Travel Budget and Finances

When considering serious long-term travel, it’s important to plan a REALISTIC travel budget for the amount of time you’ll be away.

There are many different ways to plan a travel budget, and the key is to adjust it as you go.

If you travel for long enough, you will change as a person, your interests may change, and therefore your travel budget will need adjusting.

If you haven’t traveled much before, and you don’t know where to start, then go through the information below which will help you! Then sit down and create a rough budget for your travels.

Also, knowing where you want to go, and the costs associated with those countries is important.

By knowing how much you will need per day, you can then divide that into your total balance, and that will give you a “rough” idea of how many days you can travel for.

For your travel budget factor in things like:

  • whether you plan to work at all.
  • any courses you may take.
  • any once-in-a-lifetime treks or events you may do.
  • any splurges or shopping, etc.

All these and other miscellaneous activities will affect your money for travel.

Steps for preparing your travel budget:

  1. Saving for your travels
  2. Getting there and coming home
  3. Average Daily Costs per Country
  4. One-time Country Costs
  5. One-time trip costs
  6. Staying in touch
  7. Entertainment
  8. Splurges and emergencies

1. Saving for your travels

  • Free yourself from as much bad debt as possible. You don’t want any unnecessary debt hanging over your head both financially and emotionally whilst you are on the road.
  • Save some money before leaving on your travels.
  • Go through your expenses and simply cut out what is not completely necessary. Know where your money is going. Write down everything you spend your money on a daily and weekly basis.

All the little things add up. Trim the fat and re-evaluate your living choices. This will be good practice for when you are on the road.

Self-discipline is key: if you have a big enough desire to do something, like travel around the world, small sacrifices in your spending habits want be too hard!

Steps you can take to save money for travel:

  • Have a set amount from your paycheck automatically deposited into savings.
  • If you are a couple, try living off one wage and saving the other. We did it.
  • Take your lunch to work instead of buying it each day.
  • Cut back the daily cups of coffee.
  • Cancel your magazine subscriptions.
  • Cancel your cable television service.
  • Cut back on luxuries like taxis, dinners out and high priced drinks. 
  • When going out partying, take a fixed amount of cash and leave the ATM card at home. 
  • Transfer tax returns and bonuses directly into your savings accounts.
  • Sell all the useless crap you’ve accumulated over the years on Ebay, craigslist, or Gumtree (You wont have to worry about storing  it whilst away.)
  • Reduce storage costs by asking family and friends to adopt or store any possessions.
  • Consider moving back in with your parents for a while, or take in a room mate.
  • For many months before leaving just lay low for a while.
  • Pick up extra work some where.
  • If leaving a car behind, contact your auto insurance and give them a date to put your policy into “park” mode which will greatly reduce your premiums on a vehicle that is not being driven.
  • If leaving a mobile phone at home, contact your carrier to see if they can put your plan into a suspended mode.
  • If someone will be looking after your pets, start making visits to get the animals and the person comfortable with each other.

2. Transportation tips

It is essential to shop around and search for cheap flights and start looking as early as possible.

3. Average daily costs per country

This will be greatly affected by the regions and countries you visit, and what comfort levels you need.

Choosing cheaper regions like South East Asia, Africa, Eastern Europe, South and Central America will lower your costs dramatically compared to regions like Australia /New Zealand, Western Europe, North America, and Scandanavia.

By going to developing countries, your money will go a lot further and you can spend more time getting to really know a place.

Bearing this in mind, you could end up with a more varied and interesting itinerary and a richer travelling experience.

Begin by outlining the number of countries you plan to visit and for how long. The three biggest expenses of any trip will be:

  • Accommodation
  • Transport
  • Food

Budget accommodation tips:

  • In hostels try and avoid double rooms. Stay in a dorm room in developed countries as these offer much better value for the solo traveler. And it’s a good way to meet people.
  • In developing countries your own room is more realistic. And consider lugging a small tent around. That’s what we did for 4 months in Africa. Many hostels will let you camp in their grounds and use the facilities for a cost less than a bed.
  • Do your accommodation research by checking out our Budget Accommodation page!

our private room in China

Transport

  • Try not to move around too much. The best way is to spend a longer amount of time in fewer places. One of the great benefits of spending more time in fewer places is that it costs you less.
  • Transport, whether it’s buses, trains or flying can really eat into your budget. The other thing is, you won’t suffer from burn out as much. So avoid overspending and burnout by prioritizing your over land commitments and focus on getting to know one region well.
  • Public transport can be cheapest way to get around. Travel like the locals. We did it through Africa for 5 months from Uganda to Cape Town. We traveled by public bus, train, ferry, and pick-up truck.

It was cheap and we got to meet the locals and get off the “Lonely Planet” path and into the small towns and villages.

We could go at our own pace, whilst the “Overland Truck Tours” would race through each place not really getting the chance to take it all in.

  • When you do travel by other means, try and share a car with another traveller. Also, sharing  a Taxi, mini-van, and tours etc are all more cost-effective when there’s a group of travelers to split the costs.

We did it many times and made new friends along the way. Consider a car in countries like Australia and New Zealand because there can be potential savings.

  • If you are solo, put up notices in all the hostels you are staying at stating you have spare seats. Splitting the fuel costs will help a lot.
  • Walk. Get active and see things at a slower pace, and walking is always FREE…OR….Rent a bike – cheap price, more comfy, faster pace.
riding a tuk tuk in Laos is cheap!

Eating on the cheap:

  • Try and avoid touristy restaurants. Just go one street or one block over and it will usually be much cheaper and more authentic! And when dining out, go for breakfast or lunch. Avoid dinner as restaurants raise prices.
  • In Asia the night markets are great places to go for a meal. They are very cheap and great places to meet other travelers and locals.
  • Eat from the street carts and vendors. It’s cheap, and the great thing is you can see what is actually being cooked and that it is cooked fresh right in front of you.
  • In developed countries, self-cater where you can. Hostels worldwide come equipped with kitchens and a refrigerator. Purchasing your own supplies from the grocery store will save you big bucks.
Lunch with a local in China
Lunch with a local in China

Travel budget tips:

  • When looking to eat in restaurants, make sure they are busy and the locals dine there as well. That way you can be sure the food is usually safe to eat.
  • We like to book our first nights accommodation, especially if we are just arriving after a long flight or bus journey. The last thing you will feel like doing is wandering around town with your backpack trying to find a place.

Then, the next morning you can check out other options.

4. One time country costs:

  • How do you plan to get around your countries of choice, and how extensively? Think about the costs of internal flights, buses, boats, trains, taxis, tours, courses or activities etc…Bearing in mind that some tours and courses usually include food and lodging.
  • Many countries require that you get a visa (either before or upon arrival) and the costs vary country to country. Check out visa requirements here, or by visiting each country’s Embassy website

5. One time trip costs

  • Whether you are flying on various airlines, or have a RTW ticket, this is a big part of your upfront budget. Shop around. See our Cheap International Flights page!
  • Having Travel Insurance is absolutely crucial. We use World Nomads who also come recommended by Lonely Planet.

A good policy covers you for the duration of your trip to all your destinations, work abroad, any sports and activities you might do including winter sports, your medical expenses, repatriation, travel and accommodation if you fall ill, reimbursement for lost, damaged or stolen items, personal liability, and legal expenses.

  • Include any items you plan to purchase before departing such as a backpack, camera equipment, laptop, and clothing etc

6. Staying in touch

These days, there are many options. See our Staying in Touch page!

7. Entertainment tips

This is the one area that you can easily blow your daily budget with, but hey, we need to have fun right or what’s the point.

When once-in-a-lifetime opportunities like Hiking to see the Gorillas, White Water Rafting the Nile, or partying for a week at Oktoberfest are on offer, it’s difficult to lay around all day reading or listening to your iPod!

Our Gorilla trek in Uganda cost us $600 ($300 each) for just 1 hour spent with the Gorillas. And that amount of money could have lasted us weeks in Africa, but it was an amazing experience and a once in a lifetime opportunity.

Whilst for most people it’s not possible to do everything, at the end of the day, we travel to experience all that is on offer. Just prioritize.

When we spent 5 months backpacking Africa, there were heaps of safari’s on offer, but to do them all would have really stretched our finances. So we just researched and chose the one’s that best fit our interests.

There are dozens of free or cheap entertainment options in almost every country around the world.

  • DIY hikes
  • Renting a moped
  • Exploring local markets
  • Walking around town taking photos
  • Free movie screenings in local cafes and hostels
  • Visit a free museum
  • Volunteer
  • Chilling on the beach with a good book
  • Bike riding
  • Climb a local mountain with views of a city or coastline
  • Catching up on your blogging or facebook
  • and of course…making the most of Happy Hour!
Biking in China
Biking is a cheap option

One of our favourite things is just wandering around town, talking with locals, and people watching. It’s a great way to soak up the local culture.

Just decide which activities are absolute musts and budget accordingly! And it’s always wise to keep a money journal to track your spending habits.

8. Preparing for splurges and emergencies

Have enough cash or available credit to cover an emergency flight home from any location you plan to be in.

While it’s not advisable to rely on credit cards, they could prove useful in case of an emergency.

Arranging to obtain your credit card with your bank before traveling might save you a lot of hassle in the future.

Do you have a safety net in case you run out of money? Find out about the availability of any seasonal work before you leave home.

In Summary

Revisit your travel budget often during the travel planning process and whilst you are on the road.

Run various scenarios to see what your options are, and just know that you will always have options.

  • Learn to live without luxuries. It’s great living with little possessions.
  • Book overnight flights, bus and train journeys to save on accommodation costs.
  • Negotiate! Negotiate! Negotiate! It’s pretty common in third world countries, and they can only say no.
  • Pick up odd jobs: Hostels looking for help behind the bar, or cleaning jobs, or a scuba company looking for a new dive master etc.
  • Volunteer: Some organizations charge high fees, but there are several that don’t and costs usually include food and accommodations. It’s a great way to give back to a local community!

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