For a lot of Muslims, going to Mecca for Holy Pilgrimage – known as Hajj is the most rewarding and fulfilling spiritual journey. A period looked forward to with utmost fondness. However, before one can go on Hajj there’s a lot of preparations to be done ahead of making the journey. One of such is the financial preparation for it as undertaking Hajj is not what can be stumbled into on impulse.
Experts say that costs have risen dramatically in recent years from countries such as the U.S. and UK. A typical Hajj trip costs about $3,000 to $10,000, or even more if you live in a country very far away from the kingdom such as Nigeria or Ghana. Travelling to Saudi Arabia for Hajj is very expensive and requires an adequate financial plan. Well, that’s why we are here.
We did some research and came up with a few tips to lessen your burden and make the financial preparation for Hajj easier for you.
Plan to go on Holy Pilgrimage next year? These tips would come in handy for you and anyone preparing for Holy Pilgrimage
1. Review your current financial situation
Before embarking on a financial project, the first thing you should do is to analyse your financial status, take a look at your cash flow and expenses from the past year. Dig deep. You should collect all bank account and bank card statements, loan documents, and tax filings, receipts and every document that can help you paint a complete picture of your financial situation. There are numerous financial applications available to track your spending. If you aren’t tech-savvy, stick to an Excel spreadsheet or simply pen and paper. Once you have assessed your financial situation, then you can take the next step towards planning for your journey.
2. Set a realistic goal
After you have gotten a full picture of your current financial status, the next step is to set a realistic goal based on your finances. To further help you make the best decisions, you can ask yourself questions such as
- How much debt do I have and how soon can I clear them? (Since you are not allowed to do Hajj on loans and your debts should be clear before travelling for this journey).
- What is the total worth of my assets?
- How much do I spend on housing, transportation, food, entertainment, etc?
- How long would it take me to save for my journey
3. Start taking steps towards your long term financial target
To budget for Hajj, you will need to have a long term monetary target. Research local Hajj vendors and travel agencies to get an estimate on the price of Hajj travel packages. Add an extra 10% for travel essentials, unexpected costs, charity, and souvenirs. For eg: a meal for one maybe around 10-40 Saudi riyals ($3-$10 approx.) depending on what type of food you have), haircut/head-shaving is 20-30 SAR approx. etc. (Although with any decent package, you can get great deals on things such as feeding, but it’s best to inquire such things from the travel agent you are considering to purchase the package from)
Automate your bill payments to avoid paying costly late fees. Automate savings deposits to build up an emergency fund. Don’t wait until you have cleared all debt to start saving. An emergency fund will prevent you from going into further debt when emergencies or unplanned expenses occur. To keep yourself from spending your savings, put it into an account separate from your daily banking. The adage “Out of sight, out of mind” rings true here. Prioritize wiping out debt, especially debts dealing with interest.
4. Create your short term budget plan and/or increase the cash flow
Once you have determined how much money you need to save, you can divide the total by the amount of time you have. For example, let’s say you’ve estimated that it will cost you, family, $5000 to attend Hajj 2023 from Nigeria, Add 10% ($5500) and round up to $60,000. You have 2.5 years left to reach your goal, but probably want to have the money at least six months in advance. That gives you two years to save $60,000. $6,000 divided by 24 months = about $250 a month. This means that if you are to attain your goal, you need to free up $250 a month and place that into your Hajj savings.
Depending on your situation, slashing this much money from your monthly expenses might not be realistic. If that is the case, don’t despair. An important aspect of budgeting for Hajj is reducing expenses. The other part of the equation is increasing your income. Increasing cash flow can be more difficult than reducing expenses, but can significantly increase your ability to save. Remember that any change, large or small gets you closer to where you want your goal
Create An automated Savings Plan for the journey
Now that you know how much you would need to set aside monthly from your income, you can now start saving towards it. Creating an automated savings plan makes sure that whether you forget or not, your money is being saved automatically and you have a faster chance of meeting your goal. Using the example above, you need to save 250 dollars every month for 24 months to be able to meet your goal, this means that setting up a daily savings plan of 9 dollars every day Named “Hajj 2023” would help you meet your target and still have change left. With Bitnob, you can easily set this up, and the best part is that your money is automatically saved in dollars so you won’t need to worry about your savings losing value before the time comes for you to go on your journey.
Paying for a Hajj trip can be expensive and challenging, however, with Bitnob, you can achieve your goal easily and without stress, all you need to do is create a savings plan targeted at it and start saving today and you’re well on your way to the Holy City! Don’t forget to include us in your prayers when you do!