“Our goals can only be reached through a vehicle of a plan, in which we must fervently believe, and upon which we must vigorously act. There is no other route to success.”
- Pablo Picasso.
Saving for travel begins and ends with a travel budget.
When you set goals for saving and spending, you start turning an idea into a reality.
But if you’ve never made a travel budget before, it can be tough to know where to start.
Don’t worry, this guide’s got you covered.
Here you’ll learn what to include in your travel budget, how to put it together, and how to work out exactly how much you need to save.
- Why travel budgets are so important
- How to plan and build a travel budget
- Pre-flight expenses
- Holiday expenses
- Emergency fund
- How much to save for a trip
- Take the stress out of saving for travel
Here we go!
Why Do I Need A Travel Budget?
"A budget is telling your money where to go, instead of wondering where it went."
- Dave Ramsey.
To make travel more affordable, you need a budget to follow.
Good travel budgets allow you to know exactly how much you need to save for a holiday and ensure you save enough in time to afford your whole trip.
It doesn’t matter what your budget looks like, so long as you stick to it.
How to create an effective budget for travel:
- Make a list of all your pre-flight expenses and their costs.
- Add any costs and expenses you can expect from your trip.
- Include an emergency fund in your travel budget.
- Work out how much you need to save in total.
- Determine a monthly savings goal.
Let’s take it step by step.
How To Plan And Build A Travel Budget
“A budget doesn’t limit your freedom; it gives you freedom.”
- Rachel Cruze.
Step 1 is working out what all your expenses will be.
This doesn’t just mean food, accommodation, and flights.
There are also some hidden costs related to travel that we’ll touch on soon.
Vacation expenses can be broken down into three categories:
Each of these categories needs to be calculated and added to your total budget.
Here’s how to do that.
A travel budget should cover the entire process - not just the trip itself.
There are a few expenses to consider before the wheels leave the tarmac.
Some depend on your destination, personal preference, and length of stay. Others apply to every trip.
Here are some common pre-flight expenses to add to your travel budget:
Airplane ticket prices are always changing. If you wait too long to get them, they can end up being the most expensive part of your trip.
Book as far in advance as possible to get the best deals on flights.
Research the baggage policies of any airlines you’re taking. If you need to buy a new suitcase or backpack, include it in your travel budget.
You may need to apply for a visa to enter your destination country. Not all visas are cheap, and it’s best to apply for them as early as possible.
Check government websites for information about travel visas and their cost.
If you’re going somewhere with extreme weather, you might need to buy new gear. Make a list of all the clothes and equipment you’ll need for your trip and add it to your total expenses.
- Travel insurance
While not everybody invests in travel insurance, it’s highly recommended for first-time travelers. In certain countries, it’s even compulsory in order to gain entry.
Shop around for the best deals before you add this to your expense list.
- Immunizations and COVID-19 tests
Some countries require certain vaccinations and negative-result COVID-19 tests from tourists.
Find out the entry requirements for your destination and get quotes from medical centers to determine how much you’ll need to spend.
Here’s a simple pre-flight travel budget example made using Google Sheets:
Take into account any you-specific purchases you need to take as well. This includes personal medication, a new passport, and a taxi fare to the airport.
Holiday expenses to prepare for
It can be tricky to estimate how much your trip will cost before you go.
Most of the time, travelers end up spending more than they expected.
By taking into account every expense before traveling, you greatly increase the accuracy of your travel budget.
Common vacation costs to include in your travel budget:
Search the towns and cities you want to visit on booking platforms like Booking.com and Hostel World. Work out an average nightly cost in each place then multiply it by the number of days you’ll be there for.
Find out how much public and private transport cost in your chosen destination and multiply the costs by how many times you think you’ll need to use one.
Remember to include a little extra for emergency taxis and times you catch the wrong bus or train by accident (it happens).
- Food and drink
Look at your current eating and drinking habits and budget as if they’ll continue when you’re away.
We often forget about all the mid-afternoon snacks, drinks bought at bars and nightclubs, ice-creams in the sun, and other holiday purchases. Try to account for as many as you can.
Are you going on a relaxing break or an adventurous expedition?
How many non-free activities or tours do you expect to do?
Research the costs of activities in your destination and add the total to your budget.
- Personal purchases
It’s easy to spend money on small things without thinking about it while you’re on vacation.
They might not cost a lot individually, but these small purchases can add up.
Here are some common personal expenses to add to your travel budget:
- Active subscriptions (Netflix, phone plans, etc.)
- Gifts for friends and family
- Sim cards and credit
- Entry fees (natural reserves, nightclubs, museums, etc.)
- Massages, haircuts, manicures, pedicures, etc.
- Towel rentals
You don’t need to work out an exact figure for each of these items. Just try to create a rough estimate based on your regular habits.
- Replacements and repairs
Buttons come off shirts, cellphones stop working, sunglasses break, socks don’t come back from the laundromat…
The list goes on.
If you’re going on a short trip, you may not need to get things replaced immediately. But if you’re traveling for months at a time, that lost pair of nail clippers can’t wait forever.
Add around $50–100 USD to your travel budget for each month you wish to travel for. You may wish to add more if you’re going to be moving around a lot.
Your travel budget should now look something like this: