Travel budget

I wish my trips were just about relaxing, sightseeing, adventure, and nice beaches. Unfortunately, most of my trips included some paperwork. Planning budget for a trip is on top of the list of “office jobs” you have to do for almost every trip. The less money you have, the better budget you will have to make. The longer your trip is, the more work on budgeting you will have to do.

If you make good travel budget, you can see as much as you can for the amount of money you have for a trip, on a level of comfort that you are comfortable with regarding transportation, accommodation, and eating. It has to be accurate, so you don’t spend more money than you planned or miss something because you thought you don’t have enough money for every attraction you wanted to visit. Some people make very rough travel budgets. They pay for a transportation between home and destination, and rest of the money divide with the total number of days of a trip. This is very inaccurate budgeting, because there is a lot of expenses, and it is very hard to make a perfect combination between sightseeing, accommodation, eating, and transportation with such a rough plans.

On the other hand, your travel budget don’t have to be perfect either. It is important to identify biggest expenses, and the smaller one you can group and estimate. It is not too difficult to make 90-95% accurate budget for a trip. However, if you aim for a 100% accuracy (which is almost impossible) you will need much more time for researching and planning. The last 5% are not worth a time you will have to spend to reach it.

Before you make your budget for a trip, you will have to make detail trip itinerary. This is the only way you can be sure you will cover all expenses.

Pre-trip expenses
Visas and exit fees

Before you go abroad always check do you need visas, how can you obtain them, and how much they cost. When you leave some countries, like the one in Central America, you will have to pay exit fee too.

Travel insurance
This is optional, but you should always travel with travel insurance. It doesn’t cost much, but it can save your nerves and money. Medical expenses for foreigners in almost every country are very high.

Immunization
It is a good idea to check do you need immunization when traveling in areas like Africa, South America, or India. Talk with infectious disease specialist in your local hospital, find information on the internet, but don’t panic. If you take for granted every information about immunization on the internet, you would probably visit the nearby city full of vaccine stings.

Equipment
Quality travel equipment can make a difference between great and bad trip. You need travel gear that will not let you don’t when you are away from your home, maybe in the middle of nowhere, especially if you are backpacking. You should not consider equipment as a trip, but as a trips expense, because you should buy gear that will last for years and more than one trip. So this is optional cost.

Trip expenses
Transportation
Travel moneyBesides, transportation costs between your home and destination, you also have to plan how much money you will spend on transportation between cities and places while you are on the trip. Airports are usually out of city centers, so transportation costs to/from airports and train stations can be significant, and thus have to be included in you budget plans. Transportation within cities usually are not high, so you don’t have to plan them in detail. They can be included in daily expenses that I will explain latter.

Accommodation
You can either book your accommodation in advance so you would know exactly how much money you will spend, or you can do research and make a rough plan for your accommodation expenses.

Attractions, sightseeing, and tours
Most of the people include sightseeing in daily expenses, but this is mainly because they don’t make detail, day by day travel itineraries. I would definitely recommend making detail travel itineraries. One of the main reason is because it can help you to estimate very well how much money you will spend for museums, historical sights, national parks, tours, activities, etc.  Also, some guided tours you might take include transportation, accommodation, and meals which affect you budget plans for these items.

Daily expenses
Daily expenses include food, drinks, night outs, and transportation within the city. You will have to do research and to estimate how much money you will spend daily, according to your preferences and life expenses of the places you are visiting.

Souvenirs, gifts, shopping
Even if you are not keen on shopping, it is likely you will spend some money on one or two interesting things you may see. If you are a shopaholic, then you should definitely plan your shopping budget.

Bank commission
Banks takes a commission for using credit cards abroad (withdrawing money from ATM, paying, booking), so you should know roughly how much using credit cards will cost you.

Track your trip expenses

Plans always sounds good in theory, but what they mean in a real life? Well, in real life things can change. It is very easy to lose sense of how much money you spend, especially when you are on holiday. Saving money is not on your to-do list in days of leisure. You would probably spend more money than you thought you would. So, if you are on tight budget and/or your trip is long, tracking your expenses is a must.

How can you track trip expenses? You should note your daily expenses in a little notebook, day by day. This may sound like a painstaking job, but you will need no more than 10 minutes daily for this. This is important because otherwise it would be very difficult to know if you are spending money for daily expenses as planned.

Periodically, on every 7 or 10 days, you should check how your budget plan is performing. You can do this by comparing how much money you planned to spend with how much money you really spend. Check how much money you planned to spend for transportation, accommodation, sightseeing, and daily expenses in total for given period of time. From the amount of money you have, subtract the money you had at last check, so you will see how much money you spend during that period. When you compare these two values, you will know if you are spending money as planned.

You should always take more money than you planned to spend, because during your trip something unpredictable can happen that may increase your expenses (missed or canceled flight, lost luggage, road block). Also, you can’t be sure if your budget is good enough or not.

Think about making the budget for a trip as something that can help you to plan your trip better in general. In a process of budgeting for a trip, you will learn something new about places you visiting and this will be great side value. It is always good to know how much money you spend, and trips are no exception. On the other hand, you should not be overwhelmed about how much money you spend on your holidays. Don’t spend too much time for planning and tracking your trip budget, because this should not be a point of any trip. If you are on really tide budget, and if you are going to think more about finance than about the places you visiting, you should consider visiting a cheaper destination or making you trip shorter. It is much better to spend 10 relaxed days than 14 days with notebook and calculator in your hands.