Saving for Brazil World Cup

Yingwane asks: My wife and I would like to go to 2014 Brazil World Cup. We would like to watch four matches, two of which must be quarter final qualifiers.

We can afford to save to save R2000 00 per month starting from January 2011. Will the saving be sufficient for all expenses like accommodation, match tickets and airline tickets. Where can we save the money?

Maya replies: It is difficult at this stage to estimate exactly what it will cost as tour packages and ticket prices have not been announced.

It also depends on the type of accommodation you want and how long you are staying for, as well as also the strength of the Rand at that time.

You may also want to include a few tourist activities — after all when will you get a chance to experience South America again?

It is unlikely that you would get away with less than R40 000 per person for a 10-day experience by the time you have paid for flights, accommodation, tickets, meals and entertainment.

If you start saving now and invested in a product that gave an inflation plus 2% return (between 6% – 7%) you would need to save R1 000 per person (or just R35 a day — the price of a packet of cigarettes). So your R2 000 should be enough for both of you.

The best way to approach your trip is to set a budget of R40 000 and then work your itinerary around this. Remember the closer you get to the bigger matches, the more expensive the flights become so you may want to fly in earlier and leave straight after your final match.

You may decide to opt for only one quarter final but include a tourist activity for example. You need to decide how much of this budget you will allocate to accommodation and then look for accommodation in that price range.

It is important that you work with a budget and don’t just pull out the credit card for “extras” as that will be sure way to land up with a big debt bill. However R40 000 per person should give you a reasonable budget to have a great trip.

As you have just over three years to save you can afford to take some risk in order to achieve a reasonable return above that of the money market and so you could invest the money into a low equity prudential balanced fund. In the year leading up to the World Cup you should then transfer the savings into a money market fund so as to protect the capital.

Read more news, blogs, tips and Q&As in our Smart Money section. Post questions on the site for independent and researched information.

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Maya Fisher French
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