How To Create A Realistic Travel Budget

Let’s be real, when it comes to travel, money matters. I’m an advocate for travel but I’m also an advocate of being financially responsible (to be well heeled is to be financially stable its part of my blog name for a reason). As you decide on your destinations, one of the first steps is to create a realistic travel budget to avoid the disappointment of canceling a trip, or the shocking surprise of returning to an empty bank account. I’ve suffered from both but you don’t have to!  Here’s how to come with a realistic travel budget in 5 steps and avoid the mistakes from previous trips that may have you worrying about money on vacation:

1. Determine The Number of Travelers

There are certain costs that you’ll have to incur on your own and there are others that will be impacted by the number of travellers in your group. Traveling with others will/can significantly reduce costs on accommodation and car rental for example.

2. Identify All Cost Categories

An easy way to go over budget or create an unrealistic travel budget is to make an incomplete budget. Then, when you track costs at the end of the trip and it is way more than expected because you weren’t set up correctly in the first place. I can help you avoid that. When I start planning a trip, I first come up with an overall  number I’m comfortable spending on the trip. Then, I check how realistic that number is by allocating to each budget category based on my research.If I find that my budget is not enough, I look for ways to cut the budget, or consider another destination. 

• Depending on your trip, categories could include:
• Visa and travel planning related costs,
• Transportation to Destination (including luggage and seating fees),
• Transportation at Destination and Between destinations,
• Travel Insurance & Immunizations,
• Travel Gear,
• Accommodation,
• Meals,
• Activities,
• Souvenir/Gifts/Fun Money,

3. Clarify You Vacation Style For Each Trip

Is this going to be a budget trip or will this be somewhere in the middle or all out luxury? One person can plan a week in Paris for $1000 and another person for $10,000. We’re all different and we travel differently at times. Knowing the answer to this will shape up how you build on YOUR budget in each category identified above.

Tip: You can have a budget trip with a splurge on one or two things that are important to you during the trip. On my first backpacking trip, I travelled on overnight buses twice to save on transportation costs and hotel. On the same trip, I stayed in hostels with the exception of 2 places where I treated myself to nice hotel stays!

4. Create A Realistic Budget In Each Category

Next, you’re ready to determine your realistic travel budget in each category by answering the following questions and doing some research. 

Visas & Certain Pre-Travel Expenses

• Will I need a visa?
• How much will It cost?
• Will I need to mail my application (including mailing fees in Budget)
• Will I be paying for a trip planning service?

Source of Information

• Destination’s consulate website (in your country of residence)
• Request quotes from your favourite travel consultants

Travel Insurance

• Will I need insurance on this trip? (Hint: Yes you do)
• Am I up to date on my immunizations?

Source of Information:

Shop around for your best option but pay attention to coverage

Call your travel clinic; let them know your destination. Get a cost estimate for immunizations

Travel Gear

• What Do I NEED to Buy For This Trip? (Think camera, luggage, hiking boots, clothes, new bikini, camping gear etc.)
• What Do I WANT to buy for this trip

Source of Information

This will depend based on what you’re shopping for. This is a budget category that tends to be flexible. When on a tight budget, focus on your needs over your wants!

Transportation to Destination

• How will I get there?
• What are my travel dates?
• How flexible are my dates?
• Will I have to pay for seats and For luggage?
• Do I have miles to redeem for this trip?
• Am I travelling coach, premium economy, business or first?
• Am I open to layovers?
• What’s my maximum number of stops?

 

Source of Information

·      Airfare: Often the largest cost, it is important to search for flights in advance. Use different aggregator sites, try different dates, and check airline websites directly to come up with airfare estimates, check your mileage balance.

·      Rental Cars: Try options for different day combinations depending on your location. Again, aggregator sites may have deals.

·      Driving: Look into estimates cost of gas/petrol based on the length of your drive.

·      Extras: Look into the cost of selecting seats and paying for luggage or decide if you’ll travel light and sit anywhere

Transportation On The Trip

• How will I get to and from the airport?
• What are my options for travelling between destinations on a multi-destination trip?
• Is public transportation an option?

Source of Information

• Ask family and friends for a ride to the airport and save on that Uber trip
• Decide on how to get between destinations based on cost, convenience, and time
• Run a Google search on public transportation at your destination to see if this is an option for you (for example, public transportation is THE BEST way to get around London and New York, but not so much in Houston!)

 

Budgeting For Accommodation Costs

• How many nights of lodging will I need?
• Am I staying with family or friends or will I couch surf?
• Will I stay in hostels, Airbnb or hotels,
• What’s my maximum amount per night?
• Where do I want my accommodation to be located?
• Do I have gift cards/points I can redeem towards accommodation?
• Am I splitting costs with others?

 

Source of Information

• Use sites such as Trip Advisor, Airbnb, Hostel World, or Booking  to find accommodation options that best suit your needs.

Activities

• Can I afford to pay for activities on this trip?

• What are my musts vs. my wants on this trip and how much do they cost?
• What free activities are available to me?

Source of Information

• Look up free activities at your destination from free museum days to free walking tours.
• Google ‘free things to do in ‘destination’ 
• Do a search on activities on Trip advisor or Lonely planet (or on your favorite travel blog), contact the vendor for pricing, and decide on which activities to undertake

Meals

• Is this a foodie trip? Do I have specific ‘must-eats?’
• Is free breakfast included with my accommodation?
• Will I cook on this trip to save money?

Source of Information

• Look up the cost of a meal at your ‘must’ eat restaurants using their website or trip advisor
• Look up average meal costs in the destinations to come up with a meals budget per day

Fun Money – (Shopping, Souvenirs, Gifts, & Splurges)

• Will I be buying gifts or souvenirs on this trip?
• How much other ’fun’ money am I willing to put aside?

Source of Information

• No research is generally needed unless you’re splurging on a specific item. Come up with a general amount for this budget category

5. Leave Room For Flexibility Within Your Travel Budget

If you’ve created a budget using the 4 preceding steps, you’ve done great! Keep in mind that while certain costs are fixed, it is a good idea to leave room for some flexibility within your travel budget. Decide on your must have’s and skip the ‘nice-to-have’s.

I sometimes skip shopping on trips or have traveled by overnight bus between cities when on a tight budget. Other times, I’ve limited my choice of activities to align with my budget. Leave room to go over on one category and then find ways to cut down on another.

With these tips in mind, you’re on track to avoid the unpleasant surprise of going over budget during your travels this year. Now, go forth and prioritize, cut out the wants, and have the time of your life on your vacation without jeopardizing your financial health.

A Gift – A Realistic Travel Budget For You

If you’re planning a trip and have read this far, I’ve got something for you. I’ve made a handy realistic travel budget template to help you! 

Where do you find yourself going over budget? What categories hadn’t you considered or what additional tips do you have? If you’re curious, read my post about how I afford to travel. Let me know in the comments section!

GET THE FREE TRAVEL BUDGET TEMPLATE HERE

Till next time, 

Dee (Ms. Heels)