Manage Your Travel Money Without Going Insane
Posted on 08. Nov, 2011 by Steph in Advice, On the Road
When you are traveling long distances on little money, it’s really important to develop a system for managing and conserving your money.
Unfortunately for me, I’ve never been very great at budgeting. Back in my old life I was vaguely aware of the amount of money I had in my account, and as long as I didn’t run out I was happy. Yes, I did manage to save twenty thousand dollars in a year and a half, but I’m definitely no money genius.
Out on the road I’ve been forced to get a little bit better. I make my living online now and while it’s fun it’s not really super duper profitable, so I do need to keep track of where my pennies are going. So, while I’m still no expert, I thought I’d share a bit about how I keep things under control.
Do Your Research
photo credit: m+A+s
What makes budgeting for travel difficult is that it’s a game where the rules are constantly changing. In every new country there is a new standard of living, even a new currency. You have to figure out currency exchange, new bills and prices.
That’s why the first step of budgeting is figuring out what’s reasonable to spend in a new country. A cheap travel budget in Australia is an exorbitant budget for China. Ask around, read some blogs and check out hostel prices (a good rule of thumb I’ve heard is that a decent daily budget is the price of a hostel room x 3, or 2 if you’re going to be really frugal).
Be Realistic
Worth it
I keep my travel costs low by staying in hostels, eating cheap and using my feet as my primary sightseeing method. I do what I can to keep my costs down, but at the same time I know myself: I’d rather pay a dollar or two more for a better meal, I’d rather take a cab if it’s pouring rain and if a private room is only $5 more than you better believe I’m going to be all over that.
Don’t hold yourself to an unrealistic standard. It’s just going to make you miserable and guilty every time you step over the line (and you will- nobody can eat toast and cheese forever). Base your budget on your actual behavior, not your desired behavior. Leave room for a lapse in willpower, splurge or a special activity.
All this is to say: overestimate.
Keep Tabs
photo credit: Dave Dugdale
Once you’ve settled on a daily budget for a given place, the second part is to make sure you are sticking to it. It’s up to you to set up your own system for this. I’ve known people who were meticulous record keepers and those who forgot to check their bank account until it started flashing zero. I fall somewhere in the middle: I monitor my accounts frequently and occasionally tally up my daily costs to check if I’m on the right track, but I don’t obsess.
Prepare for Emergencies
Even if you stick to your budget precisely, things can, and probably will, go wrong. Things get stolen, people get sick and then there’s that one night when the only room with a roof you can find costs $75. Don’t put yourself in a situation where a minor setback throws off your whole trip. Have travel insurance of course, and some extra money stashed away for an emergency.
Little Things
They do add up after awhile. Try to stop the small gaps where your money leaks out. Food and alcohol are usual suspects, but the biggest unexpected money drain can be ATM fees. Without a good card you’re going to get charged up to $10 a transaction. Try to find a card that doesn’t charge you for overseas transactions (they exist! I recommend Charles Schwab for Americans) and take out money sparingly.
So basically it’s all about having realistic expectations, will power and keeping track of where your money’s going. Not the most thrilling of past-times, but anything that keeps you out there longer right?
This article was written by me, sponsored by Travelex.
39 Responses to “Manage Your Travel Money Without Going Insane”
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ElizabethJ_Bird
08. Nov, 2011
Great Advice – Money Management can be one of the trickiest parts of travel. Another great bank for Americans is USAA – you have to have some affiliation to the military (parents, grandparents, etc), but if you can use them they are wonderful.
Christy @ Technosyncratic
08. Nov, 2011
ATM fees are the worst!! I get so annoyed paying those, so before leaving the States we signed up with a small bank that has no ATM or foreign transaction fees. No fees at all! We also use CapitalOne and they don’t have any foreign transaction fees either. Boo-yeah!
We keep track of every penny we spend on the road (and then share it on our blog) — it helps us see where our money is going and then is also (hopefully!) useful for others as well.
Steph
15. Nov, 2011
That’s great, I’m sure that is a useful resource for others.
Erin
08. Nov, 2011
I agree that it’s really important to keep track of your spending. We write down everything we spend in a spreadsheet. Not only does that make sure you are on budget but it’s useful information about travel costs that you can share with other travellers too.
Having a contingency is important too – there will always be little extras or emergencies that come up.
Steph
15. Nov, 2011
I really do wish I was more disciplined! Maybe that will be my New Years resolution.
Mandy D.
08. Nov, 2011
This was a very helpful post. I know you mentioned you had $20 grand saved, but is there an amount you recommend to have stashed at the minimum?
Steph
10. Nov, 2011
It depends on how long you are traveling and where- but I think 20k for a year is very responsible, 15k minimum.
Sean
08. Nov, 2011
Good advise. Anyone know of an irish bank with the perfect card for travelling?
Steph
15. Nov, 2011
I’ll try to ask around on twitter for you…
JT
08. Nov, 2011
Thanks for the tips. As for Banks, HSBC has an account that has no international ATM fees when withdrawing from their ATMs, worldwide. Its the best one I have found so far.
Steph
15. Nov, 2011
Thanks for sharing.
Global Basecamps Adrienne
08. Nov, 2011
Great tips! Can’t wait to use them on the road!
Naomi
08. Nov, 2011
I definitely agree with this list, but especially with your ‘be realistic’ point….most recently, I went to the Philippines, and while I know I could have done it for much cheaper, there were times when I wanted to spend a little bit more on the nicer room, the nicer meal or the nice activity. By tempering those little splurges, I didn’t wind up regretting them!
Steph
15. Nov, 2011
Yup, that’s definitely the way to have a good time without guilt.
Dave Dugdale
08. Nov, 2011
I am so glad that you liked my Flickr photo so much that you included it on this page. (calculator)
I enjoy when people use my photos that I work hard on, but as I noted on Flickr below each photo I let people use my photos on the condition that they provide me credit to my learningdslrvideo.com site.
Please add my link when you can.
Nomadic Samuel
09. Nov, 2011
These are overall great tips. I especially like the ‘being realistic’ part and not being afraid to spend an extra dollar or two at times for some upgrades.
Steph
15. Nov, 2011
I think it’s neccesary- if I didn’t splurge on a good dinner or private room once in awhile I’d probably lose my mind!
Scott - Quirky Travel Guy
09. Nov, 2011
Good common sense tips. And I think anyone who saves 20k in a year and a half is clearly a money genius. That’s an insane accomplishment!
Steph
15. Nov, 2011
Haha thanks- a lot of it had to do with living at home and being super boring.
Chris
10. Nov, 2011
Great tips! I’ll be featuring this post in my Recommended Reads this week
Natalie Lyall-Grant
10. Nov, 2011
You say you saved twenty thousand dollars to travel, but how long did you travel for on that and what would you say is your average daily budget?
Steph
10. Nov, 2011
Average daily budget varies wildly from place to place. Here in Colombia it’s around $50 a day, in Cambodia it was more like $20. In Europe it would probably be close to $100.
20K got me through roughly 10 months in Asia and Australia, and a couple of months back home. Australia was the biggest money suck- I spent more in 2 months there than 4-5 months in South East Asia.
Tracey
15. Nov, 2011
HI Steph, A great way to save money in Australia is to House sit. It’s quite popular in Oz and a couple of years ago we saved a bucket of money when we house and pet sat over the christmas and new year holidays. This is the period in Australia when the schools have their long summer break so lots of people looking for house and pet sitters. Do you think it would be helpful if I wrote a post on it?
Jill
15. Nov, 2011
I want to read a post on this!!! Please?
Lusso Bags
10. Nov, 2011
You can also use Evernote to keep track of spendings (as well as other important documents, health records, and useful/needed info when traveling). You can upload pics of receipts too, which is especially helpful if traveling with group or companion who will be reimbursing you for costs afterward; tag the person’s name with the receipt note and file.
Steph
15. Nov, 2011
That’s a good idea. I’ve used Evernote for trip planning but never expense recording- like it.
Gerard ~ GQ trippin
10. Nov, 2011
Good post! My CS atm card just arrive a couple weeks ago. And I’m starting to use Expensify for my expense tracking. The pre-trip expenses are starting to add up!
Steph
15. Nov, 2011
I will have to check out expensify!
jade
10. Nov, 2011
Great tips, Steph. I also brought a water bottle that filters the water for you… it added a little weight (not that much though, as it fits inside the water bottle) and it saved us so much money from buying water. highly suggest this!
Steph
15. Nov, 2011
Great tip- I should look into this!
Colleen Hayward
13. Nov, 2011
Fantastic advice, I certainly don’t want to be stranded in a country or looking for a way back home early because I budgeted wrong
Steph
15. Nov, 2011
That’s another good point: Always have enough in reserve to get home!
Tracey
14. Nov, 2011
I remember talking to a couple of girls in Malaysia who were upset about staying in a filthy hostel where they were paying $5 each per night. I gave them the name of a small family hotel that was charging $12 per night for a room. For an extra $1 per night each they got a nice clean private room. They soon cheered up. Sometimes it pays to seek out those little family places.
Steph
15. Nov, 2011
Haha yeah, now that I travel in a pair I’m a big fan of the private rooms- just a little extra for so much more!
Active Planet Travels
16. Nov, 2011
Oh my god that sandwich looks delicious! I think I’ll be making one of those tomorrow! lol As far as your advice-priceless. The price of a hostel x 2.5 is a good standard to go by for me
Steph
23. Nov, 2011
God tha sandwich was amazing. One of my top 5 sandwiches like, ever.
alexis
18. Nov, 2011
Great post! Money is the biggest issue that stops most of my friends from traveling. During travel though, it’s hard to keep track of where your money is going specially if you wanna get the most out of your vacation. I usually try to over budget on everything and save more money than i think i would need. Just for those emergencies that you mentioned. =)
Steph
23. Nov, 2011
Definitely a wise strategy. There is nothing scarier than the prospect of running out of money.