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Figuring out a travel budget is perhaps one of the more challenging aspects a family faces when deciding to travel. In fact, even writing this article was a bit challenging because everyone approaches it differently. Factors such as time of year, the length of trip, desired destination, dining, activities, and accommodations all play a role in determining how much you’ll spend on this year’s vacation.
I’m approaching creating your travel budget from two different angles, how much you want to spend and where you desire to travel.
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Creating a Travel Budget Based on Dollar Amount
If you’re locked into a set dollar amount for your vacation, follow these steps. To begin with, I’m a huge fan of spreadsheets and track our expenses there. I guess you could call that the pre-step. However, pen and paper work just as well.
Determine your categories of expenses. I suggest at least the following:
- Flight or Gas to Drive
- Rental Car (if flying)
- Transportation Costs (subway, tolls, trains, etc.)
- Travel Insurance (link to world nomads)
- Unexpected Costs
Give your self a buffer zone with the unexpected costs. We all know something comes up when we’re out and about that we don’t expect. If you want to keep to a strict dollar amount, this is key. Bonus, if you don’t use it, you come home with a little extra that you can put to your next trip.
Decide if you’re going to fly or drive. You may need to know some flight prices at this point. You can approach this in one of two ways. Visit a site such as Kayak Explore, to see how far you can go based on your starting point. Or, decide which is cheaper, to fly or drive to this destination. I wrote a detailed article here on how to decide which is best, and most cost effective.
Research. Research. And more research. If you’re locked into a set budget, you will have to spend time finding the best prices, especially on accommodations. Here’s a list of a few sites I use to find the best prices on accommodations.
- Hotels Combined – I like that this site takes all the popular travel sites and combines them into one search.
- Airbnb – Seeking a home away from home? Get $40 towards your first stay if you’ve never used it before by clicking here.
Keep researching. Pinterest is a wealth of information on how to keep costs down, but more, how much it may cost to eat in a destination, find the best travel deals on accommodations. Read more on how to use Pinterest for more than just travel wanderlusting.
Keep your findings and bookings on track with Trail Wallet. This is one of my favorite apps to not only plan out what my day to day budget, as well as the overall budget will look like, but also to keep me on point during the trip.
Creating a Travel Budget Based on Destination
If you have a destination in mind, you can create a travel budget and create a saving plan for the trip. Ultimately, many of the steps are the same with a few modifications.
Just like above, you’ll create your categories of expenses. You’ll fill in the amounts as you come across the expenses.
If you are flying, and know your destination, you’ll want to sign up for Airfare Watchdog. This site tracks your home to destination flights and alerts you with the best prices as they come through. You can set up as many alerts as you wish, but be prepared, you may receive daily emails. When you lock in a flight, you can place this as part of your budget.
Depending on where you’re going, you’ll still need to know the cost of attractions and other expenditures you’ll have your trip, including dining. Add these to your spreadsheet or to Trail Wallet.
Save for your trip. Now that you know what it will cost, it’s time to save for it. I use a budgeting app call YNAB -You Need a Budget. I use it to plan for vacations, but also all my budgeting categories. It changes the way you think about budgeting, planning with the money you have, not the money you think you’re going to have. It has a slight learning curve, to change your overall budget thinking. All in all, however, it’s been a game changer in how I save for vacations, as well as daily expenses.
It may take a few passes through your steps to ensure it encompasses everything you need. But both approaches to figuring out your travel budget should give you an idea of where you can go, or what you’ll spend on your vacation. If you want to ensure you stay within a budget, one of these methods, along with the tools mentioned should serve you well.
What are your thoughts? Do you have any additional methods to make your budget fail-proof?