How to Determine Your Travel Budget

Traveling is supposed to be a fun experience. Whether you are traveling to get some rest and relaxation, go sightseeing, try out a new activity or simply experience some new culture, it allows you to take a break from reality and get away from your everyday routine.

We all have dream vacations we want to experience one day, and unless money is not an object, traveling requires a budget.

A travel budget is what will determine where you can go, how long you can go and what you can do while there. In order to determine your travel budget, you will need to follow these guidelines.

 

Take a good look at your finances.

Take a look at the money you’re going to use for your trip. Do you already have money saved? If so, determine how much of that saved money you can put towards your trip without sacrificing any of your normal amenities, activities or bills. You don’t want to take a great vacation only to come home and not be able to afford to pay your mortgage.

Are you planning on using money from your savings account to pay for your trip? If so, how much can you afford to spend without blowing your entire savings? As a rule, you want to try and keep at least three month’s worth of income in your savings account at all times.

Figure out how much money you have to work with after all of your regular expenses and determine what you’re comfortable spending.

Calculate the cost of your trip.

Now that you know how much money you can afford to spend, you need to determine if it’s an accurate amount of money for your trip. Create a spreadsheet and enter the cost of transportation, accommodations, sightseeing and entertainment, passport or visa fees (if applicable) and vaccines and medications (if applicable). If you are flying, but you are taking a taxi/limo/car to the airport, add in these travel fees as well. If you are parking your own car at the airport, calculate parking expenses as well.

Along with these items, add in the cost of new clothes or toiletries needed for the trip, a house sitter (if applicable) and pet boarding (if applicable).

Once you have all of these expenses calculated, add an additional 10 to 20 percent to account for any expenses you may have overlooked or any unexpected expenses while on the trip.

travel budget

Photo source: http://www.flickr.com/photos/rmgimages/4882450962/

Calculate spending money.

After you have the total of your vacation, subtract it from the amount of money you planned on using toward your trip. If you have money left, this is what you can use on food, drinks, souvenirs, shopping and other miscellaneous costs while on vacation. Divide the amount by the length of your stay to get a per day average on the amount of money you’ll have to spend.

If your calculations came up with you being in the hole, you’re going to need to make some adjustments. You will either need to reassess the amount of money you can use towards the trip, or you will need to find cheaper alternatives for certain items in order to have money to spend while on vacation.

Make necessary adjustments.

If you need to cut back on your travel expenses, try looking at your entertainment allowance first. Check out the activities you had planned, and try knocking a few of them off your list. Try to remove only those that weren’t that important to you or your family to begin with and keep the ones that were essential to your trip.

You may find that removing a few activities will also reduce your travel costs, as you won’t have to pay to travel to and from these activities and your hotel. You can also try to find cheaper travel alternatives, such as the use of public transportation instead of taxis or limos.

If you still need to lower your costs, try lowering the amount of money you plan on spending on souvenirs and shopping. Try to eat at cheaper restaurants or even purchase groceries and eliminate dining out altogether.

Be content and realistic.

You have to stay somewhere and you have to eat, so you can’t eliminate these items from your list. Once you have made a successful budget, you need to be able to realistically use it while on vacation and you have to stick with it. Don’t dwell over the fact that you couldn’t partake in every activity and instead relish the fact that you are able to travel and spend time with your loved ones.

Carrie Wood lives in Dallas and works for a travel agency. She works hard and likes to spend her time off at resorts in the bahamas.

Photo credit: konikaori

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