How to Budget for Money Wasters on Your Vacation

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Vacations are a time to let loose, live it up and, yes, even blow a little cash. But keep in mind — it’s one thing to spend $100 on a fancy dinner and another thing entirely to spend it on traffic tickets, which is exactly what happened to me and my husband on our recent trip to Italy.

After making a wrong turn onto the Autostrada, we passed through a toll booth, not realizing we were supposed to take the ticket waving discreetly from the machine. As soon as we pulled up to the next toll plaza, an irate man in blue pants stepped out and proceeded to photograph the license plate of our rental car and issue us a big, fat ticket for 57 euros, or $64.42.

As if that wasn’t bad enough, we found a parking ticket (another $30) tucked under our windshield wiper a few hours later. “It’s not a big deal,” my husband said half-joking. “Besides, it’s not like they know where we live.” But knowing the rental agency could easily turn our information over to the authorities — and that ignoring a ticket, at least in the U.S., could ultimately hamper my credit — I wasn’t about to take any chances. I resolved to suck it up and pay the fines when we got home.

What a Waste

You may argue spending money on tickets isn’t a wasted expenditure but one due to sheer negligence. To which I’d respond, “You’re totally right. But I still didn’t want to spend the money.”

After being hit with not one, but two tickets in Italy, I’m prepared to start budgeting for costs like these on future vacations. Why? Because every time I venture somewhere that the customs are different, I put myself at risk for doing something incredibly stupid. And if you’re a budget-conscious traveler like me, you might want to consider doing the same.

While there are no hard and fast rules for how much money to set aside, you should take some factors into consideration. Are you renting a car? If so, bone up on the local rules of the land and prepare for the worst. Planning to party? By all means set some money aside for wherever the night takes you. And so on it goes.

You can set aside extra cash before your vacation by cutting out unnecessary expenses like morning lattes. And you can put bonuses or unexpected cash toward your savings. Another option is putting those unused credit card rewards points to use to cover major costs, such as hotels or airfare.

Remember, no matter where you’re headed, it pays to keep your credit in tip-top shape and be careful not to rack up debt, which could ravage your credit scores. Keep an eye on your two free credit scores, updated each month, on Credit.com.

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3 Calls You Should Make Before Heading Abroad

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So you’ve booked the flight, packed your bags and set your away message. But have you taken the time to ensure your credit card, debit card and cell phone will work abroad? If not, put it on your to-do list, because nothing puts a damper on a vacation quite like not having funds or phone service — or dealing with fraud.

Over time, issuers come to know your spending habits, so any time a purchase deviates from the norm — say, making a large purchase on a card used for smaller transactions — a hold could be placed on your card. Worse still, if a scammer manages to get a hold of your card, there’s no telling what he could do with it.

With those factors in mind, here are three calls to make before heading abroad.

1. Your Credit Card Issuer

Like any personal information, you want to keep your credit card secure. The best way to do that is by letting your issuer know you’ll be out of the country. Not only will this prevent a hold from being placed on your card, you’ll get an alert if something suspicious comes up — that is, if you’re signed up for push notifications.

2. Your Bank

Whether you plan to pack your debit card or not, let your bank know your plans. After giving them the dates, ask to set limits for daily ATM withdrawals and in-person transactions. You may need to access hundreds of dollars in funds each day, but there’s no reason the limit should be in the thousands. Find out where the levels are currently and adjust them accordingly. While the bank may replenish funds lost to fraud, you don’t want to deal with an overdrawn account.

3. Your Cell Phone Provider

The only thing worse than being out of touch? Getting hit with roaming data charges. Do your wallet a favor and ask your provider if it’s best to keep your phone on Airplane mode or spring for an international plan. You can often arrange a plan to only cover a trip.

Remember, even if your credit and debit cards work abroad, you don’t want to go overboard with spending. Experts recommend keeping your balance below 30% — and ideally at 10% — of your available credit limit as to avoid exceeding it (this can damage your credit). To see how your spending is affecting your credit, view your two free credit scores, updated monthly, on Credit.com.

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