How to Build Your Best Travel Budget

By Nick Wharton on 2 January 2017 0 comments

Some people live for trip planning, while others would rather get it done quickly and just enjoy their vacation. Whichever camp you fall into, creating a comprehensive travel budget is a crucial part of the planning process and will help ensure that you have the best trip possible. (See also: 10 Things You're Paying Too Much for When You Travel (And How to Pay Less))

Instead of worrying about money while you're away, a travel budget can help you to enjoy, relax, and live in the moment, knowing that you're not going to come back to a pile of debt. By planning out your finances before you leave, you may even realize you have a little money to spare for a fun activity or excursion while you're away.

Planning a travel budget can present a challenge, however, especially if it's your first time visiting somewhere. Here are a few ways to make your perfect travel budget a little easier.

1. How Much Will My Trip Cost?

This is the most basic and yet important question you will have to ask when planning your travel budget. There are several factors you need to consider.

In broad brush strokes, you'll want to think about two main components: the cost of things at your destination, and your travel style. Is it vital you stay in five-star resorts to enjoy your destination, or could you be just as happy in more modest accommodations? (See also: 9 Travel Expenses You Forgot to Budget For)

2. Define Your Travel Style

Travel takes many shapes and forms, from luxury trips with five-star accommodations to roughing it on a backpacker's budget. (See also: How to Say in a 5-Star Hotel for Less Than the Cost of a Motel)

While making your travel budget, it's a good idea to decide where you want to indulge and where you're okay doing with less. For example, maybe you're happy to stay in budget accommodations to make sure you have enough money for an expensive, once-in-a-lifetime activity. By making this a conscious decision, you can enjoy your splurges while knowing that you're making financially sound decisions that you can afford.

3. Consider Costs at Your Destination

The cost of travel can vary greatly in different countries, or even in different regions of the country where you live. For instance, you're going to need to plan a much bigger budget for a trip to New York City than for upstate New York. Websites such as PriceOfTravel.com and BudgetYourTrip.com can give you ballpark figures for travel costs in various destinations. (See also: 40 Most Useful Travel websites That Can Save You a Fortune)

You'll need to factor in the price of transportation to the destination and on the ground while you're there, plus accommodations, activities, and food. Be sure to check if you've earned any free travel through airline, hotel or credit card rewards programs. That could significantly reduce your trip costs. Credit card perks such as free rental car insurance can also help leave more breathing room in your budget. (See also: 6 Easy Ways to Get Free Travel)

Generally speaking, the Internet can be useful in figuring out approximate costs at your destination. However, keep in mind that larger booking sites may only list more expensive hotels and tours. Smaller mom and pop type businesses won't necessarily be included. Check out reputable travel blogs, online forums, and guidebooks for accurate information on less expensive, off-the-beaten-path options.

Just make sure to look at when your resources were published and try to get the most up-to-date information. Prices can change quickly, and using outdated information in your budget could set you up for a nasty surprise when you get to your destination. (See also: 10 Sneaky Vacation Costs That Add Up Quickly)

Known Expenses

With this research, you'll find you can figure out most of your big expenses in advance.

If you're booking your accommodations ahead of time, it will be easier to factor into your budget since you will have an exact amount before you leave home. If you're going to book things as you go, you'll have to use your research to estimate what you will spend per night on average.

Some expenses go hand-in-hand. For instance, knowing whether your accommodations will have a kitchen can help you better estimate your food budget: Will you be going out for every meal, or cooking some of the time? (See also: 14 Ways to Cut Food Costs While Traveling)

Consider, too, whether you want to set aside some money for souvenirs and gifts, and be sure to factor in these expenses as well.

Unknown Expenses

You will also want to budget some money for unexpected expenses, which could include a health emergency while you're traveling or just the ability to splurge on something you hadn't necessarily planned on.

Assign an amount that feels comfortable to you and include this extra padding on your travel budget so that you avoid coming up short.

Trip planning doesn't just involve an itinerary and wish list of activities and sights. Creating a comprehensive travel budget will help you get excited for an awesome trip, while giving you the confidence that your travel is financially sound.

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How to Build Your Best Travel Budget

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