Figuring out how much money you need to save for a holiday can be one of the hardest parts of planning a trip. We’ve been through it all, and we’ve figured out everything that goes into creating a realistic travel budget.

It can be difficult to find answers about how much it can cost, as the price can range drastically depending on a number of factors, including:

• Destination and Dates
• Accommodation Style
• Activities and Transport
• Shopping
• Eating and Drinking
• Additional Costs

And so many more!

We had a really challenging time deciding on our budget for our year (and a bit) long trip, because we didn’t know if we had thought of everything, and we couldn’t always find the answer for how much things cost in different destinations. Below, we’ll share all of our tips of what we spent money on, and how you can get a better idea of a vacation budget!

It seems obvious, but where you choose to go on a trip is going to have the biggest impact on how much it costs. You’ll need to consider both the destination itself (for example, Scandinavia will tend to be more expensive than southern Europe), and how far it is from you. You should also take into account the time of year that you’re planning to go.

When choosing a destination, it’s always a good idea to get an estimate of accommodation and spending costs, as well as the transport there before you lock in your trip. The easiest way to do this is to simply google “average cost of x in x”, e.g. “average cost of a hotel in Rome”. These aren’t always super accurate, especially if you’re intending to go for cheap options, but you’ll have a rough guide to go off while you’re budgeting for your trip. This will also help you choose between two or more destinations, as prices of food and accommodation can vary greatly.

If you’re looking for the cost of getting to and from your destination, websites like SkyScanner or Google Flights can help you find great deals from your home airport or city to any number of destinations. Rome2Rio is another great resource to find different ways of travelling between destinations with price estimates included.

There’s a good chance you will already know how long your trip can be, usually however long you can get off work. But if you’re flexible in how long you’re going for, it may be worth playing around with your trip length. Not only can you find better flight deals if you change your dates (even 1 day can make a huge difference), but you can also look into discount deals with your accommodation for stays over a certain length. For example, many Airbnbs will have a discount if you stay over a week or a month, so adding a few days to your trip could actually save you money!

You also have to consider how far you’ll be travelling to reach your destination. Coming from Australia, our best options for a budget friendly holiday are New Zealand or Southeast Asia, but if you’re from the US, South America or the Caribbean would be the best pick. It’s also worth remembering that the further you go, the longer you’ll need to stay to make the transit worthwhile. Flying 2 hours for a weekend away is much more feasible than flying 10.

You can also consider domestic holidays if you’re aiming to keep the costs down, especially if you choose a destination you can reach by road or rail. Travelling to somewhere in your own country that you haven’t been to can make for an incredible budget holiday!

Finally, you’ll also want to think about the destination in the context of what time of year you will be travelling. Summer is the high season for tourism in many countries, which means transport and accommodation will likely cost you more at this time of year. Aiming for the shoulder seasons on either side of the high season will give you the best chance at good weather and reasonable prices.

Once you know where you’re headed and for how long, you’ll need to decide what kind of accommodation style you’re after. You probably already have an idea (and you hopefully factored it in to your destination choice) but it can always be helpful to research a few options, especially if you’re travelling with others.

Accommodation can be one of the most expesive part’s of any trip, but you can also make some incredible savings if you’re willing to make some sacrifices on comfort. Accommodation can range in price from hostel dorm rooms, which can be as low as a few dollars a night in some destinations, right up to luxury hotel suites. For us, we like to aim for the cheaper end of private accommodation options (so hotels, airbnbs, or private hostel rooms). However, we do like to have access to a kitchen (which helps us save money on food – more on that soon!) which can up the price a little. It’s all about finding the balance that works for you and your wallet.

• Figure out your hard no line. For us, this is any shared dorm room, as we both get grumpy if we haven’t slept well – an inevitability when there’s people coming in and out at all hours of the night.
• If you’re travelling with others, it may be cheaper to split a hotel room or Airbnb instead of each paying for a bed in a hostel – splitting costs can be a game changer!
• Know the approximate area you want to stay in (we usually research the best neighbourhoods to stay in our destination before we start the accommodation search).
• Consider how much time you’ll be at the accommodation – are you planning to sightsee all day every day, or will you have some relaxing time back at the accommodation?
• Do you need or want any particular facilities, like access to a kitchen, laundry services, room service, or free wifi?

Spending money on sightseeing and activities can really add up, so it’s a good idea to save money here where you can. While some activities are an absolute must, you don’t necessarily need to do all the tourist activities in a destination to have a great experience. Picking your top choices for paid activities and skipping some others can be a great way to save, and can give you more time for getting a feel for the destination without needing to spend anything at all.

Looking up free activities can also be a great way to save some money while still getting to see your destination!

When it comes to transport, you’ll need to think about how you want to get around. Depending on the destination, walking may be the best and most cost effective way of getting around, but in some places that just won’t be possible. It’s always more cost effective to go with public transport (and you can often find prices easily available online), but uber or taxis might be more convenient for you. If you’re interested in using public transport, we have a few guides here about public transport systems in different cities around the world.

Either way, it’s something people often forget when creating their budget, but it’s something you’ll spend money on frequently so it needs to be factored in!

You’ll probably already have some idea about what level of shopping you’ll be doing on the trip. It may only be souvenirs for yourself and gifts for loved ones, or you might be planning to fill a spare suitcase with goodies, but either way it will need to go in the budget.

This is an area that we like to cut down on, since it’s something that’s so easy to avoid. However, we do buy a postcard for ourselves in each country we visit (the only physical souvenir we’ve allowed ourselves). On a longer trip like ours where we’re away for over a year, we’ve also needed to account for buying replacements for anything lost or broken.

Food is a category that can really vary depending on whether you’re planning to go budget with fast food or street food, or you’re going to splurge on upscale restaurants each night. It’s usualy quite easy to find the cost of a budget, average or expensive meal in your destination, which you can use to estimate your food expenses. It’s definitely worth adding a little buffer into your food budget for snacks – you’re likely to eat more while travelling, especially if you’re out walking around a new city every day.

If you’re looking to save even more on eating, it could be worth looking into accommodation with a kitchen and cooking meals for yourself. Most of the time, accommodation with a kitchen won’t cost you that much more than equivalent accommodation without (and if you’re a hostel-stayer, you can often find hostels with a shared kitchen for guests to use) and it could save you a lot of money!

We have been tracking the average cost of eating out compared with making meals ourselves, and to date, an average home made meal to feed both of us has been around $9, while a meal out has averaged $28 together. It’s definitely something to consider, especially for a longer trip, as going out to eat can get very tiring if you’re doing it for every meal.

At the very least, we would highly recommend buying simple breakfasts (we usually go for fruit and muesli bars if we don’t have a kitchen) that you can eat before heading out for the day or carry around as snacks to save you needing to buy anything extra.

It’s also important to remember that alcohol can be expensive in some cities, and can really add up. If you drink, if could be a good idea to think about how and when you’ll drink on the trip if you want to save money (you could limit it to happy hour, or choose to only go out once or twice a week instead of more often).

There are a lot of other costs that you need to factor in when you’re creating your travel budget, some of which you might need to pay before you even leave home. Don’t forget to consider these key things:

It’s been said before, but we’ll say it again: if you can’t afford travel insurance, you can’t afford to travel. This is only really relevant (in our opinion) when we’re travelling internationally and therefore leaving the healthcare system that we are covered under in Australia. I know it seems like such a downer to think about what would hapen if you got injured (or worse) on a trip, but the expenses you could incur if you’re not protected would have a mich bigger impact than the cost of the insurance.

Depending on your country of origin and your destination, you might need to purchase a visa for your holiday. Some countries require you to apply and be approved for your visa before boarding your flight there (such as Vietnam, which has a single entry 1 month visa for US$18), and some will have a visa on arrival system where you pay at the airport for them to allow you into the country (like Cambodia, where you pay US$30 upon entry).

If you’re anything like us, you’ll want to stay connected to family and friends while you’re travelling, and have access to maps and google translate while you’re out and about during the day. You could always use the roaming offered by your normal carrier, but in most cases, a local SIM card is a much more affordable option. We have used a mix of local SIM’s bought in store upon arrival in a country, and e-sims, which can have great deals, especially if you’re travelling to more than one country in the same region. We use Airalo when we get an e-sim, and we have loved it! You can use our code KRISTE3325 to get US$3 off your first purchase.

SIM cards can really range depending on your destination and whether you’ll need access to a phone number or are happy with data only. Don’t forget to compare prices with different carriers if you’re looking for the best deal.

You might need new or specific clothing for your trip, which should be factored into your budget. For example, we knew on our trip that we would be heading into a European winter, and would be travelling up to Tromso in northern Norway, which meant I needed to buy myself some thermals and a good coat. We also both bought a lightweight longsleeve shirt to protect us from mosquitos while we were in south east Asia.

Once again, this will depend heavily on your country of origin and your destination, but it’s always a good idea to check with your doctor before any trip if there are any vaccinations or medications that you’ll need. You should also carefully check the requirements of any country you’re visiting for their customs laws, as you may need to get a doctors note for any prescriptions you might be taking with you.

Don’t forget to factor in a bit of extra medication in case of any delays – you don’t want to get caught out!

It’s no secret that many airlines, particularly budget ones, charge extra for anything on top of just a seat on the plane. If you’re planning to use budget airlines but will be taking luggage with you (yes, even a carry on), you’ll need to pay extra. We’ve found that the best options may not be the most obvious ones (sometimes a normal airline ends up cheaper if they include a bag in the ticket price), so make sure to shop around for the best deal.

The same goes for if you want to choose your seat, check in early, check in at the airport, or have food on the flight. Just don’t be fooled into thinking that €12 Ryanair flight will actually only set you back €12!

If you’re travelling for more than a couple of weeks, there’s a good chance you’ll need to do laundry. You might be able to do this at your accommodation if you have laundry facilities available, but chances are you’ll need to pay for a laundromat or laundry service. This might be as low as a few dollars or up to $20-30 depending on the level of service you go for. For a long trip like ours, we’ve had to factor in a wash every 2-3 weeks.

One of the biggest tips we can give now that you’ve got a good idea of your budget, is to be flexible with it. Make sure you have some leeway for anything unexpected (usually a buffer of 5-10% is a good idea). This just means you won’t be stressing if things turn out to be more than you expected, or if you have a mishap that costs you extra.

What Did We Do?

For our world trip, we settled on a budget of AU$275 per day together (about US$183), which was based partially on our expectations of accommodation, transport, food, and additional spending, but was also based on the money we had to spend and the length of time we were hoping to travel for.

At the time writing this originally, we were around 8 months in to our trip, and had averaged AU$238 per day (across one month in Asia and 7 in Europe). For us, it made more sense to have a daily budget goal as our trip is long enough and varies across destinations, but for you it might be easier to have a budget based on spending categories, or just a budget for your trip as a whole!

At the time of updating this post in 2024, our world trip is complete and we are back home. Our final daily average came in at AU$240.14.

If you’re interested to see how we organised our budget prior to leaving on our trip, you can check out the video we made on our travel spreadsheet:

We made a few adjustments over the course of the trip to add in things we forgot to account for, and we are always open to adding new categories as things came up.

While it might seem overwhelming, budgeting for a trip is a must so you can be sure to enjoy yourself without worrying about how much you’re spending. Having even a rough idea of what you’ve got to spend can alleviate so much pressure, and can help you make the best choices about what to do with your time while you take a much needed break!

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