How to Plan a Travel Budget: 9 Tips to Save Money and Have Fun

We love budgets!

And we also know that most people don't.

But don't worry, you don't need to break the bank to have a memorable trip. With a bit of planning and the right attitude, it's possible to have a fantastic travel experience without overspending. In this article, we will provide you with some tips and tricks on how to travel on a budget and make the most of your adventures. 

1. Decide your travel goals for the year

The first step in creating a travel budget is to decide your travel goals for the year. Determine the type of traveler you are and what you would like to achieve. Would you prefer to go on daily or weekend trips in your local area, a 1-week vacation to a different country or continent, a backpacking trip through western Europe, or a luxury vacation in Norway, New York City, or Sydney? All the following steps will depend on your goals and the type of traveler you are. 

Our plan for 2022 was: a 2-3 week-road trip across Greece, 10-12 days at Sao Miguel (Azores, Portugal), and 1 week in Albania. Together 31-40 days. 

2. Allocate your yearly travel budget

 When it comes to allocating your yearly travel budget, it’s essential to determine your personal finances. If you have a mortgage, rent, or any debts, you’ll need to consider that when allocating your travel budget. 

If we were in debt, we think we would go only on necessary travels, like visiting each other regularly (as we are still in a long-distance relationship) or for events that our friends or family organized abroad.

If you're lucky enough to have financial security, then you can allocate a higher percentage of your income to travel. 

Remember that travel doesn't always go as planned, so allocate only such a percentage that you will not regret it no matter how your trip or vacation goes. 

In the end, you might spend more or less, but it’s essential to allocate a budget and stick to it as much as possible. 

Our plan for 2022: All our plans should fit within 5,000 EUR/USD for 2 people or 125 EUR/USD (62.5 per person per day if we spend 40 days abroad).

In the end, we spent 4,559.59 EUR/USD but only spent 33 days abroad (69 EUR/USD per person per day).

For example, in Greece, we spent 58 EUR per person daily. According to recommended budgets on nomadicmatt.com, we fall into the Backpacker category, which means sleeping in dorms, eating cheap fast food, and using buses. We have to say that budget of 58 EUR per day let us stay in 3 to 4-star-hotels close to beaches, eat every meal in a restaurant (we did not cook even once), did not limit ourselves when it comes to comfort, food, and a ton of ice-cream, and include souvenirs and all amenities we bought on the road, such as sunscreen. We even had to pay 50 EUR to get our car fixed. To summarize, we accomplished the experience of "The Middle-of-the-Road Traveler" with "The Backpacker" budget, even with problems with our car and driving 2000 km in total (1243 miles).

3. Divide your budget between your travel goals.

After allocating your yearly travel budget, it’s time to divide it between your travel goals. Consider the time you plan to spend in each country, the costs of each country, and the experiences you want to get from those countries or trips. Based on that, divide your yearly budget into all your planned travels. 

Our plan for 2022: Based on our research before the travels, our budget for 2 people was:

• 10-12 days in the Azores was 2,000 EUR,
• 2-3 weeks in Greece 2,300 EUR,
• 1 week in Albania 700 EUR.

4. Find the budget template or an app that fits you and is easy to track.

To track your budget easily, you should use a budget template or app that fits your travel style. Some of the best websites for planning and tracking your budget are Mint, Google Sheets, and Excel. These tools will help you to plan your travel budget and track your expenses easily. 

5. Plan the most significant expenses and start booking

Our top 4 categories that typically cost us 85-93% of our budget are:

• Accommodation
• Food (groceries/ dining out)
• Transport (car rental, fuel, taxi, public transport)
• Flights

The division between these depends on many factors. Start by researching the average prices for the categories above.

What we did: In Greece, we didn't have to rent a car or get flight tickets, as we drove from Bulgaria in our own car with efficient fuel. Thanks to that we spent only 9% of Greece's budget on all transport. Because we planned to drive a lot, we spent almost half of the budget on accommodation, as we wanted to prioritize comfort and quality sleep. 27% of the budget was spent on food. And we did not regret even one cent spent on delicious and healthy Greek food.

In Albania and Azores, where we both had to fly and rent a car, we spent 40% of our budget on flight tickets and transport. We spent 25% of the budget on food and 28% on accommodation. In Albania, 30% was spent on food and 18% on accommodation (we shared the accommodation with 2 more friends).

6. Tweak your budget if it doesn't fit

No matter how much you plan, things can still go wrong or unexpected opportunities may arise. Be prepared to adjust your budget and plans as necessary. For example, if you find a great deal on a flight to a different destination than your original plan, be open to changing your itinerary. Or if you experience unforeseen expenses, such as a medical emergency, be ready to adjust your budget to accommodate those costs (Couchsurfing, finding a room on Airbnb instead of a whole place, or finding a hostel bed). 

It is up to you if you tweak accommodation costs or decide to cook some meals yourself instead of going to restaurants. Your priorities depend on you.

Tip: Do not spend too much time trying to cost the smaller costs, such as souvenirs or experiences. It's much easier to reduce accommodation or food costs than 10 EUR in some other category. In the end, you might not even remember where you slept, but you will remember what you experienced and what memories you will bring home with you.

7.  Look for ways to save money 

 There are many ways to save money while traveling, such as staying in hostels, using public transportation, cooking your own meals, or traveling during off-peak season. Do some research before your trip to find ways to save money on your travels. You may be surprised by how much you can save without sacrificing the quality of your experience. 

8.  Keep track of your spending 

Why do we write down every cost? To know our behaviors better and make the next budget even more reliable. For example, if you realize that you are buying ice cream twice daily, you might create an ice cream category for your next vacation (or consider cutting it down to once per day, which will be healthier for you and your wallet). 

For instance, we thought we would cook on our vacations and planned that for the first time. Soon enough, we realized we wanted to explore the local cuisine, get inspired by local tastes, and use our time more efficiently. In the end, while you are waiting for your meal in the restaurant, you can plan for the next day, update your travel diary and budget, or just relax and recharge your energy).

The crucial thing here is to make the system so easy that you don't have to think twice about it. Then, make it into a game and create a reward system.

Tip: The obvious app that helped us was Revolut. The benefits are extraordinary and with no fees. Not only will you get free ATM withdrawals anywhere in the world (limited to 200 EUR monthly with the free account), the best conversion rates, and the option to exchange between 29 currencies anytime (try to do it on the weekdays to have no fee and the best conversion rate).

We hope that you are already using it, and if not, we are adding our referral link that can give you starting bonus depending on the current campaign https://revolut.com/referral/adrinaneuu!SEP1-22-AR

9. Review and repeat.

Celebrate if you stay within the budget.

Celebrate even if you went above. It's your first budget, after all.

There was probably something on your travel that was so worth it that you decided to go above the budget.

With a little planning and preparation, you can easily create a travel budget that works for you! By following these tips, you'll be able to save money and still have an amazing vacation.

Have a great trip! 

-Yada team :) 

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