Friday, March 25, 2005

Planning a travel, frugally

I haven't posted much recently and there are some reasons for that, you’ll understand why in a few seconds.

First, let’s talk about my retirement plan and financial progress. The current "quarter" has been a tough one, with stock markets going down recently and, particularly, I have been hit hard by a single stock which has been going down nearly 25% since January. As this stock makes 20% of my stock portfolio, I’m bleeding! Stay tuned for my quarter report in a few days :)

I also filed my tax, and I’m rather happy to see I’ll get a modest unexpected refund (about 800$) despite investment incomes and capital gains realized in taxable accounts.

But what has drawn my attention recently away from this blog is a travel I’m planning with my girlfriend. Next summer, we’ll be going to Europe. I’m dying to be there right now!

But such a two-week travel is rather costly, particularly at the time of the year we’ll be there (summer, during an important festival) and in an area known for its high cost of living. As I don’t want to hurt my retirement plan, I have to set a modest budget for this travel, but on the other hand, I want to enjoy it fully. Our total budget is 3800$. Our plan so far:

  • The initial reason to be there is that I’m going to present a paper in a scientific conference. Also, some of my expenses - those occurring during the five days of the conference - are paid by an university which was part of the project. My girlfriend and I will split the total travel cost in two halves (otherwise, she wouldn’t be able to come with me and I think it is fair anyway).
  • We’ll need passports, $75 each, total $150.
  • We have booked seven nights in a backpackers hostel, private room $60 the first night, $90/night the next five nights and the seventh is free. Total = $510. I’ll try to have the university refunding half the price of the room for six nights; this will allow us to save $255, thus, real cost should be $255. We don’t mind sleeping in youth hostels, we actually enjoy this since it is a great place to meet people and you can cook some meals
  • My plane ticket is paid by the university. The other ticket will cost about $900.
  • We plan to cook most meals at the hostel. We surely will have some meals at restaurants, and, fortunately, the kind of place we enjoy the most are places frequented by students and young people who generally don’t have much money to spend on a meal and thus are cheap by nature. We surely will enjoy local specialties in a fine restaurant once or two times. Some of my expenses (occurring in the 5-days conf. time frame) will be refunded, we'll have two meals on the plane and there is a free dinner on Sunday at the hostel). Total budget for the 13 days: $600. I think this is the slot where we save the most compared to what people would normally spend.
  • We have yet to decide where we’re going for the remaining five nights. But we are likely to lodge in cheap hotels (maybe youth hostels) . Budget: $500.
  • We will buy rail passes that allow us to take the train as much as we want during our stay (and trains rock in Europe). We’re going to use it A LOT, even if we’re staying seven days in the same city. There’s a lot to see in the near area; one hour ride is enough to get to a new interesting location. We’ll be going farther during the remaining five days. Total cost: $560.
  • I own a digital camera (which not only can take pictures, but also DVD-quality short movies) and will have my laptop with me, so that I will take as much photos and movies as I want for free. I will only print the most interesting ones. I also have a DVD writer and I will thus burn a souvenir DVD. Cost: 1 DVD $0.25, about 25 photo printings of different sizes. Total: 25$.
  • Total $2890. We have $810 left to spend on extras: souvenirs, gifts, some great bottles of alcohol to bring back home, taxis (we shouldn’t have to use them much, our hostel is next to the train station and the rail pass allows us to use most local and commuter buses), and entries to museum and the like. I hope it will be enough; we’re not the kind of people that bring back one million of souvenirs and we prefer walking in a city to discover it than paying for a guided tour.

Now, I have to find $1,900 so not to hurt my retirement plan (stick to your plan!) and I have four months ahead. Here’s how I will do that:

  • We'll save two weeks worth of groceries, my share is $100. I could add to that other small savings on expenses we'd have if we were to stay here (gas, electricity, restaurant...), but these are not significant amounts. Yet to find: $1800.
  • In my monthly budget, I put aside $100 for one-shot luxury items (which include travels and other non essential items that from time to time I will want to have). Unfortunately, I’ve been doing that since January only, I only have $300 in this piggy bank. In four months, however, there will be $700. Yet to find: $1100.
  • I also put aside $30 a month for smaller vacations, usually to pay for the gas and other small expenses when we’re visiting friends or family outside of our town. There is $350 in this pig bank; I will take $200 from it. Yet to find: $900.
  • We use to lunch each Sunday to the same restaurant (and btw we always order the same thing, sounds boring but it is actually not). We’ve been doing that for years. We’ve decided that we would not be depriving ourselves too much if we only go there once every two weeks (particularly since we’re going to do that for an exciting reason), for the next four months. I will save: $100. Yet to find: $800.

    And now... and now... I told you at the beginning of this post I was to get an unexpected tax refund of about $800, didn’t I?