Summer Vacation: 5 Tips for Trips with Friends and Family

Last Updated Jul 21, 2010 12:27 PM EDT

Vacationing with another family or a group of friends can earn you sweet savings - from group discounts to shared costs.

But before committing to a week together on the beach, it's important to cover some important bases to make sure everyone's on the same financial page. Otherwise, things could get ugly.

Here are 5 strategies for keeping things clear ahead of time.
  • Set a budget: Before booking any hotels or vacation homes, openly discuss what you're comfortable spending. Be upfront about your budget for each shared expense from lodging to even meals. How often will you eat out? Should you find a place with a kitchen so you can prepare meals? Make sure you and your friends are not on opposite ends of the spending spectrum otherwise that can create conflict during the trip.
  • Plan for sharing: Discuss how shared costs will be divvied up. Have the correspondence done over email so that if there's any confusion later, you can refer back.
  • Shop in advance: If you're staying at a vacation home where you need to bring your own toiletries and food, pick a day shortly before the trip when a couple of you can go shopping together for nonperishable goods and staples. It's cheaper to buy in your town - especially at a wholesale club or discount store - than to shop in a resort town, where stores tend to jack up prices.
  • Create a cancellation policy: Make sure everyone understand cancellation fees. This is a biggie. If you all agree on a hotel or resort that has a non-refundable cancellation fee, make sure each person understands the risks. If you're the one putting the charges on your credit card, collect everyone's money in advance.
  • Plan the fun: Agree to some activities in advance, like where you'll dine, day trips, etc., so you can at least go into the trip with a good sense of costs and budgeting.
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    Farnoosh Torabi is a personal finance journalist and commentator. She is the author of the new book Psych Yourself Rich, Get the Mindset and Discipline You Need to Build Your Financial Life. Follow her at www.farnoosh.tv and on Twitter at @farnoosh.

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