How to plan for your dream vacation?

Imagine standing atop the Incan citadel of Machu Picchu, exploring the ancient ruins of Greece, or gazing on the northern lights from a cozy Icelandic cabin. No matter the destination, nearly everyone has a once-in-a-lifetime dream vacation close in their imagination. With the right strategies and mindset, it doesn't have to be just a dream. And you may be closer to achieving it than you think.

How much should I budget for a vacation?

Everyone's financial situation is unique. Before planning a big trip, it's a good idea to make sure you've got other financial basics buttoned up so your vacation won't get in the way of other plans. That includes, in no particular order:

• Spending less than you bring home

• Saving for medical expenses in a health savings account (HSA) or flexible spending account (FSA)

• Saving adequately for emergencies

• Contributing at least 15% of pre-tax income to retirement accounts annually (including any match from your employer)

• Working to pay down high-interest credit card debt

Don't worry—you can take a vacation even if you have credit card debt and your emergency fund is smaller than you'd like. The trade-off to understand is that it may take longer to achieve your other goals, so it may make sense to scale back vacation plans until you get back on firm financial footing.

When it comes to budgeting, Fidelity's 60/30/10+15 budgeting guideline suggests divvying money into broad buckets, rather than assigning

each dollar a job:

• Spend 60% or less of take-home pay on essential expenses like housing, food, health care, child care, transportation, and debt payments

• and other bills.

• Save 30% of take-home pay for "nice to have" or nonessentials.

• Save 10% of take-home pay for near-term goals and emergency savings.

• Save 15% of your pre-tax income for retirement, including any match or profit sharing from your employer.

Everything that is left over can be saved or spent. If your spending and saving approximately lines up, you're already doing great and may be able to find some extra cash to save.

Estimating and budgeting for vacation expenses

To get started, estimate your vacation costs and determine how much money you'd be able to save toward that goal on a regular basis.

Here are some important considerations to keep in mind as you begin planning.

• Time of year: Traveling in the off-season can help you save money or you could consider aiming to go in the shoulder season, right before or right after the major tourist season.

• Accommodations: The time of year you're visiting can have a major impact on expected costs; being flexible with your travel dates can help you take advantage of travel discounts.

• Travel arrangements: You may want to start watching airfares as much as 11 months in advance of your departure—but it depends where you're going. Read Viewpoints: When is the best time to buy plane tickets? and How to save money on travel

• Rental car or other mode of transport: Like booking a flight, it can make sense to keep an eye on car rental aggregator sites to compare rates.

• Booking in advance may help you get a good rate, but be sure to read the cancellation policy in case you find a better deal. If you're planning to use public transportation, find out all the details before you arrive. For instance, some trains in Europe require making reservations in advance so it can be a good idea to plan before you go.

• Experiences: What do you want to do when you get there? Your priorities will strongly influence the price of your trip.

• Food and drinks: If saving money is on your itinerary, consider booking accommodations with a microwave or kitchen available for cooking, or pack some shelf-stable snacks to stash in your luggage.

• Clothes: Determine ahead of time what kind of extra clothing may be needed so you have time to shop for and test any new purchases.

• The home front: Depending on your length of travel, you may need someone to keep an eye on your home, for tasks like collecting mail, checking on pets, and watering plants.

• Fees: If you're traveling to a foreign country, make sure you have a plan for spending money. There may be a currency conversion fee and foreign transaction fees levied on debit or credit card spending. (Just so you know, the Fidelity Rewards Visa Signature Credit Card has no foreign transaction fee.) And there may be fees to take money out of ATMs. Shopping around for a debit or credit card with no or low fees when traveling could help minimize these types of expenses.

Taking a Full View of your finances

Budgeting isn't always easy but it can be easier using digital tools that help you track spending and saving. With planning and saving, a once-in-a-lifetime dream vacation may not just be once in a lifetime.