Creating a Travel Budget

It’s just like taking the bitter with the sweet – we love to travel, but sometimes we hate having to plan, especially from a financial perspective. Creating a travel budget can be a difficult task, particularly if you haven’t travelled before. Whether you’re going on a trekking holiday in Bolivia, your holiday style is a serviced apartment in Sydney or you’re planning to stay in a hostel dormitory in Athens, you’ll need to combine careful planning with lots of research.

Budget Basics

The best thing you can do with a budget is overestimate – rather than underestimate. It’s always better to have money left over than be strapped for cash or in debt at the end of your trip. To begin with, set yourself a maximum budget for your trip, as this will help you figure out where to go and how long to go for.

Where to Go?

You’ll need to make some decisions about which destinations are calling to you and look into basic costs in those countries. If you have a smaller budget, for instance, you might find travelling around Asia is entirely affordable, but that Europe is just not financially feasible.

Software

The easiest way to create a budget is to use a software program. Doing your budget on bits of paper will only lead to chaos. A software program will ensure that your numbers always add up correctly. You can use something as simple as Microsoft Excel or find a free budgeting application online.

Flights

Research flights to your desired destination. Look into the options with various airlines and note down their costs. If you’re travelling to a handful of countries, you may be better off getting a round-the-world ticket instead of several flights. Deduct the flight cost from your overall budget and see how much you have left. The remaining budget will need to cover lodging, transport, food and spending.

Accommodation

Finding the right accommodation takes lots of research, so shop around on budget sites and speak to a travel agent if necessary. If you’re planning on staying in one location for a while, you might find a serviced apartment is more affordable than a hotel.

The best way to determine your accommodation budget is to:

• decide what level of accommodation you want (are you a hostel person or a 4-star-hotel person?)
• look into the average hotel costs at your destination/s for the level of accommodation you choose
• then, multiply the average cost by how many nights you’ll be staying.

This will give you a good idea of how much your accommodation will be overall – remember, overestimate rather than underestimate.

Travel and Transport

If you’re travelling through various countries, you may find that additional travel and transport costs can add up, too. Options for travel include plane, trains and ferries/boats and you may find some cheaper than others. If you have lots of overland travel to do between countries, you may find a multi-country train ticket works best. However, if you’re travelling around Australia, for instance, you may be able to find cheap flights between cities with carriers like Jetstar and Virgin.

Food and Drink

You’ll also need to set aside a budget for a daily food-and-drink spend. Again, your preferences will come into play here: do you love cafes, 5-star dining or are you happy to simply eat fast food from street vendors? Research travel sites or talk to other travellers who’ve been to your destination about how much they think meals generally cost. If you want to save money, consider booking accommodation that has breakfast included. This will mean one less meal you’ll have to fork out money for.

Daily Spending

Daily spending is really dependent on your personality, but you should always factor in costs for souvenirs and other expenses. You might find yourself in a sticky situation (for example, you might get sick and need to go to hospital) or you might want to check out a museum that has a $20 entry fee. Either way, having extra cash on hand can never be a bad thing.