How do you handle vacation spending? (Rule 3)
I'm curious. How do you handle spending while on vacation in light of Rule 3 - Roll with the Punches -- AND in light of monthly/seasonal/annual budgeting review?
My conundrum is this: I assign, say, $200* for a trip to visit friends in another city. I spend $100 on airline tickets, $50 on food, $25 on coffee, and $25 on souvenirs. But while I'm there, I pick up a book on sale for $10. So I spent $210 on my trip (oops) and assign all of these transactions to my vacation category.
Meanwhile, in my "real life" categories**, I have a $100 assigned for food, $50 for coffee, and $20 assigned for books. So should I simple re-assign $10 from books to my vacation category? Or from food or coffee? Should I move my $10 book transaction to my book budget? Do I move any food or coffee transactions instead? I don't know what to do...
To further compound the issue--I don't know how to record, categories, and note these transactions to best help me assess my vacation, food, coffee, and book spending at the end of the month/season/year. Is it important for me to know how much I spent on food in total throughout the year? Is it more important to know how much I spent while on vacation? Is it important to explore how much I spent on food *while* on vacation? Depending on the answers to these questions, I would need to categorize and note the transactions differently. (I hope this makes sense so far.)
In light of all of these questions, I'm curious: How do YOU handle vacation spending? How do you record transactions, adjust your assigned amounts, re-categorize, and keep notes?
*Numbers are made up for this example.
**Also made up numbers.
I don't take vacations that involve travel/spending money, so I don't have a "what I personally do," but there seem to be two lines of thinking.
1) I want to know how much I spend on vacation, and how I spend on vacation is not how I spend normally, so everything goes under vacation. This helps me plan for future vacations.
2) I'm really just keeping on top of my budget, but I do different things on vacation, so I'll mix the expenses between regular categories for the stuff I usually do and keep the vacation category for vacation-specific things.
There are probably others, and/or other reasons for doing things either way, but I think those are the more common ones I've seen around here.
Almost everything I spend while on vacation goes in the vacation category. I don't want vacation dining and entertainment to impact historical tracking for those categories in normal months. If I had to buy a phone charger because I lost it while on vacation, I would use my normal tech budget. If it's a grey area, I'll usually put it in the vacation category.
My goal when going on vacation is to have enough money saved up to cover the whole vacation with a buffer so that I can focus on vacationing and not on budgeting. I look at the transactions and scrutinize the categories when I get home.
It is definitely an interesting area of budgeting. Generally, we put all of the vacation spending in the vacation category. Eating out on vacation is different than eating out while not on vacation. We recently had an interesting one in that we did a staycation that was focused on playing golf in the local area. We went about an hour out of town each day to different courses. We put this cost in vacation because it was a vacation activity and not part of our regular golf category (yes, we have a golf category - we spend quite a bit there as part of our fitness and social activities). But if I bought something that I will use in regular life and is not vacation specific (like the charger or a book), then it would come from the category it would belong to such as tech or movie/books.
We have only one vacation category. We do not split by the activity. When we do our annual review and estimate our travel/vacation, we do estimate by the trip and then fund it based on the monthly required amount. Say, we estimate $6,400 for all trips, we contribute $800 per month.
This is definitely a no right answer kind of topic! Some folks do all of their saving and spending in one vacation category. Some distribute funds out to their regular spending categories when the time comes.
Some have fun tricks for adding memos to easily search transactions that happened on certain trips!
I like to keep it simple and do all of my savings and spending from one budget category (though I do use the memo trick)! If we overspend, I do typically pull from categories that those expenditures might have fallen under during a non-vacation time first.