I often find in counseling that many people, not having any savings, have people who still have serious credit before retirement for 10-15 years, but there are two sure points in family life, winter skiing and summer beach vacation, HUF 2-2.5 million.
These are the two fundamentals in the lives of so many families that build their year-round spending money, even at the cost of living on and off credit and with no savings.
Not only are you financially in trouble when you are borrowing credit
But even if you do not have loans, you do not have any visible savings 10 or 15 years before your retirement.
Many people are deceiving themselves. Most people record their savings and loans in separate parts of their minds. She blames herself for setting aside money for this holiday during the year, so it is not irresponsible for her family to spend a million and a half every summer. Meanwhile, she has serious debts in her apartment, her car, and even her credit card, so she goes on vacation every year on credit.
If you have loans and you spend money on vacation, you are on loan, no matter what you think. Because it is completely irrelevant that you borrow your car to “save” your vacation for the year, or pay directly for your vacation with a credit card, or you may have been scrolling through your credit card debt for years to go on “cash” vacation.
Although many do not believe it
They pay a very high price so that if they break, if they break, they can go on vacation.
If you spend only $ 1.2 million a year on holiday (which is not that much for a family of four or five, especially if the beach is the destination during the high season), then $ 49.2 million over 30 years, also today if you are above inflation two percent of your savings.
If you are on average 22 years old or retired, you would be able to supplement that pension with $ 231,000 a month, also at today’s value. Ask yourself the simple question of whether you would need this amount as a pensioner. If the answer is clearly no, because you will live without it in your old age, you can safely spend that money.
(If you do all this while still having loans, then not counting 2% above inflation, but the interest on your loans, because the money you spend each year could be used to pay off your loans and you would get rid of that interest rate. with a 10% personal loan above inflation, we would be talking about $ 208 million today. You could pay a pension of that million for the rest of your life.)
And I know the cries of “but we only live once so I don’t deprive myself of it” and “it takes me a year of hard work”.
Nobody told you not to go on vacation
But go where it runs from your budget . I talked to a travel agent these days and said two interesting or rather sad things. One is that as people started to look a little better over the past year or two, money started to burn their pockets. Little people pay for a Dominican vacation, selling more trips by May this year than they did two years all year. (That’s why a foreign trip last minute costs as much as the normal price for two years. Demand has pushed prices away.)
The other thing he said is that many travelers hump all year round to live in an all-inclusive hotel for a week just as they would in a dream all year long. But then he comes home, and the next day he has to wonder again what sort of utilities to pay in the mail that month.