If you have a set budget for a trip, it’s important to know not just what your overall amount is to spend, but how and where your money will be going for each part of your trip.
It’s all too easy to focus on one part of the expenses (ie the flight to your destination), and end up going over budget on the many other small things that add up day to day.
If you’re on a super tight budget, it can be frustrating to have so many things you want to do or see in a country, but only enough money to get there, not to enjoy yourself fully.
It is absolutely possible, however, to travel on any budget. There are many, many strategies to reduce the cost of every aspect of travel. Whether it’s virtually free flights to get there or having your food and lodging provided, it all comes down to knowing what your budget is in time and money, your priorities, and working in a little creativity and flexibility.
1. Be Honest With Yourself
This is a basic budgeting technique, no matter what you’re budgeting for: make sure you’re being 100% honest with yourself about what you can and cannot afford.
It’s tempting to go all out if you don’t get many trips or vacations (haha or even if you do!), but overspending on one trip means it will be more difficult to take another in the near future, and will add undue stress either on the trip itself or when you return. It’s just not worth it.
I’ll repeat myself: you can travel and have a great time no matter what your budget is.
So, check your finances, come up with an honest, accurate number, then add about a $200-$500 buffer.
2. Choose Your Destination Wisely
The expenses of where you go can vary so widely – both in terms of the cost of flights and in country prices – that the simple choice of which country to go to (or city or state) drastically affects how far your money will take you.
It’s possible to travel anywhere on a budget. I went to both Iceland and New Zealand (ie two of the most expensive countries in the world!) when I was the brokest I’ve pretty much ever been, and had an amazing time. But it took a fair amount of planning, and definitely a few compromises (ie eating a lot of rice and beans 😉 ).
Certain parts of the world are great travel destinations in that they are beautiful, safe, welcoming to travelers, and have rich cultural and/or natural experiences to offer, while being incredibly affordable when you convert your dollars. The main areas for these are Southeast Asia (Thailand, Vietnam, Cambodia, Indonesia, Philippines), Eastern Europe (Romania, Bulgaria, Hungary, the Balkans, Croatia) and South America (Bolivia, Ecuador, Colombia, Peru).
If you’re really budget conscious, and open to places a little off the beaten path, any of these regions/countries are a good place to consider.
If you’re really set on going to England or Australia, or any other place that is notoriously expensive, it’s very doable. But be prepared to make some compromises in trip length (maybe not in the way you think!), activities you’ll do, or what you’ll eat.
3. Break It Down Per Day
Once you have your budget and destination, figure out what the average cost is to travel in the country per day. This can be done by Googling, checking travel guides, or asking on travel forums.
Of course the average cost is dependant on your style of travel- do you stay in hotels or hostels? Do you eat out for every meal, or cook some yourself?
Find a group forum or influencer who travels the way you do, and use their numbers to get a baseline. Then, take your overall budget (minus your buffer and flight cost) and divide it by the daily cost.
Scenario #1:
I have $3,000 saved to go to Thailand.
My trip buffer is $300. I found cheap tickets from San Francisco to Bangkok on SkyScanner for $428.
According to Nomadic Matt’s travel guide, it costs about $25-$30/day if I eat cheaper street food and stay in hostels (my preferred way to travel). To build in another small buffer I will use $35/day.
So $3,000 (my budget) – $300 (my buffer) – $428 (my plane ticket) = $2,272
$2,272/$35 (cost/day) = 64.91 days
This means that with just the basics covered (flight, food, and lodging), I can spend 64 days in country and stay within budget. (Awesome!)
Let’s say I also want to get my scuba certification and go on a few jungle treks while I’m there. Again, using the approximate costs shared by other travelers, I know that will cost me about 12,400 Thai baht, or just under $400.
So if I recalculate with this addition:
$3,000 (my budget) – $300 (my buffer) – $428 (my plane ticket) – $400 (activity expenses) = $1,872
$1,872/$35 (cost/day) = 53.4 days
Then I can do my big funsy activities AND stay in the country for 53 days.
If I want to or can only stay in the country a shorter time, obviously that gives me more options to upgrade my food, lodging, do more activities, or put the extra cash towards another trip. (What a great problem to have!)
4. Stick to It
To really stick to your budget and daily estimates when you’re actually in country, you need to arrive knowing the cost of food, lodging, and transportation in the local currency that fits the budget you’ve calculated.
$35 a day = 1,122 Thai baht (THB) using XE currency exchange.
Checking Hostelbookers, a bed in a hostel dorm room with good ratings in Chiang Mai costs about 400 THB ($12).
Using costs shared by other travelers, I know it’ll cost about 50 THB per meal ($1.55).
And 35 THB ($1) if I buy beer at the 7 Eleven.
And a motorbike taxi ride around the city will be about 35 THB ($1).
With these numbers, I can see it won’t be difficult to stay within my $35/day budget when I’m staying just in the city and doing basic sightseeing. Additional costs to get between cities, entrance fees for museums, etc. will probably give me days when I go over $35, but so long as all the travel days average out to 35, we’re good.
It’s important to know what prices to look for in the local currency for three reasons:
- In Thailand, as with many places, haggling over prices is the norm. Which means that if you don’t walk into negotiations knowing what’s somewhat reasonable, you will likely (ie always) end up paying a lot more than you should.
- Even if you’re not dealing with bartering, choosing from establishments with set prices while knowing what “normal” prices are will help you understand when places are really selling quality, versus a tourist experience. If a hostel or guesthouse wants 800 THB for their room instead of 400, then there should be something in the quality of location, a beautiful building, free breakfast, etc. to show me that extra value. But I won’t know to look for that value if I don’t know the baseline.
- Trying to convert between the local currency and your own in the moment is difficult unless you’re a complete math whiz. Knowing that you don’t want to spend more than $15 on lodging isn’t helpful when everything is posted in baht; carrying a small calculator when bartering to do quick conversions can be incredibly helpful (sounds nerdy, but it’s weirdly reassuring, and way better than flashing your smartphone when haggling), but is cumbersome. The sooner you can understand the worth of the local currency and think in terms of it, the better off you and your budget will be.
5. Yes, but what if my budget isn’t working?
In this situation, I had a good amount of money saved up, found a super cheap flight, and wanted to go to a very budget friendly location.
What if none of those things were true?
Scenario #2
I have $2,000 saved up to go to Iceland.
My trip buffer is $400. Tickets from Denver to Reykjavik on SkyScanner are $562.
According to Nomadic Matt’s travel guide, it costs about $75/day if I eat cheaper food or cook for myself and stay in hostels. I’ll use $80/day to build in another small buffer.
So $2,000 (my budget) – $400 (my buffer) – $562 (my plane ticket) = $1,038
$1,038/$80 (cost/day) = 12.97 days
This gives me just 12 days in the country with no activity or alcohol budget (a significant thing to budget in Scandinavia!) and very little wiggle room. Possible, but not ideal.
The biggest travel expenses are plane ticket > lodging > food > in country transport, unless you are looking to do some significant tours, certifications (ie scuba diving), or other extra special experiences.
There are a ton of options to minimize costs in each of these areas.
Save on Airfare
- Flexible travel dates
- Flexible start/end locations
- Use airline points/flight hacking
Save on Lodging
- Housesitting
- Volunteering
- Workstay (WWOOF, Workaway)
- Couchsurfing
- Utilize your personal network (ie stay with your uncle’s second cousin)
Save on Food
- Cook all your own food
- Use cheaper ingredients (ie rice and beans diet)
- Transition to 2 meals a day
- Workstay (generally food + lodging provided)
Save on Local Transport
- Use the cheapest option (bus vs train vs taxi vs motorbike etc.)
- Buy local network passes
- Share rides (BlaBlaCar, rideshare boards)
- Budget rentals (Turo, SAD Car, Daytrip)
- Relocate car rentals
- Hitchhike
Conclusion
This is where the compromising comes into play. If you don’t have time flexibility, a lot of the biggest money saving strategies are not a great option (flying on the cheapest dates, doing a workstay or housesitting as these require longer commitments and/or flexible dates).
If you have plenty of time but not enough money, then actively organizing worktrades, being flexible about where you sleep (never turn down a couch), and putting the work into getting the deals that flight hacking offers should be able to get you there.
Ultimately it comes down to knowing what your top priorities are for the trip (exploration, relaxation, a specific site or experience) and organizing the other variables around that to make it doable, no matter what your budget.