I just spent 5% of our household pre-tax salary on a vacation and I’m wondering if that’s too much or too little. Is that more than you spend? Less? Just throw out an upper percentage that you think is “permissible” and, if you want, give us an approximation your salary.
It’s impossible to say. It depends on too many factors.
For instance, if you make only $30,000 per year and have no savings, I would say that any amount you spend on a vacation is too much. On the other hand if you make $500,000 and have $5 million in savings, then I think you can get away with spending 25% of your income, or $125,000 on a vacation, if that’s what you really want to do with your money.
I never thought about putting a percentage on it. If I want it and can afford it I spend it.
What kind of vacation are we talking about? Is this your yearly trip to Disneyland/the coast/mountain cabin/etc.? Or is this a ‘once in a lifetime’ sort of thing (African safari, Amazon River cruise, or the like)?
We spent more than 5% of my salary last year on a 2 week trip to Washington, D.C and New York (from California)…but we don’t do that every year.
For us, it’s a once-in-a-lifetime vacation, but then again, we just did a similar one two years ago. But in any case, if you have to save for several years, just average it.
For those that can’t put a number on it, how about telling me what you paid for your last vacation, as an annualized percentage of income?
I’m with the “this is an unanswerable question” crew.
I’ve had years where my “vacation” took most of my salary- but I was young and broke and traveling for months at a time, so we aren’t talking a lot of money and I got a lot out of it. I’ve only had short hops for the past couple years, but that fits where I am in life right now. I’m sure soon I’ll be doing “family” vacations, which is another beast all together.
So it depends on how much disposable cash you have, how you prioritize travel, etc.
Two percent doesn’t sound too outrageous. Of course, it depends on lots of things. If you don’t have any savings and you’re loaded down with debt, then it is an outrageous expenditure. But if you are unencumbered and have a decent amount in savings, then it is fine.
Before I had a car payment, I probably spent that much traveling (including family visits). Now I can’t afford to do this annually. So I’m going to do a cheapie vacation in D.C this year and then try to do something more adventurous next year. Just as long as I go somewhere, I don’t mind.
I’d put vacation expenses under recreation expenses in a budget, not as a separate item.
My last big vacation in 2010 cost almost exactly 5% of my gross annual income that year. (This does include food, which I would have been paying for one way or another wherever I was, although it would have been cheaper to eat at home.) My personal budget allows 5% for recreation, so my usual recreation expenses like going to the movies on top of my vacation costs did put me over. However, I normally come in under 5% on recreation expenses, so it averaged out.
For a single trip, we’ve only spent that much a couple of times in our lives. (See Suburban Plankton’s post above for the recent one.) However, I would say that on average we spend around 5% of our income on vacations through out the year. That takes into account our annual Disney trip in the fall and usually a spring break vacation. Two adults/one teen boy + kenneling costs for two dogs.
0%
My employer should send me and my family somewhere nice for two weeks every year, and pick up the entire tab.
When I am the ruler of the Universe, I will see to it that my employer does this.
Something like Disneyworld would be around 30-40% of my salary. So for right now- 0.
I get paid vacation time, and since the last couple trips have been in the 2% range of both yearly income and yearly hours, I suppose that means that my employer did send me someplace nice and pick up the entire tab.
ETA: Geeze, I hope that paid vacation hasn’t become so uncommon that I’m stealth bragging with this. It hasn’t, has it? (For “career”-type jobs, I mean, not newspaper routes).
The cost of your vacation should be based on how much you have saved, not your annual income. After known expenses are covered, all debts are down to budgeted levels, money saved for retirement and college funds and the like, and some money is put away for emergencies, you can vacation with the rest. It doesn’t always work out that well though.
5% seems about right to me. We take multiple vacations a year, the sum of which is about 5% our household income.
I knew someone in grad school who had perfected the art of getting the department’s student travel budget to cover his trips to exotic locations. Officially he was attending conferences and getting ideas for his research, but the majority of his time on trips was devoted to outdoor activities (skiing, surfing, or hiking, to name a few).
5% sounds like a bit much to spend every single year, but if you were to spend say… 10% of any one year every 4 years or something like that, it wouldn’t be so bad.
In other words, 2.5% annually saved up and spent in the 4th year.
So if you made 48000k, you’d save 4800 bucks at $1200 per year ($100 per year, or in my case, $50 per check), and go on a 4800 dollar vacation at the end of it.
I think that’s entirely reasonable, assuming you want to go on a big vacation every few years.
Or, you can go longer and either save less per month or save up more if you like.
Our last trip (Belgium/Netherlands) was probably about 7% of my annual salary, but it was our first trip in 4 years.
My (internationally focused) grad school basically gave every grad student a no-fee ticket to an overseas destination of their choice to conduct at least a month of research. I’d imagine all of us did some tourism before or after our research commitment. I spent three months doing research in South Africa, and another month traveling around Zimbabwe and Zambia. Indeed, the possibility of exotic air tickets is a big part of why I chose the field that I’m in. It’d be a scam if I weren’t doing my work, but there is nothing wrong with tacking a vacation to the end of a work trip.
Another question- what is a vacation?
Is it a vacation when I fly back to California to see my family for Christmas? If so, that’s a pretty big bite right there, every year. But I think of it as more of the cost of living, not much different than paying rent or buying subway tickets. It’s something I have to do because I live where I live.
If your bills are paid and you and your family have necessities (and I realize that the definition of “necessity” is different for every family), you can spend as much or as little as you want on a vacation.
I guess I can play, my last one cost about 8K. That’s about .6%, so cheap I guess.