5 Essential Budget Travel Tips: Traveling on a Budget

FT Contributor
A travel planner leans against a jar that is full of money and labeled "travel."
Reading Time: 6 minutes

Traveling can be filled with excitement and adventure. However, taking trips without a thought for the costs can end in disaster.

A poorly planned trip, unexpected expenses, and a lack of proper time spent saving can all lead to financial stresses and strains that may have you wishing you never set foot on that plane or cruise ship in the first place.

These tips will provide you with important information to help you plan ahead for all of your travel expenses.

How to Budget for a Trip

The three major elements of a proper travel budget are:

  • Determining your traveling expenses.
  • Creating a savings plan for your trip.
  • Make sure to maintain an emergency fund for when things get tight.

Here are each of these elements broken down in detail:

Travel Expenses to Consider

The first thing you’re going to want to do is come up with a list of your potential expenses.

Try to take everything possible into consideration, from obvious expenses like transportation and accommodations to minor yet important essentials that can add up quickly, like snacks or pet care.

  1. Passports and visas: If you’re traveling overseas, make sure to budget in the cost for your passport and any visas that may be required. These expenses can vary dramatically. Passports can cost $150 or more, although passport cards (used for travel to Canada, Mexico, the Caribbean, and Bermuda) are closer to $65. The cost of a visa depends on the location. Make sure to sort these concerns out well ahead of time, too, as the application for either a passport or a visa can take weeks to process.
  2. Airline, train, or boat tickets: You’re going to need some form of transportation when traveling. Depending on your destination, this could be a plane, a train, or even a boat. All of these options include significant costs that should be considered.
  3. Gas: Sometimes the best transportation option is your car. When this is the case, you’re going to need to plan for gasoline costs. This isn’t necessarily a simple calculation. Estimate your vehicle’s average miles per gallon, the distance you’ll be traveling, and the average price per gallon of gas in the specific locations you’ll be visiting. This last one is important, as it can change dramatically, depending on where you are as well as the time of year that you travel. The Department of Energy provides a good trip calculator to shorten the work.
  4. Vehicle maintenance: Along with gas, if you’re driving your own vehicle, factor in the cost of vehicle maintenance before and after your trip. A drive from New York City to Houston, for instance, would be over three thousand miles, and would likely require an oil change both before and after your journey.
  5. Rideshare and car rental costs: Even if you don’t bring your own car, you may have transportation costs once you arrive at your destination. Rideshare service fees, rental car costs, and even the use of public transportation should be added to your budget.
  6. Meals and snacks: Food costs can add up very quickly. A nice meal for two can easily top $100 and ten of them in a row is a significant expense. Consider the potential cost of each meal, along with the snacks and drinks  between them.
  7. Accommodations: The cost of lodging is one of the largest portions of most travel budgets. Whether you’re keeping things cheap by sticking to motels or campgrounds, or you’re planning on living it up by visiting five-star hotels, your accommodations will add up to a significant portion of your overall costs.
  8. Child and pet care: If you plan on leaving kids or pets behind, chances are it’s going to cost you something to have them well-cared for. As a cost incurred by your vacation, this should be factored into your budget.

Create a Savings Plan

Once you’ve calculated all of your approximate expenses, you’re ready to create your savings plan. This is quite simple, although there are a few things to keep in mind. Make sure you are considering all of your expenses. Don’t brush little costs under the rug — they’ll add up before you know it.

Once you have a grand total, divide it by the number of paychecks that you’ll receive between now and your vacation.

Say you’re a proactive planner who is budgeting your trip 10 months in advance. You are paid a monthly salary, and you calculate that your vacation should cost approximately $4,500. This means you should be saving $450 out of each monthly paycheck in order to have the money you need 10 months from now.

Maintain an Emergency Fund

An emergency fund can help with a variety of unexpected expenses, including events that may take place while you’re on vacation. As you go about setting aside money for your upcoming trip, make sure that you either start or maintain an emergency fund as well.

Having a fund that typically covers at least three to six months of income (and ideally closer to nine months to a year) can help ease any unexpected costs while you’re on vacation. An emergency fund is essential for unpredictable scenarios, such as a trip to the hospital or unforeseen travel costs.

In addition, if you find that, even with careful planning, there are unexpected expenses after your trip, you’ll have a way to cover them. Having a well-stocked emergency fund to fall back on if the need arises gives you peace of mind both during and after your travels.

Budget Travel Tips

Along with preparing for your travel costs by saving beforehand, it’s also important to avoid unnecessary spending on your travels.

1. Research Your Travel Options

It’s always worth taking some time to gauge which travel option will work best for you. For instance, rather than simply booking a plane ticket, search some of the cheap travel sites like KAYAK or Travelocity first in order to find the best deals.

In addition, if you’re traveling somewhere accessible by land, take the time to map out the costs (gas, vehicle maintenance, food) to drive there. Make sure to account for accommodations if it’s going to be more than a day of travel. Even with all of these considerations, there’s a chance that driving could be cheaper than flying.

2. Leverage Low-Cost/Free Transportation at Your Destination

Along with looking for affordable ways to get to and from your destination, it’s wise to look for the cheapest option for transportation once you’re there.

While it’s easy to simply rent a car, utilizing public transportation may be a much cheaper alternative. If you can access local trains, monorails, subways, or even bicycle or scooter rentals, it may cut down on your costs significantly.

Even if public transportation isn’t an option, consider using rideshare apps or walking if possible.

3. Explore Cheap Travel Destinations

Tourist destinations may be all the rage, but they’re also expensive. If you’re looking for low-budget ways to travel, consider visiting some affordable destinations.

  • Jamaica: While Jamaica is traditionally an expensive, resort-focused experience, visiting the capital city of Kingston is a trendy, affordable way to add some of that island flair to your travels.
  • Atlanta: Georgia’s capital city is a hotspot of Southern hospitality. Its position as an airline hub means airfare is cheap, and the city is filled with high-quality, low-cost entertainment.
  • Montreal: Montreal is a blend of modern living and deeply rooted culture and history. This Canadian city has a huge selection of affordable Airbnbs that make a visit both simple and cheap.

The Two Biggest Travel Blunders

Even if you plan everything perfectly in advance, things can still go wrong if you’re not careful. Here are two essential elements to avoid while traveling:

1. Poor Cybersecurity Practices

Tourists and travelers are frequent targets for cybercriminals, and the need to use your personal and financial information in unknown areas can be unsettling. Take the time before you travel to research good cybersecurity practices, such as:

  • Setting up a unique password for every one of your devices.
  • Turning your phone off while going through border control.
  • Turning two-step authentication on for your passwords.
  • Using only encrypted network connections.
  • Deleting apps that you don’t need as you’re traveling.

2. Ignoring Travel Insurance 

Travel insurance is always a good idea if you’re going to be doing any significant traveling, especially internationally. According to the Centers for Disease Control and Prevention, there are three travel-related insurances you should consider:

  1. Trip cancellation insurance: This allows you to make last-minute changes to your travel plans if necessary.
  2. Travel health insurance: This allows you to use the healthcare system in other countries without having to worry about whether your own personal health insurance will cover the expenses.
  3. Medical evacuation insurance: If you’re planning on traveling in an area with a below-average healthcare system, you can purchase this insurance. It covers the cost of emergency transportation that may be required to quickly move you to a location with better healthcare in the event of a medical emergency.

Whatever specific insurances you choose to use, it’s wise to consider your options before heading out on your travels.

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