Travel in retirement without ruining your nest egg-Anna Helhoski, NerdWallet

(Photo: Fuse, Getty Images/Fuse)

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For many people, having time to travel is one of the best perks of retirement. But if you're not financially prepared, you won't be able to afford the jet-set life you crave.
Nearly 70% of Americans say retirement travel is worth saving for, according to a joint survey by theTransAmerica Center for Retirement Studies and the Global Coalition on Aging[1]. But fewer than 20% have factored travel into their long-term financial strategy.
When it was time for Alan and Sharon Hanson to retire, they knew they wanted to travel. They moved to a retirement community in Gig Harbor, Washington, to help save on traditional homeownership costs, such as maintenance. And knowing they wanted to travel, the couple saved enough during their working years to afford their adventures, such as an upcoming European cruise, without creating a detailed, itemized budget.
"When you look at retirement far off, it's hard to say we need this much for travel and this much for medical," Alan Hanson says. "I think basically our wish was to maximize our nest egg and allow us to live like we wanted. Fortunately, that's the way it's working out."
You can do as the Hansons did and build a large enough nest egg to fund your travel and plan as you go. But if you want to ensure that your dreams become a reality, you need to draw up a budget. Consider the following five variables when planning your retirement travel:
1. Where, when and how often you travel
Where you go and how long you plan to stay are crucial in determining how much you spend, says Ed Snyder, a certified financial planner and certified health care financial professional at Oaktree Financial Advisors in Carmel, Indiana.
"It depends — are you going to Florida for a couple of months or a week? Are you going to Europe for a few days or traveling for a month? Costs can also vary from one year to the next," Snyder says.
Snyder recommends that retirees plan their trips at least a year in advance. Consider traveling to certain destinations during off-peak times to offset costs.
2. Your travel goals
Your budget needs to include how you physically plan to get to your destination as well as food, lodging and entertainment expenses once you get there. What matters most in your travel experience can help you figure out the best way to allocate your money.
"Knowing what you're looking to get out of a travel experience and being willing to cut out extras can make anything possible," says Tama Borriello, a certified financial planner and Wells Fargo financial advisor based in Bellevue, Washington.
For example, say you want to travel in luxury — first-class travel, five star hotels, fancy restaurants — but you don't have the budget to support a lengthy trip in that style. You could either cut down on the length of your trip or make compromises on where you stay and where you eat. Rather than stay in a hotel, you could consider an Airbnb, a home swap or another short-term rental.
3. Any unplanned expenses
Add a contingency fund to handle unexpected costs that might arise when you travel. "You've got to consider this kind of 'fudge factor' and assume something will go wrong or something will cost more than you planned," Snyder says. Unforeseen expenses might include car rentals, insurance, health emergencies or flight changes.
4. How travel plans will affect your overall finances
Consider the impact travel in your 60s will have on your financial security in your 80s or 90s, Borriello says. "We're encouraging our clients to think about what they can do at their healthiest, which are their earliest years of retirement. That's why having a plan is part of making the dreams part of the reality."
5. What you're willing to do to travel
Achieving your travel goals might require unconventional means. Californians Lynne and Tim Martin sold their home four years ago and have traveled the world ever since. They live for short periods in rental homes through the site HomeAway. In their travels they've lived in Ireland, England, Portugal, Germany, Turkey, Morocco, Mexico, Argentina and France.
"We are not careless people, and we did not wish to live with no money at the end of the day," says Lynne Martin[2] , who wrote a book about the couple's adventures called "Home Sweet Anywhere." The Martins worked with their financial advisor and put the proceeds from the sale of their home into a portfolio that will fund their later retirement years. The rest of their income and savings is going toward their travels.
"We have never touched that capital," Lynne Martin says. "The nest egg is still intact and we are very disciplined about what we do and very careful about adhering to that plan. After four years it's worked out perfectly."

Culled from US Today