Done By 60: Two Travel Chapters, One Spending Bucket


If you’re approaching your post-career decade (the swinging 60s), you might already be mapping out your desired locations and planning trips to those places. But before you start booking flights, there are two moves you can take to ensure you’re stretching your travel dollars to the limit during the decade when you’ll appreciate it the most.

Create Two Travel Chapters

Most retirement income replacement calculators assume that one’s spending will last indefinitely, and roughly at the same level it is today. In other words, whatever you’re spending on property taxes, insurance, and groceries, for example, will just be projected forward (with an adjustment for inflation). But do you really think you’ll want to travel in your 80s as much as you will in your 60s? Perhaps. Since health spans aren’t keeping up with lifespans, you may not have the body and the energy to be as adventurous at 85 as you could be at 65.

One of my baby boomer clients (a huge adventure traveler) had a couple of mild health scares, so we both felt it was a good time to see how much more he could spend on travel in the decade after he ends his full-time career. We discovered that he could increase his travel spending by more than 30% by breaking it into two chapters. For example, a person who intends to spend about $18,000 per year on travel could instead spend $24,000 for the window between age 60 and 75 as long as he’s prepared to dial it down to something closer to $12,000 once he hits 75.

Create a Travel Spending Bucket

As I wrote in The “B” Word, I’ve never been one to maintain a detailed budget. I find that many people need the opposite of a budget – a system for ensuring that they’ll actually spend more, not less. For expenses that aren’t fixed, such as travel, an easy way to do this is to create a “spending bucket.”

To start, link a new savings account that is specifically earmarked for travel and set up an automated monthly recurring transfer to it. Then reimburse your checking account when you travel. This only works if you promise yourself that this money can only be used for travel experiences. I sort of rolled my eyes at this idea and then I tried it. Now I’m absolutely loving it. I forget the account is even there throughout the year, so it feels like free money when I’m planning a trip.

On a related note, I recently fell in love with the Chase Sapphire Reserve card. It has a hefty annual fee but it’s all about the value net of fees, and this card has that in spades. If I use the card properly (spending on things that get me the highest amount of points), I estimate I’m getting more than 4% “cash back,” as long as I use the points to book flights. Oh, and the initial sign-on bonus paid for my flight to go scuba diving in the Philippines (I’m probably there while you’re reading this). If you plan to travel more in the near future, you might as well find a credit card that rewards you well for doing so.

Happy travels,