According to the data from World Bank website Indian’s have spent nearly INR 13.8 Billion during the year 2011-2015 on abroad travel and the number is expected to rise in the coming years because of higher disposable income and lifestyle changes. With such an enormous spend on travel, it is very much essential for everyone to understand the necessity of careful and advanced planning while travelling abroad which includes choosing the right destination and arranging money without affecting the financial goal and in turn save money.

So here are the do’s and dont’s of how to arrange money for abroad travel in an efficient manner and save money especially when you are on a tight budget:

• Never borrow money by taking a personal loan: Holiday in a foreign country requires huge amount of money. For e.g. when travelling to Europe, a 3 member family would need around Rs. 3.5 Lacs, assuming 1.2 Lacs per head. So if you think of taking a personal loan, which is very easy to get but then you’ll fall under the trap of EMI. Personal loan interest rate which falls between 13%-25% will further strain on your wallet. And ideally personal loan tenure is minimum 3 years, so monthly EMI will keep on haunting you.
• Try to limit use of Indian credit card abroad: When you use credit card abroad although it protects you from theft when carrying cash then be careful. You should know various charges while using credit card abroad such as foreign currency conversion which is in the range of 1%-3% which further add up to the monthly bill. Read in detail on pros and cons of using credit card abroad and various charges.
• Do not use money from your investment products: If you are thinking of taking money out of your investment products then it would be a big mistake. This would impact you in the long run and returns would be on a lower side which will ultimately affect your financial goal.

So how can you save and arrange money in an efficient manner?

1. Plan Early: This is the most important tip for you. When you plan out 6-8 months in advance, you can get best deals on airfare, foreign exchange, hotel booking etc. And this can save you not less than 15% compared to the last minute planning which naturally turns out to be painful as the expenses for the above mentioned things increases as you get limited choices. Look for sites offering cheapest flight offers. And book your tickets on weekdays as airfares are expensive especially on weekends.
2. Give a detailed thought on various expenses: Your planning should also involve researching on various expenses required for restaurants, visiting attractions, internal travelling etc. For e.g. you should make use of coupon deals for food, make use of Uber deals for internal travel, if you are travelling in a group then look for bulk discounts offered especially by hotels etc. This way you can save decent amount of money.
3. Start investment especially into equity: Although such investments are subject to market risks and various other factors, when someone plans abroad trip starts 2-3 years in advance, then the return on investments from equities can help in generating good money and eventually you will have to save less every month. But if you planning period is short and you have decided to travel within a year then debt instrument is a favorable investment option although the returns would be less considering the short tenure, you will have to save more money every month. Other safe option is recurring deposit with any bank. Another way to invest in RD is through travel planning companies like SOTC, Thomas Cook and others who have partnered with leading banks. They have started various savings plan for people who are planning to travel. So if you save money in RD through these schemes then benefits would be as follows:
   • 13th month installment will be paid by the travel company
   • You will get discount by the company in addition to the interest
4. Do not use Indian credit card at ATM abroad: Using credit card for withdrawing cash either in India or abroad carries a charge. But when you withdraw money when you are abroad then you would end up paying higher and also affect credit score as banks might think that due to lack of funds you are relying only on credit card. Read tips on improving credit score in India.
5. Carry basic medications: You are always at a risk of health problems when travelling abroad. This can be due to change in food, weather conditions etc. So it is best to carry medicines for stomach infections, fever, headache and other common illnesses rather than visiting local doctors as cost of medical expenses are on a higher side compared to India. You can also buy travel insurance which will provide coverage for many things such as malfunctioning of electronic device, flight cancellation etc. Check out how to buy cheapest medicines in India.

With above mentioned tips you can save decent money during your abroad travel.