For most people, the biggest part of your budget for a trip are your daily costs. They are both the hardest to quantify and the easiest to control. For your upfront costs – check out my earlier article
Basic Travel Budget Items
Over many years I’ve budgeted based on the following five categories: accommodation, food, activities, local transport and gifts or purchases. In order of priority.
A roof over your head is nice, though not entirely essential, smart use of overnight transport can save you here, as can visiting relative, friends and strangers via couchsurfing.com. The amount you spend on accommodation will reflect your other costs as well. If you are staying in a nice 5-star hotel, unless you make a bit of effort you will likely be paying a premium for everything from tours to food to laundry service. In many countries a taxi picking you up from a fancy hotel will negotiate a higher rate than one picking you up from the backpackers!
This is not hard to avoid though, staying in a pleasant, but expensive 3-star hotel in Myanmar, we walked around the corner and booked an all day tour at a cut-price rate from the towns leading cheap hotel. Staying in a nice resort in Vietnam, I walked up the road with a bag full of dirty clothes to find cheap laundry (if the laundry is priced per an item it’s almost always too expensive, cheap places will charge per a kilo or per a load).
Estimating your budget is fairly easy, using the big travel sites such as hotelscombined.com will give you an accurate idea of costs.
Again almost totally variable, depending on your needs and wants. If you eat a restricted diet that’s not common in the country you are travelling will cost you more e.g. a vegetarian in Argentina, or a low-fat enthusiast in France. Self-catering will generally save you a lot of money in developed countries, though not always in other countries. It’s easier to eat in local restaurants and on the streets in Thailand than to try to self-cater. Cheap apartments for the locals don’t have kitchens, so most locals eat out all the time. If you are keen on eating out but don’t have the budget, consider eating out for lunch and not dinner, lunch specials can be quite common, particularly in Europe.
Quite regularly, when travelling, I end up eating only two meals a day, eating three times, just seems to take up too much time! In some countries the breakfast buffet will keep you from eating until well into the afternoon!
I also make sure I have enough money to do the activities I want to do. On a trip to London my partner wanted to see the Churchill War Cabinet Rooms, we arrived and he was shocked at the entry price (I’d looked it up on the Internet I wasn’t surprised). Do we really want to pay £17 each, he asked? That’s not the right question, the right question, do we want to pay for airfares to London again in the future to see this museum? We did see the museum, and it was a highlight of the trip.
If there are activities you know you want to do in advance: a rock climbing course in Nepal, SCUBA diving in Asia, then budget for it separately.
If most of your time is on the beach or hiking, then your activity costs will be minimal. In contrast if you are spending time in cities, they can add up quite quickly.
Researching these options can save you plenty of money. In Europe I will generally catch a bus or local train from the airport, saves a fortune over taxis, and is often not that much slower depending on the time of day. In some circumstances hiring a car can be cost-effective because of the mileage you can cover in a short time, but don’t pick up a car on arrival in London or New York, unless you are immediately leaving the city. Instead pick up the rental at the end of your stay.
Local transport passes can be good value in the developed world, but again research in advance. Don’t be fooled by the often advertised “tourists passes” which combines attraction entries and local transport. These can be a good deal, or they can be a total rip-off. The Internet is your friend.
Souvenir shopping is the first budget item to disappear if I’m over-spending in the other categories. Souvenirs are nice, but there is truly little that you can’t buy at home thanks to the world’s globalised economy.
How to Plan Your Daily Budget
Travelling as a couple, eating reasonably and drinking moderately we generally end up spending a similar amount for food as I do accommodation. Again I generally average out activities PLUS local transport as equal to the accommodation budget (for two). Excluding big-ticket items like dive courses and hot-air balloons.
Make It Meaningful
If you are planning a 12 month trip – then an average daily budget is close to meaningless. If you are doing a 3-week trip to Europe it makes more sense. The most obvious split is to budget different amounts in different countries. But it can be more subtle than that. Anyone who has visited or lived in England will tell you that London will cost you twice as much as the rest of the country. The same cane be said for most countries – your costs will be highest in the biggest cities.
The longer you stay the less your daily spend will be as well. Book a month at a beach and first you’ll get a good deal on accommodation, you’ll discover cheaper places to eat, spend less on transport and less on attractions.
How To Control Your Budget
The longer you stay the less your daily spend will be as well. Book a month at a beach and first you’ll get a good deal on accommodation, then you’ll discover cheaper places to eat, spend less on transport and less on attractions.
The key to sticking to budget is monitoring it and making adjustments as you go. Having your daily budget in cash makes it a lot more obvious when you are over-spending. Alternatively there are some now great apps that will help you monitor your budget as you travel, and even help you sharing costs between a group if that is how you are travelling. I usually average a budget over a week too, there are always unders and overs and remember that pre-paying, for example a hotel bill, doesn’t mean that today’s budget is blown! It’s just you’ve spent some money in advance.
If the budget is unravelling the first places I look to economize is shopping, then accommodation and food. If you can’t afford any of the activities in the area, for me it raises the question, why are you here? I’ve met plenty of backpackers saying they don’t have the money to see the local famous museum/ruin/location, but then spend the night drinking heavily. It doesn’t make sense to me, you can drink at home, you can can’t see the Angkor Wat at home!
For more tips on saving, managing and spending your money on travel check out my The Non-Boring Travel Money Guide