UPDATED FEB 2020. When you start adding up the cost of a vacation, it can seem overwhelming and too expensive sometimes. The trick is really just knowing where to invest your money. Today I’m sharing a useful guide on how to plan a travel budget to sort through which expenses to splurge and skimp on. If you have any questions, just let me know.
How To Plan A Travel Budget – Where To Skimp & Where To Splurge
Disclaimer
There are affiliate links included in this post. This means at no extra cost to you, I earn a commission if you book through the link.
Splurge – Accommodation with good location
After having a terrible experience staying in a rickety hotel on the side of a highway in Texas, I now invest in a good hotel, in a convenient location.
A lot of times I find it a better investment to pay extra for a good location instead of transport going in and out of the city.
Taxis or Ubers add up quickly, plus then I can do quick trips on foot whenever I feel like it and don’t need to wait around for transport.
I use Booking.com to find accommodation when I travel because I can always find a good deal there. It’s a good idea to join their Genius loyalty account too because I use this and can usually save an extra 10-15%.
After I’ve checked the reviews, I look at where it is on Google Maps to see how far it is to walk to the main sights or if there are public transport stations within walking distance.
Skimp – Transportation
This aligns with splurging on accommodation with a good location because with that you can skimp on transportation costs to get in and out of the city.
Either way though, you can skimp on transportation costs by walking as much as possible.
My personal rule as long as I have the time is if the walk is an hour or under, I walk it.
I also use Google Maps in offline mode so that I can always find my way around easily. Here is a tutorial on how to use that. Another option is the Maps.me app.
You can also rent bicycles or scooters in a lot of big cities, and choose public transport over taxis.
Splurge – A good camera
Whether it’s a good phone camera or a separate good quality camera, I think they are well worth the investment to be able to take photos on vacation.
And, let’s face it, you’re going to get those post-holiday blues and want to look back on your adventures – that’s also where a good travel journal
comes in handy.
Both the camera and the journal will be your time machine to transport you back to your adventures when you want to re-live them.
There are three cameras I use regularly for traveling.
- Sony Alpha a6000
– The best camera for travel because it is powerful enough to take high-quality photos yet compact so it doesn’t attract a lot of attention. - GoPro – Always with me for selfies and videos.
- Compact selfie stick and tripod – This is the selfie stick I use with the GoPro. I love that it’s small enough to fit in jacket pockets.
- Sony RX100 – This is probably what I use the least, but it is a good option if you want nice photos and the ability to use manual mode, but not necessarily interested in advancing your photography skills and trying different lenses, etc.
– The best camera for travel because it is powerful enough to take high-quality photos yet compact so it doesn’t attract a lot of attention.
– This is the selfie stick I use with the GoPro. I love that it’s small enough to fit in jacket pockets.
– This is probably what I use the least, but it is a good option if you want nice photos and the ability to use manual mode, but not necessarily interested in advancing your photography skills and trying different lenses, etc.Skimp – New clothes
As long as you have the weather appropriate staples like layering options and good walking shoes, you don’t need a full new wardrobe for your holiday.
You can totally resist the urge to overconsume here.
Skimp on this expense and use clothes that you already have.
If you look at my photos, I’m proof of this because I’m always wearing the same stuff over and over. Most of my clothes are many years old.
I only buy clothes when I need them to replace other clothes so I have a small wardrobe, but it helps me spend more on traveling instead.
Splurge – Experiences
This is the second most important to accommodation in my eyes because this is what your travel is all about – the experience.
Whether it’s taking a class, a day tour, activity or tourist attraction, this is a space that is totally ok to splurge. Otherwise, what’s the point of traveling?
The experiences are everything and can add so much depth to your vacation by meeting local people, learning more about the area and/or creating fun memories that are different from your everyday life.
I also think it’s important when you travel to support the local tourism industry so that you’re not a traveling vampire just taking and not giving back.
Skimp – Food
Especially airport food!
I used to spend a lot on food by doing things like always going to nice restaurants each night and cafes for breakfast. I learned the hard way how quickly that all adds up.
Now I have learned to skimp on those.
My strategy is usually to eat breakfast at the hotel if it is included and I use this as my biggest meal of the day.
In the afternoon I get a small snack and drink while I’m out, then for dinner, I go out for a meal which is usually not too expensive.
I like to try foods local to the area, street food, and local restaurants as opposed to big, fancy ones.
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Splurge – Insurance
If you can’t afford insurance, you can’t afford to travel. End of story.
Maybe you’re ok with losing money if your flights got canceled or bags got lost. But, there’s no room for overlooking medical expenses in case of emergencies.
And no, you cannot rely on a GoFundMe if you do come across an emergency situation. They’re not a replacement for being responsible.
Hopefully, you will never need to use your travel insurance but it’s much better to be safe than sorry. It’s worth splurging on the insurance that will cover you if the worst-case scenario happens.
Skimp – Excessive souvenirs
All of those little impulsive purchases will add up over the trip.
They’ll also cut into your baggage allowance as your luggage starts filling up.
What I do is pick up a shot glass from each place I visit. Shot glasses are easy to get everywhere and don’t take up much room or weight.
Sometimes I also get something practical or useful for the house or a piece of clothing.
I avoid extra stuff that just sits around the house like the plague – if it doesn’t have a use, I don’t get it.
Avoid excessive shopping sprees by pausing before buying and asking yourself if you really need the item and how will you use it.
Want to organize your travel budget? FREE budget planning printable!
If you need a little help getting your budget ready, click here to download the FREE budget planner I made.
It will help you plan your expenses with a breakdown of your savings goal per month to get you there.
You can estimate the costs at first to give you a ballpark direction of what you’re working towards.
Other guides to help you plan your travels
Long Haul Flight Checklist – How To Survive Long Travel Days
Travel Photography Tips For Beginners – Improve Your Shots In 6 Easy Steps
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