If you’re a part of the population that is confined to your home and doing your best to stay entertained, trying to avoid ordering another unneccessary item online and wondering when your next vacation will be — this post is for you.
If you’re currently unemployed or worrying about this month’s bills, please do not feel like budgeting for travel should be a priority right now. While I hope everyone gets the opportunity to take a well-earned vacation once this is over, I realize that travel is most definitely a privilege. That being said, I want to share my budgeting and saving process with you in hopes that it makes a difference and allows you to take a trip that might have not been possible otherwise!
Here are my 4 tips to budget and save for travel.
Map out Costs
If you were working to save for a new computer, the first thing you would do is research the cost of said computer. The same goes for travel. My first tip is to operate in specifics and map out potential costs for the trip that you want to take.
To map out costs, start with the most expensive element. I personally budget and plan my trip in this order:
- Flights
If you have a destination in mind, but not a timeframe — then I suggest downloading the Hopper app and doing a bit of research about the expected flight costs, which are dependent on the time of year and how far out you’re booking. If you value saving money over driving a few hours out of your way, be sure to add nearby airports to see how flight prices compare. Hopper also gives you a good idea of how far in advance you should be booking your flight. If you have a specific season in mind for your trip, then I use Google Flights to play around with departure and arrival dates and look for the average cost. Also, if you’d like to go to multiple cities or countries on your trip, don’t be afraid to use the “multi-city” feature and see how costs compare to fly into one place and out of another!
I personally use a credit card with travel rewards to book my flights and do not believe in carrying a credit card balance and paying interest in the name of travel. So, let’s say in my Hopper research I see that flights to Rome seem to sit around $1,000 per person round trip. While $2,000 just for 2 people’s flights may be daunting — knowledge is power and it’s time to start saving my friend. But let’s not stop there, let’s get the full picture before we tackle just how you’re going to budget for this.
- Accommodations
Researching accommodation costs depends entirely on your personal preferences. If you have a champagne taste, then start browsing 4-star hotel costs on Booking.com or Hotels.com, the site doesn’t matter as much since we’re simply trying to get a feel for what calls to us and the cost per night. If you’re looking to go on a week-long trip and you’re favoriting every hotel or Airbnb that’s in the $150-200/night range, then $200 x 6 nights = $1,200 would be our guiding range. I’ll get into how to know when it’s safe to splurge near the end!
- Transfer
I consider “transfer” to be car rentals, trains, busses, or even smaller flights if you’re going to multiple cities or countries on your trip. If you know a car rental is in your future, that’s one thing — but if you’re not even sure of the best way to get from A to B, then I highly recommend looking into Rome2Rio, it’s a fantastic website and app that helps you “Discover how to get anywhere by plane, train, bus, ferry & car” with a price range attached to each route. Take note of what you could expect to pay when it’s actually time to book.
- Activities
The cost of tours and activities can range greatly with each vendor, and can be a hefty total, especially if you’re planning a trip for your family or a large group. I suggest taking to TripAdvisor to look through the most popular activities for your destination and skim reviews to ensure you feel the value is fair. I’ve taken a tour or two in my lifetime where upon arrival, I realized I most definitely could have gotten myself there and would have enjoyed it more had I not been rushed or herded with a tour group…
If your trip is 7 days, look for 3-4 major activities that you would consider musts and total the costs for your party. While you might think you need to have a full itinerary for each day, in my opinion, there is nothing worse than an over-planned trip that leaves no room for relaxing OR to do the activities that present themselves upon arrival. This deserves to be its own blog post, but keep in mind that there are great local vendors and tour guides that don’t have the marketing dollars to be at the top of Google. Be sure to ask locals upon arrival, “what should I do while I’m here?” And listen to what they have to say!
- Daily Spend
Simply Google, “daily spend in…” and do a bit of scrolling. Here, you’ll see average costs for meals in a day, alcohol, attractions, etc. This is a category that I don’t typically save money for, but it is nice to do this quick equation ahead of time so that I don’t experience sticker-shock and it does give me an opportunity to save if a destination is more expensive than my own day to day life (Iceland)!
Tools to Save
Once I’ve researched each category and have an estimate for each that I feel comfortable with, I plug them into my Google Sheet. This isn’t anything fancy, I have just done this enough to know that looking it up and “telling yourself to remember that dollar amount” will not work and will just leave you doing the same research a week later.
If your goal is to save for your flights, accommodations, and a few tours/activities before leaving for the trip — then add this up and go download the app Digit [or any tool that allows you to make specific savings goals]. I have used Digit for years because I like that it analyzes my spending and subtracts amounts here and there that I’m unlikely to notice. I am also able to set minimums so that it will absolutely not pull money from my bank account if it falls below X. You can add a new goal, name it something cute, and add a dollar amount and optional date to save by. This is one tactic I use, but let’s move onto the next.
Pinpoint “Fun” or Excess Spending
As much as we’d like this goal amount to just appear in our bank account, something has to give in order to get us there. If you have a shared bank account, don’t just start handing out orders or moving money around — get your partner on board. This will go so much faster and be SO much more enjoyable if you’re in it together. The first things I personally look at when trying to replenish my travel savings are:
- Target trips
- Coffeeshops
- Bars
- Sephora hauls
- How many times are we eating out a week!?
- Subscriptions [Cancel that Fabletics subscription that I ALWAYS forget to skip]
You get the gist. I find that without a specific goal amount, my default is to occasionally look at my bank account, see that I’m doing okay, and then move on without really analyzing my spending. It’s something that most of us, unless you’re the finance type, tend to avoid. But now is the time to get real and review your spending over the past 3 months. Highlight what fits into your defined “fun” category [you get to define this, but remember if you’re not strict, that vacation will only have to wait longer], and total for each month. Now, let’s say that you spend an average of $600 per month on your “fun” categories and you get paid twice a month. Of this $600, choose an amount that you can live with and when your paycheck hits, pay your bills and immediately move 1/2 that into your savings. So, if you wanted to go on that trip ASAP — you would move $300 into your savings with each paycheck.
It’s much harder to justify a trip to Target when you don’t have the money to spend. Please do not self-sabotage and go get a Target credit card. Picture yourself drinking a nice red in an Italian vineyard instead!
Set Benchmarks
With the predictable amount you set aside each month, you’re able to estimate roughly how long it will take to save for the first purchase of your trip — the flights. Using the $2,000 total to Rome, you’re looking at roughly 3.5 months. Depending on your accommodation costs, you’re then able to estimate just how much time you need in order to pay for your accommodation in full.
Keep in mind that most hotels allow you to book in advance and pay upon arrival, but may offer a discount if you can put a deposit down. Whereas, AirBnb presents the option to pay in full upon booking OR you can pay half upfront and half at a later date. The route you take depends on your comfort level when it comes to putting money on your credit card vs. having more time to save the full amount and pay upon arrival.
I suggest treating anything saved through Digit to be a bonus, which then justifies a hotel upgrade or perhaps a treat yo’ self-style day on vacation, the choice is yours. When I’m not “aggressively” saving for a trip (now is a good example considering we have no idea when we will be able to travel), I still utilize Digit as a form of passive saving. This approach can honestly be used for anything, not just travel. If 2021 is your year to travel, then I suggest implementing these tips to budget and save for travel ASAP so that when the time comes, you’re ready to book!
If you have any questions about these tips or tools, feel free to email me at teylor@wouldrathertravel.com!