How much would you want in your savings before spending several thousands on a trip?

[Croissantsfordinner]

We have just bought our first home and will be spending the next year or so revamping our savings are the recent big expense.
DS is due to start school next year so our childcare bill will be significantly lower and we were hoping to save to go for a big family trip at some point in 12-18 months (US or Asia), likelihood is that we'd be spending between £5-6K between the 3 of us between flights and accommodation etc.

How much money would you want to have in the bank before feeling "enabled" to spend such amount on a trip? I wouldn't have thought twice about it many years ago but being almost 40, with a mortgage (and a big one as we are in London) and a DC I now wonder if we shouldn't go.

But then... you only live once and all of that and traveling is a big passion of ours.

Consider if you can make the most of having a house now. House swap or Air bnb it? I have a friend who travels frequently and part finances it in these ways.

I wouldn't rush for the big trip at this age either - but I'm a pessimist and the signs in what I do are all bad for this year and people are expecting lay offs/work drying up.

I’m not sure £5-6,000 will get you a holiday in America. We did a 3 week family trip to the west coast and it cost nearly that amount each (and we seriously did not splurge, stayed in the cheapest possible accommodation, didn’t go to expensive restaurants, skipped on theme parks etc. America is quite expensive once you’re there).

But to answer your question about how much savings- it depends upon whether you have income protection insurance and which circumstances that covers + for how long (as I’m guessing being unemployed for a while is what you’re mainly thinking off). If you have no income protection insurance I’d say make sure you can cover at least 6 months.

@Urghhhhhhh DS is 4 but as mentioned the trip would be more in 12-18 months to me so closer to him being almost 6 yo

@Croissantsfordinner ultimately you look to be in a decent financial position but I doubt your ds will remember it even at 6, but if you and dh want a more exciting holiday you don't need to justify that, you sound pretty sensible about money. We've certainly done expensive holidays because we wanted to and didn't regret it!

We’ve just spent 20k on holidays this year & tend to save about 60k per year, so by that reckoning, 15k.

Unfortunately we didn't have that prior to his injury and now because of his injury we have to wait for a certain number of years before he can get it other than for broken bones. I do have it for myself now though

I’d say six months mortgage and expenses, plus consider those one -off bills post six months (car tax, Christmas etc).

So many variables!

Personally I want 6 months living costs saved at all times, and that is a minimum. I have more like 10 months at the moment which gives me some comfort. The financial provision for the family falls to me and I have no bail out options via partner or family. So that makes me risk averse. My industry is a bit uncertain right now too!

My partner is very different and would put a holiday on a credit card. So you and your partner need to get to some agreement that works for your circumstances.

Life is short. We have holidayed with no money in savings. We have income protection insurance, admittedly parents who would step in and loan if we got in a perilous situation, good pensions, secure jobs. I'd be more scared of something happening and not being able to travel rather than something happening and struggling with bills, as I can flex the second part, COVID is a good example.

@ahdlfj you are lucky to be in that position though - we have zero financial help from family and in fact we have to sometimes support them with some occasional expenses (for example fixing things around the home etc)

Enjoy life, take a medium term look at money, the early years of our marriage were very travel lite then the kids came and it didn't get much better.

That's what I get for reading without glasses! I thought it was a 12-month trip. I was very impressed with your low travel but a friend of mine has just done similar and any costs them eight grand for a family of four for a year in Laos and somewhere else other than way. 😂

Very similar situation. I'm your age, DH in fifties. Youngest DC due to start school in Sept so that's a financial relief, but only just bought our house 2 years ago. It's needed more doing on it than was obvious when buying it.
We haven't had a holiday abroad for 7 years and we've been wondering if we can manage it. Sadly, for now, we've decided we can't

Husband and I are mid 30s with one little boy and very much in the life’s too short camp. Currently sitting in the Maldives despite having moved and upped our mortgage considerably at the end of last year, to a house that needs £100k worth of work doing to it. £30k in savings which if we cut back would cover 7-8 months of expenses that we won’t dip into for renovations. When it came to paying the balance in November I wobbled slightly at what it could do to the house (which in hindsight was literally a bathroom 😂) but having seen colleagues of my husbands drop dead at 60 without having the chance to enjoy the million+ pension pot they’ve accrued, it’s changed our perspective a little. Do whatever you feel is right, you’ll work out what feels comfortable for you.

You sound very sensible and obviously prioritising the right things. We set our savings into separate pots/accounts, which helps us rationalise spending on big holidays. So we have an emergency instant access account which we save £500 a month into and always aim to have 4-6 mths of bill (mortgage, energy, food, council tax) in case of a job less etc. We then save into a long term isa about £250 for kids uni fees or a house deposit for them. We then have medium term goals like holidays and cars and save £400 a month into that account, we can spend all of that on medium term luxury items without feeling guilty, but also, once it's gone it's gone! It really helps us budget but also enjoy our money. So I'd sit down and work out how much you can save each month, then break it into groups that make sense for you and prioritise what matters, so if you need to build an emergency fund prioritise that first, then think about long, medium and short term goals and how you split your saving each month into those goals.... bonus points for finding good high interest accounts to use.
I wouldn't worry at this stage about paying off your mortgage, once our emergency fund hits 12 mths of emergency money we will start overpaying the mortgage to the same degree we were saving, but for now it isn't our priority as we want to enjoy our money when the kids are young and travel is really important to us.

Ideally- like 6 months of all living expenses?
Or at least 6 months income for one of you. Imagine if one or both of you got in a car accident etc or fell down the stairs tomorrow and couldnt work for weeks or months on end, what would you need to manage your bills.

@Onlyvisiting income protection and/or critical illness insurance? As well as employment policies.