Whether you spend your holidays overseas or you stay closer to home, travelling (almost) always costs (at least some) money. Today’s article shows you how to make your travel dreams come true – in 4 easy to follow steps.
Travelling can actually be cheaper than living in some places, and you certainly don’t need to be rich to travel.
1. Create a travel budget
There are plenty of people who get an idea to travel someplace and then just go ahead and book their next holiday. Travel ads on TV and glossy Instagram pictures of exotic destinations can be very persuasive (especially if you had a hard day at work). There is nothing wrong with it… if you can afford it.
If you need to watch your pennies, we strongly recommend you don’t get into debt to make your travel dreams come true. Creating a travel budget is the first step to turning your travel dream into reality – whether it is to take your family to the Gold Coast for two weeks over the school holidays or to backpack around the world for a year. And it’s not as difficult or cumbersome as it may sound.
Think about your last trip… What did you spend money on?
Well, I bet you paid for some form of transport to get you (and your family) there (and back) and to travel around at your destination. Even travelling in your vehicle isn’t free. Then, you likely paid for accommodation, food and beverages. And you paid for activities – after all, you travelled to see and do some cool stuff. If you travelled overseas, you may have also paid for travel insurance, visas, to exchange money, buy a local SIM card and the like.
Voilà… these are the five expense categories for your travel budget:
Depending on where you want to go, what time of the year and for how long, where you stay and what you do while there, your budget will obviously differ. So, how do you know how much you might spend?
We like to do a bit of research before we book anything – just to get a feel for our likely spend in each of the above categories and each country.
So, let’s use the Gold Coast family holiday as an example (using our travel budget calculator):
If you don’t have the time for a bit of upfront research, there are a number of websites out there that provide data on the cost of travel per country:
- Numbeo and Price of Travel provide the price of specific items.
- Lonely Planet and Budget Your Trip provide daily averages based on your travel preferences – from budget to luxury.
2. Start saving for your trip
Depending on how much you earn, seeing how much your next trip will cost on paper might come as a shock or will be smiled upon. If you belong to the former group, don’t give up on your travel dream just yet. There are many ways to bring that number down to something more palatable (more on that shortly).
Even if you cut your (travel) costs, you won’t be able to travel for free (unless someone sponsors you). So, start saving… NOW!
Knowing your travel budget helps you set your savings goal. You can then work out what amount you need to save (daily/ weekly/ monthly) to be able to afford your next family holiday or that backpacking trip around the world, without becoming enslaved to a financial institution. And our 40 ways to cut your day-to-day spending may help you achieve your savings goal faster.
Let’s stay with the Gold Coast holiday example, and let’s assume you want to do this trip with your family in six months’ time.
Both your partner and you earn a decent income. You have a small amount of savings but you prefer not to touch it. You have calculated roughly how much this trip will cost you (in this example just under NZD11,000). You have six months to save up for it. Your savings goal is, therefore, NZD60 per day.
Sounds achievable? Good. Set up a regular automatic transfer into a separate savings account, and your travel budget will accumulate in the background.
If the amount you need to save is more than (you think) you can afford and you need more time to save up, start saving anyway (whichever amount you can afford). Then look for ways to
- cut your day-to-day expenses;
- earn some extra money (by doing a garage sale, taking on a few extra shifts – the possibilities are endless); and/or
- make your travel plans more affordable (more on that below).
Delaying your travel plans could be another option, but you’ll be surprised how much you can save if you really put your mind to making your travel dream come true.
3. Book smart and shop around
So, how can you make your travel plans more affordable? Let’s go through the different expense categories in your travel budget.
Reign in your transport costs
If you can travel outside of peak season you will be able to save heaps on transport. Even if you have to travel during school holidays/ peak periods, air/ rail/ bus fares might be cheaper during certain times of the week and hours of the day.
To find good flight deals, we use One Stop Travel Sites or Travel Aggregators. Each shows the cheapest airfares on any given day, so you can choose to fly a day/week/month earlier or later, pending your flexibility. Staying with our example of the Gold Coast family holiday, you can see we chose travel dates at the end of the school holidays to save on airfares.
If you found a good deal book it there and then as prices change constantly. Ideally do your research with your browser in incognito mode, as cookies will show booking sites how keen you are to do a certain trip, which may affect the price quoted – that goes for all online travel bookings.
We tend to not actually go through the flight aggregators, but book with the airline/s directly. The price is the same (sometimes cheaper), and we have a direct contract with the airline (rather than with the middleman) in case something goes wrong.
The best fares generally go first, so planning is important when it comes to transport. The same is true if you want to use air points/ miles, as there is only a very limited number of seats available for any given flight.
When we started our journey in October 2016, Paul and I took advantage of a special Qantas offer, paying only 25,000 frequent flyer points each from Auckland to San Francisco (one way). All we had to pay was the (unavoidable) taxes.
If you plan to travel through multiple continents, you may want to compare passes that offer several destinations as a package (such as around the world fares offered by One World or Star Alliance members) vs booking each leg of your trip individually.
If you are travelling during peak season those multi-destination packages may be a better deal than booking each leg individually. You can do overland sections on around the world tickets too, which means you could supplement your round the world ticket with cheap flights, bus and train rides in between destinations.
Vehicle rental (including relocations)
Unless your trip takes you across oceans, another way to save on transport is to look for vehicle/motorhome relocations. There are websites in many countries offering massively discounted rates (often including fuel and/or insurance) to those driving a vehicle/motorhome from A to B within a certain period. These deals are fairly last minute, and A and B are usually bigger transport hubs, but if that’s an option just search for vehicle/motorhome relocation at your destination.
Speaking of vehicles: If you are planning to hire a vehicle at your destination, it also pays to shop around. Aggregator websites such as Rental Cars or Vroom Vroom Vroom allow you to search across major car rental companies at once. And you don’t have to pay for the hire until you pick up the car.
A final option to save on transport costs is of course… to hitch a ride. While Paul and I did it safely in Dominica on a public holiday (when there was no other option), and we have taken plenty of people along in our campervan in New Zealand, there are many countries we wouldn’t feel safe to hitchhike. Judge for yourself where and when you can and can’t do it.
How to pay less for accommodation
Some of our tips on reducing your transport costs also apply to accommodation. This includes travelling outside the peak season.
When we visited Rio De Janeiro for the Carnival in 2012, we found accommodation prices to be four times more expensive than during other times of the year. Now, experiencing the Carnival in Rio was on our bucket list (so we were prepared to pay a bit more), and we did end up finding accommodation that was affordable (by giving up on comfort).
If you seek unique experiences that only happen during certain times of the year (for example the Oktoberfest in Munich or the Carnival in Rio) book early.
If you don’t have to be somewhere at a specific time of the year, book your trip when not every man and his dog visit your destination. The advantage is not only cheaper accommodation but also a more intimate experience as you’ll be sharing your destination with fewer tourists.
For accommodation, as with any other travel expenses, it’s worth shopping around. When we book accommodation somewhere, we tend to look across a number of one-stop travel sites or short-term accommodation booking sites to find the best value for money.
In our Gold Coast holiday example, we looked for apartment deals via Booking. A quick browse of short-term rental accommodation platforms reveals that the family could rent an apartment of equal quality and location (minus concierge and daily maid) for NZD100 less a night. This would shave a whopping NZD1,400 off their travel costs.
Finally, relocating a motorhome would also reduce your accommodation costs. You may not be able to freedom camp on your route but paying for a campsite usually costs (significantly) less than staying in a hotel or motel room. And in those countries that offer motorhome relocations, the campsite facilities are usually pretty good.
How to reduce your spend on food and beverages
When my mum turned 50, she didn’t want a huge party but instead asked to have a family holiday one last time. Both my brother and I had left home, and I was already engaged at the time. The five of us ended up booking a farmhouse overlooking Lake Garda in Northern Italy. When my parents arrived (they had driven from East Germany), their car was full of groceries. To save money, my mum had decided that we would have every. meal. at home. While she got her wish (mostly), my brother, partner and I snuck out one day to have a nice meal at a local trattoria.
Experiencing local cuisine is often one of the reasons why we travel… whether it be daring to taste grilled insects at a hawker stall in Asia, indulging in some funky vegan food truck dishes in Portland, or munching on a pizza in Italy. You don’t have to eat out three times a day though.
Paul and I tend to only eat out once a day (sometimes only once a week), usually at lunchtime. This allows us to experience local cuisine while taking advantage of awesome lunch deals. It also means we don’t have to roam around unknown parts of town every night in search of a restaurant.
If you cook at your accommodation, you get to experience local markets (unless you bring all your groceries with you as my mum did). We love going to markets, and trying fruit and veggies we don’t get at home.
Cooking at your accommodation gives you some home comforts (especially if you live on the road as we do) and your stomach a break from the local cuisine (there is only so much rice and beans one can eat in a lifetime). And if you are staying at shared accommodation, cooking at home could introduce you to new friends – your hosts and fellow travellers.
In our Gold Coast holiday example, we assumed the family would eat breakfast at home. That could be an option if you want to save money but don’t want to cook while on holiday. Given breakfast prices in a Gold Coast café are (almost) the same as lunch prices, having breakfast at home saves this family NZD15 per person per day (or NZD840 over two weeks).
How to save on activities
Many activities (and some of our most treasured experiences) are free or cost very little. On our journeys, we have
- Visited many museums free of charge (including the Colosseum and Forum in Rome which is free on the first Sunday of the month);
- Joined Al Green’s Baptist Church Service in Memphis to experience local community life (rather than pay the exorbitant entry fees at nearby Graceland);
- Attended free guided walking tours through Buenos Aires and Merida (you pay a tip at the end based on your budget and how much you liked the tour) and most recently, a free guided walking tour as part of Auckland’s Heritage Festival (which even included coffee and scones afterwards);
- Did countless self-guided walks and used public transport to get to know a city;
- Hiked in the Andes in Ecuador and climbed volcanoes in the Caribbean;
- Swam and snorkelled at countless beaches, using tree shade rather than paying for parasols; and
- Attended free performances and danced with locals in Cuba.
Just search free activities for your destination and chances are someone has made a nice list for you already. Here are some examples
- 33 Free and Cheap Things To Do in Queenstown
- Top 10 Free Things To Do in Paris
- 40 Free Things To Do in Rome
Even if you are visiting a destination with a specific activity in mind, you can still save money. If you are travelling as a family, make use of family passes (if available). Look out for special deals and discount coupons. Definitely shop around.
What about your other travel costs?
Make sure you check the entry requirements for your destination to avoid costly surprises (or worse: being made to return home). Paul wasn’t aware that he required a visa when we visited Trinidad and Tobago earlier this year. He ended up being penalised with TTD400 (about USD65 at the time). Ouch.
4. Pay for your trip (without getting into debt)
Even if you’ve saved some bucks by shopping around and booking smart, you still have to pay some money.
Smart use of credit and savings
As mentioned above, we do not encourage you to get into (or increase) your debt to afford your trip. What we mean with smart credit is to use the advantages of credit cards (interest-free periods, ability to dispute transactions, rewards and travel insurance) without being penalized by the disadvantages (particularly exorbitantly high-interest payments).
Our credit card statements are issued at the end of the month. So if we can, we time bookings to occur just after the last statement has been issued so that we maximize the interest-free period. We apply this approach to any bigger purchase. The money we don’t pay straight up earns us interest in the meantime. It may not be much but it all adds up in the long term. Once we have the statements, we pay them in full. Every. Single. Month.
Let’s look at the Gold Coast family holiday again: You have created your travel budget, and you have set up an automatic transfer into a separate savings account, saving NZD60 a day. Now, just after your next credit card statement has been issued, you book your flights. By the time your credit card statement has to be paid, your travel savings have grown enough to cover your flights (Cost of flights: NZD1,800; savings after 30 days: NZD1,800). Easy, right? If the process is repeated two months later for accommodation, and finally for activities, your family will be able to pay for the trip without (further) debt.
Finally – Keep an eye on your (actual) spend
Interested in further readings? Here are some links we have come across during our research: