From Pension to Passport: How to Save for Your Golden Gap Year

Gap years don’t have to be limited to your twenties. A growing travel trend reveals that more people aged 50 and above are choosing to hit pause on their routines and instead enjoy bucket-list holidays or lengthy trips abroad later in life- a ‘Golden Gap Year’. Whether driven by a desire to see the world with more financial maturity or simply wanting to make the most of an extended career break, mid-life travel is fast becoming a popular milestone to reset and explore.

Before you pack your bags, it’s crucial you chart a course for your savings first. Extended time away from work, reducing hours or retiring earlier means ensuring you have a secure financial cushion for when you return is vital. With careful planning, it’s entirely possible to enjoy the adventure of a lifetime now without compromising on your long-term financial security.

1. Plan for the long haul

Before you pick up a guidebook, review your monthly outgoings, cancel unused subscriptions, and redirect those savings into a high-interest pot or investment account.

2. Build a 'home and away' budget

Clear up which bills will continue back home while you are away, and balance this against your on-the-road costs so your travel pot isn't unexpectedly dented.

3. Navigate for all terrains

Ensure you are budgeting for wider costs like travel insurance and visas, and set aside a small contingency fund in case of emergencies.

4. Don’t forget about life further along the route

A career break can impact your pension. Consider increasing your contributions by a percentage point or two to offset time away, and use the HMRC app to check your National Insurance record to protect your State Pension baseline.

5. Map out your milestone with the right tools

Use the Scottish Widows’ Career Break Modeller tool to calculate exactly how taking time out will affect your overall retirement savings and lifestyle.