Dreaming of an epic holiday? One that's bigger than your regular two weeks in the sun and feels more like a bucket list adventure? Maybe you're picturing a big bash for a milestone birthday, or perhaps you're longing for a year-long sabbatical to travel the world.  

Whatever your dream holiday looks like, you’ll probably spend a lot of time crafting the perfect itinerary. Thinking of all the things you want to do is the fun part, but it takes financial planning to make it happen. 

Step one: define your travel goals 

First things first, what does your dream holiday look like? Is it a multi-month cruise for the big five-oh? Is it taking a year off work, putting your life in a big rucksack, and exploring South America? Is it living in Japan for a year? Maybe it’s just an incredibly luxurious fortnight in the Maldives – business class flights and all!

Whatever your goal is, define it clearly. Think about when you want to take this holiday – if it's a good few years away, you'll have more time to build your holiday fund. This is the starting point for your financial plan. 

Step two: estimate the cost 

Once you have a good idea of what your dream holiday looks like, it’s time to crunch the numbers. This should include everything – airfare, accommodation, food, local transportation, visas, currency exchange fees, activities and any other miscellaneous costs.

If you’re planning years in advance, you might even need to take inflation into account and increase your budget accordingly.

Step three: set a financial goal 

Now you have your targets, it’s time to work out how you’re going to make this happen!

If this is a big holiday in the far-flung future then you might have years to work towards it. Maybe your total holiday cost works out at a round €10,000 and you want to celebrate a milestone birthday in five years. That means you know you need to put aside €2,000 a year to meet that goal.

If the monthly savings needed to hit your holiday target seem tough, we’ve put together a few tips on how to budget and save money here.

That being said, if your goal is five years or more away then you might want to consider investing to reach that target, either. 

Step four: think about investing 

Investing isn't just about making money; it's about making your money work for you. If you’re completely new to investing, you can learn more about it in our beginner’s guide to investing in Ireland.

Now, you might already know that when you invest, your investment can go down as well as up and you might lose some or all of your money. However, if you’re sensible about investing (and in it for the long haul) then the potential benefits could outweigh the risks.

The benefits and risks of investing

Let’s address this risk. Why not just save up in a regular bank account (or under the mattress if that’s your thing) where it’s safe?

Well, in a bank your money is probably earning very little in interest. It might even be earning no interest at all. Thanks to inflation, this means your money could actually be losing value over the years – think of how much things cost in absolute Euro values today compared to five years ago.

If your money is invested then yes, you could also lose money in real terms – but it also has the opportunity to gain value and even outpace inflation, giving you more purchasing power over the long run. As a rule of thumb, you should invest for a minimum of five years. 

How to start investing

You have two options with Irish Life. Whether you speak with a financial advisor or get started online, our experts choose the right investments for you to help get the results you want. 

• You can use Smart Invest – a super simple way to invest online or on your phone. Smart Invest is provided by Irish Life Financial Services and Irish Life Assurance and is available to residents in Ireland aged 18 to 59.  
• You can book an appointment to speak with a financial advisor and let them do the hard work for you.

This way, you can focus on planning the exciting details of your holiday while your investments are hard at work in the background. However, it's important to be aware that all investments come with a level of risk, and the value of your investments can go up as well as down. 

Step five: talk to a financial advisor 

Before you consider investing for your dream holiday, make sure you have your other financial needs taken care of. For example, do you already have an emergency fund set up? Are you already putting money into a pension? Even if you’ve got all your ducks in a row, do you know whether you’re planning on investing one lump sum, or investing regularly over a longer period?  

There are different investment options for different incomes, people, and situations. A financial advisor can simplify your options and help you get started. They can help you understand your risk tolerance, guide you through different investment options and help tailor a financial plan that best suits you. 

Remember, the more time your money is invested, the higher the chance of your investment growing. By considering investment options now, you could be setting yourself up for your dream holiday in the future.

While Irish Life don’t offer advice on budgeting or saving for a holiday, we hope you found this article useful. If the idea of investing has interested you, then you can book a free financial review with one of Irish Life’s trusted financial advisors to get expert advice.