TRAVEL BUDGETING

Get Yourself FinLit

Travel Budgeting

Travel budgeting is a tricky one. When you go on that big overseas adventure, you’re supposed to try all sorts of new things, from exotic foods to extreme sports. You’re supposed to be spontaneous, wild and free. But ironically, being free costs money – and often lots of it.

When we talk about the beauty of travelling, we tend to forget about all the planning and discipline that goes into a big trip. But, trust us, it’s a thing. You’ve got to be sensible enough with your money to actually save up to go away in the first place. You’ve got to find that happy medium between the adventurous cool dude and the money-wise planner nerd, even if you don’t publicly admit it.

How much do I need to save?

If you’re planning to travel somewhere you’ve never been, it’s hard to know how much cash you’ll need to put away. A good option is to figure out a daily budget for your destination(s), then multiply that by that amount of days you plan to go.

For example, in Bali you can live pretty well on $60AUD per day. So if you want to stay for a month, that’s $1,800. Then you’ll need to add on the extras, such as flights, travel insurance and specific activities that might cost extra. You might find that you want to have about $2,800 - $3,000 for the trip (although it’s very dependent on how comfortably you want to travel and what discounts you can swing – there are cheaper ways to travel).

If you’re unsure how to figure out a daily budget, Lonely planet has costs guides for basically every country you’d want to travel to. Here's the one for Indonesia

Saving

Once you’ve figured out a daily budget, how long you want to go and the extra expenses, you’ve got your budget. Now you just need to start saving for it.

Let’s stick with the example of the Bali trip for one month. If you’re putting away $280 per week, it’s going to take you 10 weeks to pull that cash together. That’s two and a half months. Obviously if you can’t put away that much it will take longer and if you can put away more it will take less. It’s all about planning your money strategically, which you can read all about in our everyday budgeting section.

A Buffer

As previously mentioned, travelling is supposed to be spontaneous and wild and free. So how are you going to be a wild and spontaneous vagabond if you’ve got a daily budget to abide by? Maybe you need to get yourself an extra buffer, for all those days you “accidentally” splurge a little bit. Maybe you want to save up an extra $1,000 - $2,000 just so that you can enjoy your holiday to its fullest.

There’s also the possibility that something really bad could happen. You might lose your passport, miss your flight or find yourself in some other twist of fate whereby you lose a bunch of your hard earned money. In this case, you’re going to need a contingency plan, which is best in the form of cold, hard cash. Consider saving up an extra chunk of savings that you don’t intend to spend. Just in case.

This information is intended to be general in nature and should not be relied upon for personal financial use.

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