One important vacation essential is to start preparing for your trip well in advance in order to make it a success. Whether you are planning a once-in-a-lifetime pilgrimage to an exotic destination or scheduling the family's annual summer trip to a theme park, every detail counts.
This includes preparing financially and building your vacation savings - perhaps with a certificate of deposit (CD) - to make the most of your vacation. Besides, who wants to come back from a trip with loads of debt to pay off?
The First Step in Your Planning Your Vacation
Creating a budget will help you figure out roughly how much you want to save for your vacation. Start by accounting for the cost of getting to your destination. Next, figure out where you are going stay and for how long.
And don't forget to estimate the costs of food, fun and extras such as souvenirs and gratuities. Depending on your needs, your next step won't necessarily be to open a certificate of deposit (CD) or other savings account. You may want to weigh your options first.
Choose the Best Saving Method
When it comes to where you put your vacation savings fund, you have several options, including which bank you'll trust with your money. If you pick Ally Bank, we think you'll be happy with your choices:
Interest Checking Account - You can save within your checking account if you make sure to keep track of how much you are saving each month, or open a separate account strictly for your vacation fund. That way, you won't accidentally spend it. Either way, the Ally Interest Checking Account offers you a number of other features that could make staying in control of your money easier.
Online Savings Account - Opening a separate savings account allows you to separate your vacation money from your everyday funds. Or, open both an Interest Checking Account and an Online Savings Account - then set up an automatic transfer each week or month from your checking account to your Online Savings Account.
Money Market Account - Just like the Online Savings Account, but it gives you the flexibility of debit card access (with no monthly fee to use your debit card) and a number of other features that help you make the most of your vacation savings fund.
Certificates of Deposit (CDs) - CDs typically help you save more, faster, as they usually come with higher interest rates than other options. You can open an Ally Bank CD for a specific time period, called a term, that ranges anywhere from a few months to years, and the fact that most CDs have early withdrawal penalties helps you stay committed to your savings plan.
Finally, you could even start with one method - a Money Market Account, for example - and then transfer the money into an Ally Bank CD once you reach a certain amount to both maximize your interest and protect your funds from the temptation of impulse spending. Moreover, Ally Bank CD rates are some of the most competitive available according to Bankrate.com, and with daily interest compounding, your vacation fund grows faster.
The Problem with Using Credit
Using a credit card to pay for a vacation isn't always the best option. Once you return from your trip, you will have to start paying it off, possibly at a high interest rate. Instead, create a budget, and then build a savings plan with your vacation in mind. Saving as much as you can before departing just makes your vacation more of what it should be - a chance to reward yourself for working hard the rest of the year.
Wherever you're planning to spend your next vacation, Ally Bank has ways to help you save up the money you need to get there. With an industry-leading Web site and some of the most competitive interest rates available according to Bankrate.com, Ally Bank works hard to live up to our name. Get the scoop at AllyBank.com or call live, 24/7 support at 877-247-ALLY (2559) today.