How to Plan A Travel Budget + Tips to Save Money on Independent Travel

When you’re getting ready to plan a trip, figuring out your travel budget is an essential first step! It’s easy to get carried away with big, over-the-top vacation ideas only to discover you’ve got to pare them down to make it work financially. If you start your travel planning knowing how much you have to spend, it makes the rest of the process a whole lot easier. Having a clear travel budget will help you prioritize the activities you enjoy most, visit the places you most want to see, and create a travel experience you’ll never forget!

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Determining Your Travel Budget

There are a few simple ways to come up with a travel budget for your next vacation. First, you can decide an average “amount per day” for spending. This should include what you’d like to spend for accommodations, food, activities, transportation, and shopping. Take the amount per day and multiply it by the total number of days you have for your trip. Then you’ll need to add on flight costs, travel insurance, any fees for entry documents, and a little for miscellaneous expenses. This will give you the total amount you have to spend on your trip. Some days you’ll spend more, others you’ll spend less. That’s fine, just keep track as you go along so you can know if you’re on track. 

Another way you can determine your travel budget is by setting an amount to save every month between now and your trip. Let’s say you decide to set aside $200 a month for your next vacation. Look at when you want to leave and multiply the amount by how many months until you go. There’s the travel budget you can use to start planning your trip! This might mean cutting back on extra expenses in your daily life now for the payoff of an amazing travel experience in the future. Honestly, I think about all my purchases in plane tickets. If I want a $50 pair of shoes, I have to ask myself if I care more about the shoes or the travel. The trip usually wins. It’s all about priorities, my friend!

In this post, we’re going to talk about the different elements you need to include when creating your travel budget. You’ll also learn how to figure out the amount you’ll need for each of these items. Save this post so you can come back to it and make sure you’ve covered all the bases. Let’s do this!

Deciding Priorities for Your Travel Budget

There are an endless number of ways to spend your money while on the road! With so much to see and do, it’s important to get clear on what matters most to you. Using the Value Travel approach, you’ll determine your priorities and allocate money from your travel budget to those things first. Then, you can use what’s left to fill in the gaps with other awesome experiences! 

First, decide what your absolute “must do” and “must have” items are for your trip. This can be anything from certain amenities at your accommodation, like air conditioning if you’ll be going to Greece in the middle of summer. It can also be visiting certain attractions or events in your destination, like tickets to the Edinburgh Military Tattoo or Fringe Festival if you’ll be visiting Scotland in August. Make a list of these non-negotiables so you can fill in those amounts first when it’s time to start researching.

Next, decide the elements of your trip where you can be flexible. Maybe you don’t care about being right in the middle of everything and are fine with using public transportation to get back and forth from where you’re staying. This will let you save money on your accommodation by picking a place further out from the main attractions. If you’re not a super foodie, going out for multiple dinners may not matter to you. Instead, you can pick up supplies at the local markets and have a lovely picnic in the park, which will save you a ton on your food expenses! Let’s have a look at the rest of the pieces you’ll spend money on while you’re traveling.

What Your Travel Budget Needs to Include

Look, I get it, one of the most intimidating parts of independent travel is figuring out how to put all these pieces together. Once you get an idea of what things cost in your destination and where you want to spend your travel budget, the whole thing gets easier. I promise!

Here’s the quick list of the different elements you need to plan for:

• Flights
• Accommodations
• Transportation 
• Food
• Sightseeing, Activities & Events
• Souvenirs & Shopping
• Travel Insurance & Health Care
• Visas & Documentation
• Miscellaneous Items

Flight Costs

For international travel, flights are usually the biggest chunk you’ll spend all at once, and the first thing you’ll want to book. There are a ton of different ways to save money though, so have no fear! Here are some tips for finding cheap flights to anywhere you want to go. 

When it comes to finding flights, there are a number of ways to configure your routes and timelines to get the best deals. You can use a combination of one-way flights, nearby airports, and multiple airlines to make it work. There are some serious considerations and trade-offs that come as you mix and match though. 

Accommodations & Lodging Costs

Accommodations tend to take up the next largest chunk of your travel budget. Again, there are a ton of different ways to save money, especially if you consider options outside of traditional hotels. Check out this post all about the different options and how to save money with them. Next do a quick search for accommodations in the area, filtering for any of your “must have” options. Booking.com is my go to because you can see all the different types and filter based on your budget. 

Your destination choice will have a massive impact on the average price of lodging. For example, what you pay for a tiny room in Oslo, Norway (it takes some work to find anything under $100 per night) is significantly more than you’ll pay for a whole apartment to yourself in Tirana, Albania (I paid about $25 per night). Keep this in mind when you’re choosing your destination. Location, amenities, and privacy are the other three factors that will most influence the cost of where you stay. 

Transportation Costs

How much of your travel budget goes to transportation is going to vary based on the part of the world you want to visit, how many stops you’ll make on your trip, and how you choose to get around in each of those places. There are three different transportation costs you need to make room for in your budget -- getting to and from the transportation hubs (airports + bus, train, or ferry stations), how you want to explore your destination, and moving from one stop to another, if you’re visiting more than one place.

Many major cities have great public transportation options for getting to and from the hubs, plus exploring the city itself. These are usually the most affordable and, many times, the most efficient options. In places with less infrastructure, you’ll have to get a cab to and from the airport, but these destinations are generally less expensive to visit in the first place. 

There are a lot of choices for getting from point-to-point, depending on where in the world you find yourself. You can choose from trains, buses, ferries, private cars, or flights. This is where you’ll find the biggest variance in cost as well. Do a little research to see what’s available, looking at travel time and cost. 

Food Costs

We all have to eat and one of my favorite ways to experience a destination is through food! There are a ton of ways to experience the local flavors that don’t cost much. Honestly, grocery shopping is super fun in a foreign country! Picking up supplies for a picnic in the park is a great way to see what the locals like to eat and you’ll rarely spend more than you would at home. If you enjoy cooking, find recipes from your destination online and try making them in your accommodation using the local ingredients.

Street food is another great option for eating well without breaking the bank. Street food is basically anything ready-to-eat that you buy from a vendor in a local market or public place. Seriously, I have so many amazing memories of street food from my travels! Some cities have a food hall dedicated to these types of vendors where you can try a bunch of different things in one place. You can also find street food stalls and shops in many of the main pedestrian spaces in most major cities. A full meal from a street food vendor is typically less than $10, sometimes as little as $2. A quick internet search for street food in your destination will give you ideas about what’s available and how much it will cost. 

Of course, a traditional restaurant is a wonderful way to explore local cuisine, though the most expensive option. Just like at home, there is a wide range of choices, from casual to fine dining. If you want to save some money, wander a few blocks outside the main tourist areas, which should get you better food and cheaper prices. Also, go to a restaurant for lunch. You’ll get to try the same dishes, but they’re usually smaller portions and less expensive than dinner. 

Sightseeing, Activities, and Events

This is the part of your travel budget that’s going to vary wildly depending on your travel style and interests. Understanding your unique travel style will help you narrow down the types of activities you want to spend your time and money on. Maybe you want to see every museum in your destination or perhaps you want to take a walking tour to get an overview of the highlights. You may be content to simply wander the streets, explore the parks, and sit in a café watching the world go by. If you’re like me and prefer to wing it, going with whatever sounds fun in the moment, give yourself a daily allowance for sightseeing and stick to it. 

Also, look to see local events are happening by checking the destination's tourism website. They usually have a list of what’s on throughout the year. Many events are free or you may be able to find discounts by making a stop in the tourist information office when you arrive. 

A great way to save money in many major cities is with the Go City passes. If you plan to visit very many of the major attractions, this can save you a ton! The pass gets you into a lot of the main sights and, sometimes, lets you skip the line since you don’t have to wait for tickets. I’ve used these in both London and Paris to save a bundle over what I would have spent paying for each one separately. 

Souvenirs & Shopping

This is another piece that’s going to vary based on your personal travel style and how much you want to bring home. At one point, I collected souvenirs regularly until most of them became dust collectors and started to take up a lot of space. That’s what happens when you make travel a part of your lifestyle! 

Now I opt for things I’ll actually use at home, like an item of clothing or a trinket that reminds me of a meaningful part of the trip. On my recent trip to Istanbul, the Whirling Dervish Sema Ceremony was one of the highlights. I found a little hand-painted ceramic dervish in the Grand Bazaar that now sits on my desk to remind me of that evening. That’s the only thing I brought home from the whole forty-day trip!

Planning these expenses into your travel budget will keep you from fretting about it when you find something you just can’t live without! You’ll know how much you have to spend and can do it without guilt. Whatever you’re into, I encourage you to choose items that are sure to bring a smile to your face when you see or use them. 🙂 

Travel Insurance & Health Care Costs

This is the less exciting part of planning your travel budget, but it’s important to make sure you’ve covered your bases, just in case. There are a lot of options for travel insurance out there, but I’ve found World Nomads to be the best for general travel insurance. If you’re looking for a plan that covers any Covid-19 related expenses, then this is a great list of choices. On my forty-day birthday trip through the Balkans, I went with one of these more robust policies, just for peace of mind. I did a few comparisons and picked one that hit the sweet spot between affordability and coverage. 

Do you have to have travel insurance? No you don’t. Most countries don’t require it, but it would suck to have any kind of major medical expense and be stuck paying out of pocket. Honestly, most of these are really affordable and the peace of mind is worth more than the cost. In the early days of travel, I never purchased travel insurance and was simply lucky to never need it. Now, I can see how things could have gone sideways on more than one occasion. It’s totally a personal decision, but know that there are some great, affordable options. 

With Covid-19 showing up in the world, there are now potential costs associated with getting testing and potential quarantine requirements. Make sure to look at what you need to enter your destination as well as getting home. In my experience, thus far, it’s been fairly easy to navigate. Even getting a PCR test in Istanbul for the flight back to the US was simple. The host at our accommodation arranged it and they came right to our apartment to do the test. It cost about $20, which is really cheap compared to what I’ve heard people paying in other locations. Just do your research and plan for it in your travel budget so you’re not stressing about it while you’re there.

Visas & Border Crossing Documentation

Always check for any necessary documentation you’ll need to enter your destination. Depending on where your passport is from, you may not need to do anything at all! What you’ll need and how much it costs will vary from place to place. Some will let you get your visa when you land and others require you to get it in advance so you can show it upon arrival. A quick internet search for your destinations entry requirements should get you all the info you need to plan for it in your travel budget. 

Miscellaneous Expenses

While you can plan out the absolute perfect trip, shit happens. Build a little cushion into your travel budget for any emergency spending. This could be unexpected airline fees, especially if you’re flying with one of the budget carriers (been there!). You may find yourself needing to change accommodations at the last minute (also been there). If you miss a train, you might need money to buy a new ticket (yep, that too). Though these events don’t happen very often, anything is possible. Having some funds at the ready can make an unpleasant event slightly less stressful. 

Tips for Maximizing Your Travel Budget

Now that you know all the different elements to make room for in your travel budget, here are some of my best tips for making those dollars stretch! 

Plan for the high end of the price range and see if you can come in under budget! This is a game I play when planning my trips and on the road. I’ll plan for the upper end of what I can afford for each piece and see if I can find what I want for less. It’s always a celebration when I find the perfect accommodation or flights for less than I’d planned to spend. Since I’ve already set my travel budget, It gives me more money left to spend on fun! 

Travel during  shoulder season or low season. Visiting a destination when everyone else is also visiting the same destination will always cost more. That’s just the nature of the beast. If you can be flexible with when you travel, go outside of the busiest times. 

Look for free activities. You’d be surprised at the amount of free and low-cost activities and events available. Atlas Obscura is great for finding off-the-beaten-path spots, many of which are sights with no entrance fee. Be sure to check with the tourist information office when you arrive to see what’s happening in the area and what discounts they have available.

Start your planning with flights! Flight prices vary widely from day to day and week to week. Start by looking for affordable flights and build around those. Here are some great tips for finding cheap flights. 

Look for accommodations outside the main tourist area, but close to public transportation. You can save a bundle that way! Here are some other tips for saving money on your accommodations. 

Compare your transportation options. The difference in travel time between a bus and a train might be minimal, but the prices can vary significantly!

Now you should be well-prepared to get that travel budget of yours put together! It might seem like a lot, but you don’t have to figure it out all at once. I promise, if you take the time to lay this out, it will make the rest of the travel planning process so much easier! 

Share Your Story

Do you usually plan a travel budget for your trips? Share what’s worked for you and what you’re excited to try next time! We’d love to hear your story in the comments!