Tuesday, 11 December 2012

How To Save For A RTW Trip

Once you have made your mind that this is 'it', you're going on your round the world trip, your mind flips a switch. Suddenly, all your energy is focused on that one goal and all other things pale in comparison to this all-encompassing dream. Reading numerous articles on how much money we need I've given ourselves a generous estimate for around $70 per person/day for our 6 month trip around the Americas which means we are needing around $26 000 for the entire trip. However I also want to give ourselves some breathing space for when we get to the UK so we don't have to scramble to get jobs (I hear the economic climate there isn't that great) and also some money tucked away for when we get back and move to Melbourne. Just to make sure that we had as much money and hence freedom as possible to avoid any sticky situations we may find ourselves. 

We're not going to be living luxuriously by any means, our accommodation will be mostly hostels but not the dingiest, cheapest one we can find. Also we will be eating comfortably and doing as many cool things as possible - like the Galapagos islands. It is a once in a lifetime trip after all. It may seem excessive but I'm thinking $100 000 for the two of us will be more than plenty. So here are some tips on how to save a big wad of cash and get rid of your things in one go:

1. Obvious one - put your savings into a high interest account, you could be making at least $200 a month. Also makes it harder for you to take money out of it. I'm with Bankwest. Make a budget so you can project how much you will need for necessities and squirrel the rest into your savings account.

2. If you have a lot of clothes and knick knacks like I do, start early (I gave myself 10 months) and list them up on ebay. Put some effort into making your clothes presentable by taking lots of photos, putting up measurements and a description and posting items out quickly. Know the value of what you're selling. I would research similar items and list it as a 'buy it now' close to that price. If it doesn't sell one month, it's bound to sell in another so don't be disheartened. I had a 30% success rate each month ie. if you put 30 items I would sell 10 of them. I have now sold over 60 things and made $4000. 

3. Have a garage sale. We joined the 'Garage Sale Trail' in May which was a Sydney wide event. Lots of free advertising, more people, better success. What's junk to you might be worth something to someone else. Be reasonable with your prices and try to selling most things for around $5-10 as most people aren't going to want to spend a lot. We made $600.

4. Get creative and make something. I don't necessarily want a second job but I want to try to earn some extra cash on the side (as well as have some fun doing it) so I started making terrariums and necklaces to sell at markets. It's not that much extra cash but it's also is a fun activity that will prevent you from getting bored and spending money as well.

5. Don't go shopping. Duh! You're going away, make do with what you've got and just avoid shops altogether so you don't get tempted. 

6. Get value for your money.  I love David Jones yoghurt but its $9 a tub, so I use David Jones gift cards that people have given me and I also get them to leave the lid off so I  get some extra and sometimes an hour before they close they sell them for half price. Enjoy life but be smart about it.

7. Be frugal, not stingy. As much as I want to save, I don't want to do it at the expense of spending time with my friends so I'm happy to spend money on dinner nights out. But occasionally I'll suggest a night in at our place with a movie and a homemade meal. Just as nice and a bit cheaper. We try not to go to swanky places that would cost more than $30 per meal.

So there's 3 months til the trip and we're just about to hit our 100 K goal. Hurrah! It's our life savings but it'll be worth it. You only live once!

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