel plans.
5. Eat like the locals do
When travelling abroad, there are lots of tourist trap eateries that charge astronomical prices for below average food. Rather than choosing spots with lines of foreigners out the door, visit local restaurants for more traditional options with much lower prices.
This might mean heading out of the tourist centre if you’re visiting a city, but it’ll be worth it when you’re being served authentic food from locals. To find the best spots, ask people who live and work in the area such as bar staff, who are generally very knowledgeable about this kind of thing.
Looking for more ways to save? See how you can make the most of your money and protect yourself on holiday with the right insurance, using a credit card, and opting for package holiday options.
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Mitigate tax to free up holiday cash
A cornerstone of accounting and financial planning, tax mitigation can also help you reduce costs for your holidays in 2024. Here are some ways to reduce your tax liabilities when travelling on a budget.
Utilise marriage tax allowances
You may be able to transfer up to 10% of your personal income tax allowance to a spouse or civil partner. This helps you save money on taxes that can be put towards your dream getaway.
Use your capital gains tax (CGT) exemption
CGT mitigation isn’t just for business tax planning; everyone has an annual CGT exemption of £6,000 that can’t be carried into the next tax year. Make the most of this in full to reduce future CGT liability and reduce travel costs.
Use your personal savings allowance
The income tax personal savings allowance (where no tax is due) is up to £1,000 a year for basic-rate taxpayers and £500 per year for higher-rate earners.
You can also combine your allowances if you hold savings jointly with a partner or spouse, which frees up even more cash for holidays away together.
Make the most of pension contributions
Up to £40,000 a year can be contributed to a pension without paying income tax or CGT. This can be put into your holiday fund to add some activities to your must-see list.
Keep your income tax allowance
If you earn over £100,000, which includes bonuses, you’ll lose your personal tax allowance partially or fully. However, you can reclaim it and avoid tax on bonuses by paying it into a pension, which frees up additional funds to be used for things you want to do, such as going on holiday.
So, while there are lots of ways you can reduce everyday expenses to save for a holiday, reducing your tax liabilities shouldn’t be overlooked. With lots of options to help you afford a holiday without dipping into your savings, you can enjoy more freedom and fun-filled travel.
Time to get travelling on a budget
Hopefully, our budget travel advice will encourage you to enjoy the holiday you deserve in 2024, without worrying about your finances. Whether exploring the other side of the world or a staycation in the UK, don’t be held back by rising living costs when it comes to your holiday plans.
Image by Julius Silver from Pixabay
Please note this is a contributed post
