When planning a trip, it is easy to underestimate your costs and go over your travel budget. There are lots of little expenses that add up. In this guide, I explain how to create an accurate budget for traveling. I’ll outline every expense that you’re likely to incur and explain how to estimate it. We’ll cover transportation, accommodation, food and drink, admission tickets, tours, activities, visas, travel gear, and much more. This process works for all budget ranges and trip lengths. It doesn’t matter if you’re planning a weekend getaway, an international vacation, or an extended round-the-world trip. If you follow this guide, you’ll end up with an accurate trip budget. I will explain how to track your spending while on your trip to help you stick to your travel budget.
This guide is broken down into 5 categories:
- Food and Drink
- Entertainment, Tours, Admission Tickets, and Activities
- Additional Expenses: Insurance, Visas, Vaccines, and Travel Gear
After calculating all of our travel expenses, you will add them up to see what your desired itinerary would cost. From there, you can make adjustments to fit your total trip budget. At the end of each section, I include some helpful money-saving tips that I have picked up on the road.
How Much Does it Cost to Travel?
The cost of traveling depends on a variety of factors, so it is hard to give an exact answer. Generally speaking, the farther and longer you travel, the more expensive your trip will be.
Your destination is the main factor that determines how much your trip will cost. You’ll spend a lot less while traveling in Southeast Asia or Central America than If you were traveling through Western Europe. Traveling locally is cheaper than traveling abroad. When you travel abroad, you can expect your travel expenses to increase due to the high cost of airfare.
Budgeting for your trip is also highly dependent on personal preference. How much luxury do you need? Do you plan on staying in luxury hotels or budget hostels? Do you want to try out local restaurants or cook your own meals? Can you travel by bus or do you need to fly? Do you enjoy expensive activities such as Scuba diving or taking hot air balloon rides? All of these factors can drastically affect the total cost of your trip.
Traveling can range from relatively inexpensive to quite costly. The good news is that there are plenty of ways to save while still having a wonderful experience. You can shop for deals on flights and accommodation. You can stay in hostels instead of hotels. It’s possible to enjoy a great trip with a surprisingly small amount of money. Budget travelers can travel on just $1000-$1500 per month. If you’re traveling in an expensive region, you might spend $1000 per month.
Transportation Budget for Traveling
Getting from point A to point B is a major travel expense. Maybe even the biggest expense depending on where you’re traveling. According to this guide, travelers spend an average of 44% of their travel budget on transportation. Transportation costs include flights, parking, a rental car, bus and train tickets, and public transport. In this section, I’ll explain how to estimate your transportation budget for travel. I’ll also share some tips to help you save on transport.
Airfare Budget for Traveling
The single largest individual expense of your trip will likely be your airplane ticket. Airfare is expensive. A round-trip intercontinental ticket can cost $1000-$1500 or more. A round-trip domestic ticket in the U.S. is around $300.
You can use a flight booking tool such as Skyscanner, Kayak, or Google Flights to estimate the cost of your flights. These tools can quickly give you an overview of flight prices for the entire month. This gives you a good idea of ticket prices. You can also use these services to find cheap flights.
There a few ways to save money on airfare. When booking your ticket, try to be flexible with your travel dates. Generally, it’s cheaper to fly during the week than on weekends. Flights during the off-season and shoulder seasons are cheaper than flights during peak seasons and holidays.
You can also save money by flying into a different airport. Many major cities have multiple airports. For example, if you’re flying to New York, check the price of flights to LaGuardia (LGA), John F. Kennedy (JFK), and Newark (EWR) airports. Sometimes flying into one is cheaper. Most booking sites allow you to search multiple airports.
Sometimes you can save money by flying to a city that’s in the same region as your destination but cheaper to fly into. For example, maybe you want to fly to Kuala Lumpur, Malaysia. You might save money by flying into a major hub city like Bangkok. From there, you can take a cheap flight on a budget airline to Kuala Lumpur. Some major hubs around the world include Dubai Airport, London Heathrow, Istanbul Airport, Chicago O’Hare International, Incheon Airport, and more. You can often find cheap flights flying into and out of these airports.
You may also save by flying to a nearby city and then taking ground transport to your destination. Sometimes cities are cheaper to fly to than others. For example, instead of flying directly into Orange County, California, you may find a better deal on a flight to Los Angeles International Airport(LAX). From there, you could take a shuttle, bus, or rental car to your destination. Most booking sites allow you to search nearby airports.
You can also save by flying budget airlines rather than big-name national airlines. Budget airlines offer fewer services but cheaper flights.
Another way to save on flights is to take advantage of credit card offers. I flew round trip between Los Angeles and Africa for free with credit card miles. For my card recommendations, check out my guide to the best credit card for travel.
If you’re planning on taking an extended trip around the world, you may be able to save by buying a round-the-world ticket. Many airlines offer round-the-world tickets with stops on different continents. Several third-party services are also available to help you mix and match. For more info, check out my guide to planning a round-the-world trip.
Regional Transportation Costs Between Cities and Countries: Buses, Trains, Flights, and Ferries
If you’re traveling to multiple cities or countries during your trip you must also consider the cost of transport between destinations. You’ll have to fly, take a bus, or take a train, between each city or country you plan to visit. Generally, a regional bus trip that lasts 6-12 hours costs around $20-$100. A train journey from one city to the next could cost $50-$200. A one-way regional flight costs around $100-$300.
Before your trip, be sure to research the price of bus and train tickets and flights on all of the routes you plan to travel. Most bus and train companies list ticket prices on their websites these days. To save time, you can use a booking site to find the cost of tickets. A great resource for finding bus and train routes and prices is rome2rio.com. This site makes it easy to research transportation options and estimate the cost of tickets. Another great booking site for finding bus ticket prices is Busbud. For train routes and ticket prices, seat61.com is an excellent resource. You can use a flight booking tool such as Skyscanner, Kayak, or Google Flights to estimate the cost of regional flights.
Regional transportation costs are usually pretty affordable. If you’re traveling around a lot during your trip, transport costs can add up. Generally, the cheapest way to travel from one city to the next is by bus. Trains and flights are usually more expensive. It’s still worth checking prices. Sometimes flying is the cheapest option thanks to budget airlines.
Local Transport: Public Transportation, Rental Car, Taxis, and Uber
Next, take into consideration transport costs around the towns and cities that you will be visiting. This includes taxi, Uber, metro, city bus, and tuk-tuk fares. To estimate this, look at the locations of the sites that you plan to visit within the city and research the transportation costs between there and your accommodation. You can usually find average one-way transport prices online.
If you don’t feel like taking the time to estimate the cost of local transportation, you can simply raise your daily spending money budget by the average price of a round-trip public transport ticket. Sometimes you can buy a weekly or monthly unlimited pass and add that to the cost of your trip.
If you plan to drive a rental car, you’ll need to factor in the cost of the rental, gas, and insurance. Visit your favorite booking site to check the price of car rentals. Discover Cars and Kayak are popular options for booking a rental car. On average, renting a car costs $40-$80 per day.
Remember that the price of rental cars varies throughout the year. Prices increase during the busy season and during holidays because demand increases. Rental car prices also vary greatly by location.
Tips for Saving Money on Transportation
The cost of local transportation can quickly add up. If you take a taxi or Uber or take multiple metro trips daily, you could spend hundreds of dollars per month. There are a few ways to save.
To reduce your cost of local transport, try to walk more. Instead of taking an Uber, walk from your hotel to the museum. Walking is free. As an added benefit, walking helps you get to know the city better. It’s also healthy.
When taking a taxi or tuk-tuk, negotiate hard. Taxi drivers love to rip off foreigners. If a cab driver won’t give you a reasonable rate, keep asking drivers until you find a driver that wants the fare.
Cycling is also a great way to get around cities. Many cities offer affordable city bike rental programs. These programs are often open to tourists. Cycling is a cheap and healthy way to get from point A to point B. If you’re on an extremely low budget, you could consider hitchhiking.
Accommodation Budget for Traveling: Hotels, Hostels, and Airbnbs
After transportation, your biggest travel expense is probably accommodation. After all, you will need somewhere to sleep every night of your trip. It’s easy to go over your travel budget if you overspend on accommodation.
To estimate your accommodation budget, go to a booking site like Booking.com or Agoda and research the price of hotels at your destination. Airbnb is also a great option in some regions. If you’re on a tighter budget, check Hostelworld for the price of dorm rooms.
When searching for accommodation, check the prices of multiple properties in every city that you plan to visit. Try to find an average price. Sort properties by most popular instead of cheapest. This can take quite a bit of time but it is necessary to get an accurate idea of your accommodation cost. If you’re conservative with your budgeting, you’re less likely to overspend.
Remember that accommodation prices change based on the season in many places so this must also be taken into consideration. In general, traveling during the summer is more expensive because demand is higher. Traveling during holidays and festivals is also more expensive than traveling during the normal season. For example, in Rio de Janeiro, the price of hotels doubles during Carnival. Some properties also charge more on the weekends than during the week. It’s important to consider the season when estimating the price of accommodation.
Once you have found the average cost per night for each city that you plan to visit, simply multiply the nightly price by the number of nights that you plan to stay. Next, add them all up. This is your total accommodation budget for the trip. If you’re not sure how long you plan to stay in each destination, you can calculate an average nightly accommodation cost based on hotel prices in each place you plan to visit.
There are a couple of ways to save money on accommodation. You could stay in a dorm room in a hostel. A bed in a dorm costs 25-50% of the price of a hotel room. If an average hotel room costs $100-$150 at your destination, a hostel dorm bed might cost $20-$40.
Camping is also a great way to save money on accommodation. Oftentimes a campground costs $15-$25 per night. There are also plenty of free campsites if you look around. In some countries, wild camping is legal. Some hostels allow you to pitch your tent on their property for less than the cost of a dorm bed. These days, I sometimes travel with a small tent or hammock to save on accommodation.
Another great way to save on accommodation is to travel at night. By taking overnight buses, trains, and flights, you save on a night of accommodation every time. This can really add up if you move around a lot during your trip. Even though sleeping on a bus is uncomfortable, the money you save may be worth it depending on your travel budget. For example, if you travel to a new city every 4 days, you can potentially cut your accommodation budget by a quarter by sleeping while you travel.
Food and Drink Budget for Traveling
Food and drinks are some of your biggest travel costs. It’s difficult to estimate the cost of food and drinks. This is one thing that varies quite a bit from person to person. Everyone enjoys different types of foods. Some people prefer to eat in restaurants every day while on vacation. Others don’t mind cooking for themselves. Some people drink and others don’t. Some people are happy to eat local foods and street food. Others prefer eating more familiar foods. Of course, the cost of food and drinks also varies greatly by destination. In some countries, you can eat a meal in a restaurant for $10. In other countries, a meal costs $25. For this reason, food and drink is the hardest part of the budget to calculate.
To give you an idea of how much food might cost you, on average Americans spend $35 per day on food while taking an international vacation according to this guide. It’s easy to spend much more or much less than this depending on your eating habits. There are also a few ways you can cut your food budget.
When calculating your food budget, think about what you plan to eat, where you plan to eat, and how much you need to eat. You’ll have to budget more for food if you plan to eat in restaurants for every meal. Restaurants are expensive. If you’re a foodie who likes to sample different foods and eat in fine restaurants, you’ll need to budget plenty for food. If you’re staying in a hostel or Airbnb with a kitchen, you can buy groceries and cook some of your own meals. This is cheaper. Also, consider how much you like to eat. If you’re a big eater, you’ll spend more on food.
Also, think about what you like to eat. Some travelers happily eat local food while others are picky and prefer more familiar foods. It’s also important to remember, you’ll probably need to eat more than you’re used to because you’ll be more active while traveling. Travel is exhausting. You’ll burn lots of calories while sightseeing and moving around.
If you cook all of your own meals it’s possible to eat for just $5-$10 per day in much of the world. Eating all of your meals in restaurants costs around $30-$50 per day in most countries. If you enjoy a mix of restaurants, street food, and cooking for yourself, you can eat well for $15-$25 per day.
If you want to create a more accurate food budget, you can do some research on food costs in the region you plan to travel to. Look up some restaurant menus online. If you can, look at the cost of groceries. Create a rough daily food budget and multiply it by the number of days in your trip. This will give you a guide to try to stick to while you are traveling.
You don’t need to spend the same amount on food daily. You can average your food budget out across your trip. For example, maybe one day you splurge on a nice steak dinner and spend $50 on dinner. You can cook a cheap meal to balance your travel budget the next day.
Another important cost to consider is alcohol. If you are a drinker, you could spend more on alcohol than you spend on food. Consider how much you drink, how often you drink, and what you drink when calculating your alcohol budget.
Drink prices vary greatly around the world. For example, in some countries, you can buy a beer for $3. In other countries, a beer costs $15. If you prefer cocktails, you’ll spend more. It’s easy to spend $100 on alcohol on a night out.
To get an idea of how much you’ll spend drinking, look up some restaurant menus in your destination and check the price of drinks. Consider how many drinks you like to have with your meals and while going out. Also, think about how many times per week you plan to go out drinking. Most people tend to drink more while on vacation than while at home. You may spend more on drinks than you expect.
Drinking too much alcohol is one of the easiest ways to go over budget. If you’re on a tight budget, you’ll need to be careful with drinking and partying while you travel. I have met travelers who had to cut their trip short because they partied too much.
There are a few ways to reduce your travel budget for food and drinks.
One of the best ways to save money on food is to cook for yourself. It’s far cheaper to buy food in a grocery store and cook it than it is to eat in restaurants. If you are on a very low travel budget, you can travel with your own cooking gear. A camp pot and stove are easy to pack and allow you to cook while traveling. Of course, you won’t want to cook all of your own meals. You’ll still want to go out once in a while to sample the local cuisine.
One of the easiest ways to reduce your travel budget is to drink less alcohol. Drinking is expensive. It’s easy to overspend and blow your budget when you go out to a bar or club. Reducing your drinking or giving up drinking altogether will greatly cut costs. When I was younger, around two-thirds of my food and drink budget went toward alcohol. These days, I like to pick and choose my going-out nights carefully rather than drinking every night. I spend far less on alcohol. Another option is to buy some drinks in a grocery store or liquor store and drink in your hotel room instead of going to an expensive bar.
Another great way to save is to book hotels and hostels that include breakfast. This saves you at least a few dollars per day because you won’t have to buy coffee or breakfast in the morning. It’s also one less meal to worry about. If there is a continental breakfast, you may even be able to sneak a bit extra out for later.
Another way to reduce your food budget is to maintain a vegetarian diet. If you’re willing to live on cheap foods such as rice, beans, eggs, and fresh vegetables, you can eat cheaply anywhere in the world.
Admission tickets, Tours, Entertainment, and Activities Budget for Traveling
Next, you need to budget for all of the activities you plan to do during your trip. This includes admission tickets, entrance fees, tours, permits, guides, tips, equipment rentals, entertainment costs, etc.
To calculate the cost of activities you must research the costs of all of the activities you plan to do and add them up. For example, if you plan to visit an amusement park, go to their website and check the cost of tickets. If you plan to go skydiving, visit the company’s website and check the prices. If you’re visiting Machu Picchu, check the price of tours.
When you book tours, calculating the cost of activities is pretty easy. You pay one price that includes a guide, entrance, and transportation. If you plan to piece things together and go independently, it can become a bit more complicated. You’ll have to consider the price of transport, parking, tickets, a guide, etc.
Doing your research and knowing the rough price of everything that you want to do during your trip helps you avoid expensive surprises. Sometimes activities cost much more than you think. For example, I was surprised by the ridiculous entry fees to Serengeti National Park while going on a safari. I spend a couple of hundred dollars more than I expected to spend.
There are some additional major travel expenses that are easy to forget about. For example, if you’re driving your own vehicle, you may have to pay for parking. Parking in a crowded city could cost you $20-$50 a day. You’ll also have to consider the cost of tips for your guide. While you’re doing an activity or sightseeing, you might also be forced to eat in expensive touristy restaurants. Sometimes food options are limited.
There are a few ways to save money on activities while you travel.
In most cases, you can save some money by doing activities independently instead of booking a tour. Take public transportation to your destination, forgo a guide if you can, and pack your own food. I did this when I went on a safari in the Maasai mara in Kenya. The tour cost was $350 but I was able to organize the safari by myself for less than $200.
Another way to save money on activities is to book locally instead of booking in advance. Waiting until you arrive allows you to shop around locally and negotiate directly with tour companies. You can often score some great last-minute deals if are willing to wait a few days. The only time this doesn’t work is if you are working with a tight schedule and you must do an activity on a particular day. In this case, it’s best to book in advance.
You can also save money by simply skipping some stuff. You don’t need to visit every attraction just to say you’ve been. If something doesn’t interest you, skip it. If you think a particular activity or attraction is too expensive or offers a poor value, skip it. Spend your day doing something you enjoy instead. It’s your vacation.
You can also save by taking advantage of discounts and free days. Some museums offer free entry once per week. If you are a student, many tourist sites offer student discounts. Sites will be more crowded on free days but if you are willing to put up with more people, you’ll save money.
There are also plenty of free things you can do. You don’t have to spend money every day. Check out my guide, 30 free things to do while traveling for some ideas.
Additional Expenses to Consider While Making Your Travel Budget
There are a number of additional expenses you’ll incur including travel insurance, visas, and vaccinations. These additional expenses can add up.
Travel insurance will be one of your major travel expenses if you’re traveling long-term. The cost of travel insurance depends on the kind of coverage you buy, the amount of coverage you buy, the amount of the deductible, where you’re traveling, and your age.
Travel insurance can cost anywhere from $20-$150+ per month depending on the coverage. The more coverage you get, the more the policy will cost. Most travelers should have a minimum of $100,000 in coverage. If you’re traveling to the U.S., you should have at least $250,000 in coverage.
Older travelers pay more for travel insurance than younger travelers. Those traveling to dangerous regions also pay more. Policies with a lower deductable or no deductable have a higher premium.
If you’re on a budget, you can opt for medical-only travel insurance. Travel insurance that covers your luggage and trip interruptions is significantly more expensive. If you carry expensive equipment with you, like cameras and computers, you may need to buy separate insurance if you want everything covered.
In most countries, travel insurance is optional but highly recommended. I use SafetyWing Nomad Insurance. They offer affordable insurance for long-term travel.
Many budget travelers consider travel insurance to be unnecessary and a waste of money. Personally, I disagree. I consider travel insurance to be essential. Particularly for travelers who participate in extreme sports or visit destinations that could be considered dangerous. A good travel insurance policy can cover you in the event of an injury or unexpected illness. Some policies can cover theft, damage, or loss of your belongings and trip interruptions. It’s worth it for the peace of mind.
Vaccinations, Medications, and Other Health-Related Costs
Travel insurance doesn’t cover everything. You might have other health-related costs that you have to budget for.
Depending on your destination, you may need some travel vaccinations. For example, a few countries require you to have a Yellow Fever vaccine. This is a common entry requirement in many countries in Africa and some South America. You need proof of vaccination to enter. Some vaccinations are highly recommended but not required. For example, before you travel, you may want to get typhoid, hepatitis A and B, and rabies vaccines.
Travel vaccines can be expensive. You may spend several hundred dollars on a medical consultation and vaccines. In the U.S, a Yellow Fever vaccine can cost $200 alone. If you’ve never had any travel vaccinations before, you could easily spend $500 on vaccines before your trip.
In addition, you may also need to buy malaria pills if you’re traveling to a region with malaria. Before your trip, you’ll need a malaria consultation and a prescription for malaria prophylaxis. One of the most popular types of malaria prophylaxis, Malaraon, can cost $200 per month. Cheaper options are available.
If need to take any medications, you may need to buy a supply for your trip. If you run out, you may need to buy some while you’re abroad. Maybe you want to go to the gym while you travel. You’ll have to budget for gym entry fees.
Before your trip, you should check whether or not you need a visa to visit your destination. Whether or not you need a visa depends on the passport you’re traveling with, which countries you’re visiting, how long you plan to stay, and the purpose of your trip.
For most international trips, visas are a minor expense. Most tourist visas cost $20-$50. Many visas are free. There are a few expensive ones that cost $100-$300 dollars.
Sometimes there are additional costs involved in obtaining vias. For example, if you have to apply for a visa in advance, you may have to pay to ship your passport to and from the embassy. For complicated visas, you may have to hire a visa agency.
If you’re taking a round-the-world trip, visas may be a major expense. For example, when I traveled through Africa, I spent about $600 on visas in 5 months of travel. Most countries in the region charge $50-$100 for a tourist visa.
Some visas are more expensive than others. For example, residence visas, digital nomad visas, working holiday visas, student visas, etc. are often more expensive than standard tourist visas.
Your passport can also determine the visa cost. For example, when I traveled to Tanzania, I paid $100 for a visa with my U.S. passport. My friend paid $50. We both received the same visa. Mine cost more because of my nationality. Some countries charge reciprocal visa fees. This means they charge foreign visitors the same price that their citizens pay for a visa to your country.
Travel Gear: Equipment, Clothing, and Electronics
Another major cost that many people don’t take into consideration is travel gear. Before your trip, you may need to buy luggage. A good backpack or suitcase can cost $100-$200. You might also need to buy a daypack, luggage locks, packing cubes, a toiletries bag, a money belt, and other accessories. In addition, you’ll have to buy travel-sized toiletries including soap, shampoo, sunblock, bug spray, etc.
If you travel regularly, you might have all of the gear you need. If you’re taking your first big trip, you might need to budget $200-$300 for travel gear.
You may also want to buy some new clothing before your trip. One of the most important pieces of gravel gear is a comfortable pair of shoes. Chances are you’ll be on your feet a lot while out sightseeing. You might also want to buy some travel clothing. Travel clothing is lightweight, durable, wrinkle-resistant, and quick-drying. You might also want to buy some new clothes for going out.
You’ll probably want to budget at least $100-$200 for some new clothes. Of course, if you’re on a tight travel budget, you can always wear whatever is in your closet.
Clothing and Gear Replacement
Stuff tends to wear out quicker when you’re traveling. Your electronics will be exposed to vibration, humidity, and dust. Your clothes will wear out faster because you’ll wear each item more often and for longer periods. Travel is not good for the longevity of your possessions. It causes lots of wear and tear. It’s also easy to break or lose items while you travel. Particularly if you’re moving around often. Theft is also an issue.
If you are traveling long-term, you should add $50-$100 per month to your travel budget. You can use these travel funds to replace clothing and travel gear as it wears out, breaks, gets lost, or gets stolen.
For example, maybe your phone gets pickpocketed and you need to purchase a new one. If you accounted for gear replacement in your budget this unexpected expense is already accounted for in your travel budget. Maybe your shoes wear out. If you left room in your travel budget, buying a new pair of shoes isn’t an issue.
Expenses You Have Back Home
It’s also important to consider any recurring expenses you have back home. For example, you might have to make rent or mortgage payments. You may have to continue paying your utility bills and cell phone bill while you’re away. If you have credit card bills or car payments, you’ll have to keep paying while you’re traveling. You might have to pay for health insurance, auto insurance, and home insurance. These expenses can add up.
To reduce your traveling costs, try to eliminate as many bills as possible before your trip. You can cancel or pause your streaming services or phone service. You may be able to suspend or reduce your insurance if you’re traveling abroad. If you’re traveling long-term, it might make sense to sell your home and car to further reduce your expenses. It doesn’t make sense to pay for something you’re not going to use.
Other Small Expenses
There are a number of other minor expenses you may encounter. You may need to pay for phone service. In most countries, you can buy a sim card with calling and text and some data for $10-$20 per month. Alternatively, you could use your phone plan from back home if it works internationally. If you’re on a tight travel budget, you could rely on free WiFi for communication.
You may also have to pay for laundry. A small load of laundry might cost $4-6 at a laundromat. You can also pay for laundry service for $10-$20 per load. If you’re on a budget, you can buy laundry detergent and wash your own clothes in your hotel room sink or in a bucket.
If you’re traveling for a month or more, you might also have to get your hair cut. A haircut could cost anywhere from $5-$100 depending on the type of haircut and where you’re traveling. To save some money, you can also cut your own hair. I always pack a pair of clippers when I travel.
It’s a good idea to stash away some emergency money in case your credit or debit card is lost or stolen. I usually bring $300-$1000 depending on where I am traveling. I try to bring enough money to sustain myself for at least a week.
When you’re traveling long-term, it’s also important to have an emergency fund in case you have to return home unexpectedly. You should always have enough money to buy yourself a ticket home.
After You Have Found All of Your Travel Expenses
After you have found the costs of transportation, accommodation, food, activities, and everything else, add everything up to see how much your desired itinerary costs. This will give you a pretty accurate cost for your trip. You can divide the total by the length of your trip to calculate your average travel costs. You can calculate a monthly, weekly, or daily cost for your trip. This can be helpful while budgeting.
Chances are, your desired trip costs more than you want to spend. At this point, you can make adjustments to your trip budget to make it more affordable.
How to Stay on Budget While Traveling
During your trip, you should track your spending. This will help you stick to your budget. If you overspend one day, you can reduce your spending to get back on track.
Tracking your travel expenses can be difficult, but using a spreadsheet will make it easier. With a simple spreadsheet, you can record every purchase. Your spreadsheet can be as detailed or as simple as you like.
Start by creating columns for categories of expenditure such as accommodation, food, transportation, tours, and entertainment costs. Within these categories, add rows for each expense and note the date and cost. You can also add a column to note if the expense is one-time or recurring. Every time you spend money, add it to your spreadsheet.
This helps you get an overview of your spending and make sure you stay within your travel budget. Once you’ve input all the data into your spreadsheet, use the formulas provided to quickly calculate your total expenditures for each category and sum up the totals for all categories. This will give you an at-a-glance view of how much money you’re spending on each item. If you find that you’re going over budget, you’ll be able to quickly tell where you’re overspending.
If that requires too much effort, you can simply track your spending on your phone’s notepad app. A paper notepad also works. After you buy something, write it down.
Generally, I just take note when I withdraw money from the ATM. I also go over my credit card bill and transfer the purchases into my spreadsheet. I don’t really care about the specifics of each purchase every day. For me, it’s not worth the effort to write down every time I buy a soda. I just track total expenditure.
You should use your spending spreadsheet to periodically check whether or not you are sticking to your travel budget. When you first start traveling, you might have to check weekly. If you’re traveling long-term, you can check your spending monthly. If you’re considering a major purchase like an expensive tour or airplane ticket, check your budget before hitting the buy button to check whether or not you can afford it.
Compare the amount that you spent with the amount that you budgeted. If you find that you are over budget, you can make adjustments as you continue your trip. If you overspend a bit one week, try to be more careful with your spending the next. Some weeks, you will have an unexpected expense; some weeks, you may come under budget. It’s all about the average.
Lately, I’ve been living as a digital nomad. I usually check my spending monthly. If I overspent, I’ll try to be more frugal the next month. If I’m under budget, I simply save the extra money.
Another Way to Budget for Traveling
If you’re planning a long trip, it can be easier to make a daily or monthly budget to stick to. It would be too difficult to add up all of your expenses. When you travel long term, you may not know how long you’re going to spend in each destination or what you’re going to do. You may not even know where you’re going. Your budget probably wouldn’t be very accurate.
The easiest way to create a travel budget for long international trips is to start with the total amount of money you have saved for your trip. From there, subtract all major expenses that you can think of. You may include airfare, travel insurance, expensive tours and activities, bills you have back home, etc. For shorter domestic trips, you might include accommodation and known transportation expenses. Move this money from your checking account to your savings account. When the money is out of your checking account, you’re less likely to spend it.
Divide whatever’s left over by the number of days you plan to travel. This gives you a rough daily budget that you can try to stick to. If you want a monthly budget, you can multiply the daily budget by 30. You could also create a weekly budget if you prefer.
Having a rough daily budget can make it easier to stay on budget. If your budget is $100 and you spend $10 on museum tickets, $20 for lunch, and $30 for a bed in a hostel, you know you have $40 left for the day. If you go over one day, you can try to spend less the next day to average it out.
Removing major expenses makes it easier to calculate a realistic daily budget and stick to it. The money that you set aside for major expenses is basically already spent. If you remove it from your budget, you won’t feel like you have more money than you do. You also won’t have to worry about large upcoming expenses, such as an international airline ticket. It’s difficult to budget if one day you have to spend $1200 on an airplane ticket. This blows your daily budget. With this method, the money is already set aside prior to determining how much you have left to spend daily. All you have to worry about is daily costs such as food and accommodation. You won’t skip things as often because you are stressed about your finances. You know that you have already budgeted for major expenses.
An Example of a Travel Budget
Imagine you’re traveling to Kenya for two weeks for a vacation from the U.S. and you want to create a travel budget. Let’s say you have a $5000 budget for the whole trip.
First, add up all of your major expenses. Maybe you spend $2000 on airfare, $500 on a safari in the Maasai Mara, and $1500 on hotel rooms. This means your major expenses cost $4000. This leaves you with $1000 for daily expenses. $1000/14 days = $71.42 per day in spending money.
This $71 would need to cover your food and drinks, souvenirs, local transportation, and any other activities or tours you plan to do while visiting Kenya. That is a manageable budget. You’ll still have to watch your spending but at least your airfare home and accommodation will be covered. You’ll have plenty of spending money for food and entertainment costs. This simple formula will work for any trip.
Tips for Reducing Your Travel Budget
- Skip some cities- Visiting fewer destinations cuts your transportation costs and activity costs. It’s nice to spend more time in one city rather than moving around every other day.
- Visit cheaper countries- Traveling in expensive developed countries like Norway or Japan can cost well over $100 per day. In many developing countries, you can get by on less than $40 per day.
- Travel slowly- Rather than flying from one city to another, take a bus or train. To save even more, you can walk or bicycle tour. Also, stay in each city longer. You’ll spend less on accommodation.
- Prioritize your expenses- Maybe want to go on a hot air balloon ride and eat at a Michelin-star restaurant but you can’t afford both. Pick one and skip the other.
- Travel domestically- Domestic trips are generally cheaper than international trips. You’ll save big on airfare when you stay closer to home.
- Stay in cheaper accommodation- Rather than hotels, consider staying in hostels. Camping is also great for saving money.
- Spend more time in each city- If you spend a week or a month in each city, you can often find discounts on accommodation. I recommend checking Airbnb if you decide to do this. Many hosts offer weekly and monthly discounts.
- Cook your own food- Rather than eating out, cook for yourself. It’s cheap and easy to make basic meals like sandwiches, salads, or pasta. It’s pretty easy to cook yourself a meal for $5. A meal in a restaurant might cost $15-$25.
- Take advantage of credit card points- Credit card companies offer generous introductory offers when you sign up. You can also earn points for all of your travel expenses. You could save a few hundred dollars or earn a free flight if you pick the right card. You can save money by signing up for a travel credit card.
- Find ways to reduce fees- Use a credit card without foreign transaction fees or ATM fees. I use the Schwab bank debit card.
- Take advantage of free attractions- You can often visit museums, parks, and beaches for free. For more ideas, check out my guide: 30 free things to do while traveling.
- Shorten your trip- If you aren’t willing to make any sacrifices in terms of comfort, you can always simply travel for a shorter period of time.
- Wait and save more money- Maybe your desired trip costs $10,000 but you only have $8,000 saved for your trip. Consider postponing your trip for a few months to save more money.
My Travel Budget Philosophy
While planning my first trip abroad, I had no idea how much money I would spend. I bought a round-trip plane ticket and a Eurail pass and set off without making a budget. During my trip, I didn’t really overspend but I was constantly worried about running out of money. Over the next 10 years of travel, I learned how to budget.
I’m naturally a pretty frugal traveler. I take my personal finance seriously. I walk to save on transportation. Sometimes, I travel by night to save on accommodation. I cook my own meals instead of going to a restaurant. The less I spend, the longer and further I am able to travel. One area I splurge is accommodation. I prefer to stay in a private hotel or Airbnb rather than hostels.
While making a travel budget for international trips, I try to be very conservative. I overestimate every expense by 20% or so. This gives me a bit of cushioning if things are more expensive than I expect. I prefer to spend less rather than underestimate my cost and overspend or run out of money.
With that being said, I don’t like to miss out on anything. There is no point in going somewhere if you’re just going to sit around the hotel all day trying not to spend any money. There is a difference between cutting back on luxury and cutting back on experiences. I much prefer to spend money visiting a national park, museum, or concert than staying in a fancy hotel or eating a nice meal.
To Wrap it Up: How to Make an Accurate Budget for Traveling
Unless money is no object, it is a good idea to make a travel budget before setting off on a trip. If you have a travel budget, your trip will go smoother and you’ll end up saving money.
The first time you make a travel budget, it may take you a couple of hours. You’ll spend the majority of your time researching the costs of flights, hotels, and activities. After you get the hang of it, you could make a rough trip budget in 20 minutes. You can also save time by creating a budget while you plan your trip. Simply take note of costs as you research.
The level of detail that you need to go into with your budget depends on how good you are with money. If you’re good at personal finance, you can just keep a simple budget. If you’re a spender, you’ll have to track your expenses more closely to make sure you don’t overspend.
Just having a budget isn’t very helpful. You have to stick to it. During your trip, don’t forget to track your budget periodically as you go. Make spending adjustments as necessary. Wherever you’re traveling, I hope this guide helps you stay on budget and save some money.
Do you make a budget for traveling? Share your tips in the comments below!
For more help budgeting, check out my Guide to Ultra Low Budget Travel on $10 Per Day
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