Very often, planning a big vacation often ends up becoming a large headache over expenses. Sure, you want to enjoy the experience as much as you possibly can, but at the same time, you don’t want to end up begging on the streets of Venice or Barcelona. Want to know the secret? Lionel Yeo shares some wise words on how you can do this:
Ok, people. Here’s definitive evidence that I am a hardcore nerd: I just paid a ridiculous amount of money to spend FIVE DAYS at the Wizarding World of Harry Potter in Orlando. Not only that, I’m also budgeting (yes, budgeting) for a $47 INTERACTIVE WAND that will let me perform MAGIC around the theme park. This October, watch me run around Diagon Alley, flicking my wand and yelling “Wingardium Levi-O-SA!!”
Overpriced? Yes. Unnecessary? Yup. Totally frickin’ awesome? Definitely.
As you know, I take a 2-week vacation every year, but this one feels different. Since I made my booking, I started seeing subtle changes in my mood and happiness months before stepping into the airport. Maybe it’s because I’m a closet Harry Potter nerd, or maybe it’s because it had something to do with how I planned my trip this year.
The research backs up my experience. On recommendation from a reader (Thanks Andreas!), I read Happy Money: The Science of Smarter Spending. The authors Elizabeth Dunn and Michael Norton used psychological research to teach us how to spend money in a way that gives us the biggest bang for our happiness buck.
Since I was already spending a huge sum of money on my vacation, the least I could do was figure out how to use it to maximise my happiness. Here are three things I learnt that could make you happier if you’re planning an upcoming trip:
1. Book Your Trip Early
Booking your trip early doesn’t just save you money, it turns out that it makes you happier as well. A Dutch study published in the journal Applied Research in Quality of Life (That’s a kickass name for an academic journal if I ever saw one) showed that the largest boost in happiness comes from the simple act of planning a vacation.
We were driven to plan for our trip early by necessity: The Wizarding World of Harry Potter had just opened in July, and so we booked our tickets early before other ravenous Potter zombies fans could devour them.
That turned out to be a great idea. By booking the trip early, I got to maximise the time spent anticipating the experience. I can’t tell you how many times I’ve re-read all 7 Harry Potter books since then (because that’s what all mature 29-year olds do) and thinking about drinking butterbeer. Mmmm.
2. Buy Time
Vacations can be stressful: Long lines, flight delays, getting lost, etc. But if you could pay for a way to minimise or eliminate these stressful activities, do it. Research shows that it could dramatically boost your happiness.
In Happy Money, Dunn and Norton advocate the principle of buying time. In other words, outsourcing the crappy activities so you can spend more time on activities that produce lasting effects on happiness.
After reading that wait times for the flagship ride Escape From Gringotts could stretch up to 5 hours(!!!), the girlfriend and I decided to spend a little more to stay at an onsite hotel. That gives us a precious Early Admission pass, which lets us sneak into the park an hour before it opens to the general public and head straight to the rides. (Assuming we can drag ourselves out of bed at 6am)
The added convenience could boost our happiness after the trip too: The same Dutch study above found that travellers who described their trip as “neutral” or “stressful” returned to their baseline happiness immediately after their trip ended, but those who reported feeling “very relaxed” enjoyed a happiness boost for 2 weeks after their trip.
3. Pay Upfront
Here’s a surprising fact: What we owe is a bigger predictor of our happiness than how much we earn. Several studies support this finding, including one showing that British households with more debt show exhibit lower levels of happiness.
So happiness research suggests that we should pay upfront for as many things as possible. Since knowing that you have to pay later is psychologically painful (think about how it feels to watch a taxi meter jump while you’re in a jam), getting it out of the way early can improve the pleasure of consumption.
A couple of years ago, I spent my spring break at an all-inclusive resort in the Dominican Republic. My alcohol-starved American friends and I spent our days at pool bars sipping mojitos and remarking how awesome they tasted “because they’re free!” (Some of the best moments of the trip came from my friends who took FULL ADVANTAGE of this – including an incident involving an elevator and a pool shower. Nuff said.) Of course, the mojitos weren’t really free, but because we paid for them months in advance, they tasted free.
A Rich Life Isn’t Just About Growing Your Money
Traditional personal finance bloggers will balk at the above points. They’ll say, “Pay upfront?! You could’ve made $2.58 in interest by paying later!!” Then they’ll wave a finance textbook menacingly at me while giving a lecture about the time-value of money.
True – paying later might make sense if your goal is to maximise your money. But should that be the goal?
You’ll notice that I don’t talk much about “keeping a budget” or “the intricacies of Medishield Life” on this blog. Because maybe a single-minded focus on growing wealth isn’t the point. Maybe we could use our money not just to get more money, but to get more happiness.
P.S: If you’re the kind of person who believes that money should be used to increase your happiness, level up your personal capital and live a rich life, sign up for my VIP list! I’ll show you how you can boost your savings AND your happiness at the same time.
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