How to stick to your travel budget - MoneySense

How to stick to your travel budget

“Admission costs can break you”

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You’ve done all your research, found a cheap flight, and managed to save on your hotels, but now that you’re on the ground, sticking to your travel budget seems difficult. Listen, I don’t blame you. When travelling, I get the urge to spend more, but the last thing I want is to return home to bigger bills than expected.

Your travel budget is no different from your budget at home. It makes sense to have one big travel budget, but then you need to break down your individual expenses when you’re abroad. With these tips, sticking to your travel budget will be easy, and you won’t even need to track every dollar (or whatever the local currency is where you’re at).

Make sure you know the exchange rate

I was recently looking at hotels in New York City where I was finding rooms for about $250 US a night. That’s not terrible, but then I had to factor in the 15% hotel tax and the 30% exchange due to the weak Canadian dollar. That room ended up being $362.50 Canadian a night which wasn’t a deal at all.

You won’t be taxed extra on everything, but it’s critical to know what the exchange rates are so you know exactly what you’re paying in Canadian dollars. £5 for a sandwich is a standard price in England, but in Canadian dollars, that’s $8.60! Alternatively, 100 Thai Bhat may sound like a lot, but that’s less than $4 Canadian.

Create a daily budget

As mentioned, you need to account for individual expenses when travelling. After flights and hotels, food will most likely be your biggest expense. You can’t just come up with a random number, figure out what the food costs locally. If you like to eat out, budget more. In my previous post, how to eat cheap when travelling, I share more tips on how to save.

Usually, I don’t think it’s necessary to track every dollar, but if you find you’re going over budget, just start writing everything down, so you know how much you’ve spent each day. You could also use cash only (carry only your daily amount) which should help control some of your spending. Some days you’ll spend more, but others you’ll spend less so it all balances out. I don’t recommend being cheap when travelling, but you also shouldn’t go all out.

Look at how you like to travel

In the past, I would try to hit as many destinations in possible. I would aim to hit a new spot every 3 days so in a 2-week span; that would be 5 places. It didn’t take long to realize that it was tiring and expensive to keep moving around. Transportation tends to be an overlooked cost when travelling all those trips to the airport will cost you money.

Don’t get me wrong; sometimes it’s very affordable to go to another destination especially in Europe and Asia, but it’s still an additional cost that you need to factor in. Take your time at locations, explore like a local, and use public transportation to keep costs down.

Admission costs can break you

When I first started travelling, I used to have a checklist of attractions that I insisted on seeing. I would run around to each site just to say I had seen it. Well, the admission costs started to add up, and I wasn’t enjoying myself since I was rushing everything

These days, I tend to pick just one must see attraction and then have a loose schedule for the rest of the day. This is possible because I travel slower now, so there’s never really a set schedule. If you’re the type who likes to visit a lot of attractions, make sure you check to see if the city offers some kind of attraction pass that will help you save. Make sure you do the math to see if the passes are actually worth it based on what you plan on seeing.

Avoid buying junk

I’m not talking about fridge magnets here. I’m talking about those items that look great when you’re travelling, but have no place in your home. When I was in Istanbul, Turkish lamps were sold everywhere and looked amazing, but in my home, it would just look tacky. How about souvenir T-Shirts? Some people buy them as a gag, but I don’t get why anyone would want a Hard Rock Cafe shirt from wherever they visited.

You also need to think about quality. Local markets can be great for finding nice local specialties e.g. leather in Italy, but I wouldn’t recommend buying things just because they’re super cheap. In Bangkok, I bought belts for $2 each, after two uses they started to fall apart. Don’t even think about buying “fake” products such as electronics or clothes. The quality is usually crap so you’ll just end up spending more money later replacing them.

Sticking to your travel budget is ideal, but travelling is a life experience and you should never cheap out on it. The tips I’ve provided are meant to help you keep your budget in check, but it’s totally okay to splurge sometimes. Always budget and don’t hesitate when an experience is available.

Barry Choi is a personal finance and budget travel expert at Moneywehave.com.  He has been quoted in The Financial Post, The Toronto Star, Business Insider and The Globe and Mail. You can follow him on Twitter:@barrychoi

This article originally appeared on Moneywehave.com


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