Saving for Long Term Travel

The most common question we hear is, “how can you afford to travel that long”?! Well, we’re not rich. Rich is the point at which your money works for you, and we work hard for our money. We saved like crazy, and now we’re fortunate enough that we can travel and return with money saved. This is a quick blurb on how we each got there.

Michael:

I left college in 2014 with $9,000 cash to my name and just as much student debt. My plan was to get a good job, pay off the student debt, earn a professional engineering license in four years, and then travel. That didn’t happen. However, I did land a great civil engineering job taking me from Austin to San Antonio to earn $55,500 before overtime. And let me tell you, there would be lots of overtime. I planned to save by focusing on taxes, credit cards, and cash savings. Savings I had down, but taxes were a foreign concept I had to quickly understand.

I could’ve gone anywhere after my first day at work, but I went straight to H&R Block for a tax chat. Oh yes, I was Mr. Cool. A tax specialist sat me down, heard me out, and insisted that I aim for a $0 refund. He pointed out that tax refunds feel great, but consider what they are: A refund is given after paying too many taxes in a year. The IRS is returning your excess payments that you could have kept. That’s why a $0 refund remains an annual tax goal of mine, and I still visit that specialist every February. A tax goal helped, but I had to target daily spending. Better yet, I wanted to get rewards for spending. That led me to (hold on tight Dave Ramsey!) using credit cards for everything.

I chose a Chase Freedom as my first credit card. The plan was to gradually acquire Chase credit cards, hit sign up bonuses, and use points for travel. I later learned this is called churning. From 2014 to 2023 I charged everything to a Chase card because points gained on one Chase card transfer to others at the same value. I’m now starting long term travel with over 500,000 Chase Ultimate Reward points for flights, hotels, and other discounts. To be clear, I never carry credit card debt. Ever. Credit cards are terribly easy to misuse so do your financial soul searching before committing to one. When used responsibly, they’re essential travel tools.

A tax goal and using credit cards responsibly helped me reach my travel goal, but general savings was another key. I chose an Ally Bank savings account to help my cash grow on its own. That account generated 0.9% interest in 2014 and now yields over 4.2% (as of August 2023). I’ve earned years of small but consistent passive income at a rate 20x higher than Chase savings. My savings priority was to kill my student debt and then send anything leftover to my Ally account. The student loan was paid off within a year and I was off to the races on cash savings! But there are other forms of saving besides hoarding cash. Owning a home didn’t interest me. Kids in my 20s felt too early. I was happy to purchase a new used car. I never wanted the newest tech. I stayed frugal and didn’t spend on anything outside travel, food, and gifts. Holding that frugal mindset made the biggest difference to hitting my financial goals for travel.

Chandni:

My money saving journey started at the age of 12, when my dad convinced me to start reffing soccer games. Soon, when I went to the movies or to buy a gift for my friends, I was able to use my own hard earned cash - which meant I never had to ask anyone for permission. I learned very early that money = freedom.

Fast forward 10 years. After multiple summer jobs, engineering internships, 2.5 years working as a Resident Assistant in college to pay for living expenses, I realized I didn’t want to enter a work force and stay there for the rest of my life. Consider it an early quarter life crisis (because I’ll later have a true quarter life crisis). I convinced my parents to let me spend the summer working as an au pair for an Italian family, earning a little cash during the week, and exploring Sicily on the weekends. It. Was. Marvelous! I learned #1 that I could afford this trip because I had saved and worked through college, #2 I only needed like $200 a weekend to really see the country, where I had originally thought that travel was horribly expensive, and #3 I loved long term travel. It was the truest form of freedom I had ever felt, and I knew I had to figure out how to get back to it after the summer ended. Learning how to save for it would be essential.

I landed my first job outside of college in San Antonio, at the same place Michael works at :) Actually, across the cubicle from where Michael used to sit. We’ve worked hard and long hours, but have always remembered that we are more than our jobs, and have never forgotten why we work: to live a life that’s meaningful to us. In 2017, he refused to hang out with me until I set up a 401k and IRA. I had 2 friends in the city at that point, so I pouted a little, then set up automatic payments and moved on with my life. Will forever be grateful that he was looking out for me before I even knew what to be looking out for.

In 2019, I discovered a podcast called Dough Roller by Rob Berger. His shows introduced me to the concept of F.I.R.E. (financial independence, retire early), something that seemed like it was invented purely for me and my soul. I maxed my 401k and IRA contributions each year after that, signed up for a health savings account (and invested that money immediately), and listened to hundreds of hours of Mr. Berger showing me a path to make long term travel a reality.

Michael and I are pretty simple humans. We’ve taken most of our vacations during off-season; we’ll deal with a little rain to catch a $450 round trip flight to Spain. We take a lot of road trips and camp in national forests or sleep in the back of the car at a rest stop. It hasn’t always been the most glamorous life, but by investing and saving more than 50% of our paychecks, we’ve saved up $40,000 each to explore as much of the world as we can.

We’re both open books on our past financial journey, and how we plan to budget for this trip moving forward. If you have any specific questions, thoughts, wanna talk about a concept you’re interested in, please feel free to comment below and let us know!