Is There a Recommended Vacation Percentage?

Carl emails Dave to ask if you skip vacations while you’re paying off debt, and once you’re out of debt, what percentage of your income should you spend?

QUESTION: Carl emails Dave to ask if you skip vacations while you’re paying off debt, and once you’re out of debt, what percentage of your income should you spend?

ANSWER: Yes, I do skip vacations while I’m getting out of debt. We didn’t go on a vacation for almost 10 years. We had work to do and children to feed. That’s how it works.

As far as a percentage goes, it can’t damage your financial foundation. You can’t touch your emergency fund, you can’t stop funding your kids’ college funds or not fund retirement to go on vacation. You’ve got to be able to save up the money and pay cash, and then that will force it to become a reasonable percentage in most cases.

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