On this page i will run through some of the ways in which i plan a travel budget and try to highlight how important it is to plan properly (not just setting a random budget) before you leave home. Whether you have a loose budget or a tight budget there is massive benefit in planning your costs prior to leaving ranging from, saving money, reducing risks and actually thinking about what you want to do more carefully just to name a few.
Probably the main reason you plan a detailed budget in advance is to not only realise the expected costs associated with your trip but to potentially reduce your overall costs. Through proper planning it is possible to reduce overall costs by actually spending more time reviewing accommodation options, gathering information on the costs of entertainment and the alike and ultimately the flow of your holiday. by having a detailed breakdown you can also allocate costs to where you really want to spend more money and again tailor you holiday plans to suit.
Reducing risks is another important item and for me this is a major one. This will be covered as well in Travel Planning but from a cost perspective it is equally important. At the end of the day if you have to cut costs and do something potentially dodgy you may wish your holiday was one day shorter (to save a bit of money) and you would have been able to avoid the situation in the first place. Avoiding potential risks can including things like having a transfer from the airport to your hotel at 1am in the morning. Catching a train in stead of a local bus. With all things, risks have to be weighed up depending on your location, circumstances, etc and also more expensive doesn’t necessarily mean safer but it is important to take these things into consideration when reviewing your costs.
While both saving money and reducing risks while you are travelling are both extremely important. Taking the time to plan your costs as far as what you want to spend and where can highlight realistically how long you can spend somewhere and what activities/ attractions you can afford to do. Doing this coupled with proper planning (outlined in travel planning) will help build a realistic itinerary.
SETTING OUT COSTS:
I use excel to create my travel budgets as i find it easy to use with formulas and other functionalities saving a lot of time. I have attached a sample spread sheet for reference
I always split my worksheets for formulating my budget into multiple headings as per the below and are broken down on a daily basis.;
The headings contain the following costs;
- Flights – includes all internal flights and flights to and from home. I keep these as separate costs as generally these are paid well in advance, so it is a quick reference of how much they will/ have cost.
- Transport – includes all internal major on ground transport like car hire, boats and trains. This does not include inner city buses, trams, etc as this is captured else where. The major items are separated so evaluation can take place on the most cost effective method of transport can be reviewed.
- Accommodation – includes all accommodation for the trip per day (night)
- Food Allowance – allowance per day for food. I have this broken up as we both enjoy food so it is important that we will be able to eat how we like. It is also important to note that food is one of the bigger expenses on your trip, so managing this and understanding this means you wont be going hungry and can enjoy yourself.
- Spending money – includes daily spending on souvenirs, inner-city transport and the alike. This number can vary wildly depending on the reasons behind your travel. if you like to spend money then be realistic and put a larger/ more researched number, or if you can control yourself then this number can be reduced.
After the headings above have been established i then use my original budget/ what i want to spend, minus the to and from flights, and then divide it evenly through the above headings. This then can also be done in the reverse to help you realise costs, i.e. cost of accommodation, food, pending money per day and then multiply that by 10 days to realise an initial budget.
Once the above step has been completed it is time to start researching accommodation general living expenses and activities that you may want to complete. This can take a reasonable amount of time depending on the complexity and length of your holiday. Calculating the cost of accommodation is probably the easiest of the lot and sites like booking.com and airbnb are very useful. When working out costs for food and entertainment, it is best to look through the numerous travel blogs and budgeting web sites to get a general idea. It then helps to go to local restaurant websites of where you are going and review there menus for costs as this would generally be in line with the type of food and restaurant you would generally find yourself in. The same applies for transport, entertainment and souvenirs. Your spreadsheet should then look something like this;
Once you have calculated and completed this for all of the days on your trip you should have a pretty realistic budget for your trip if you have taken the time to do this part properly.
I will provide details in future pages with regards to car hire options, flights and other transport methods.
Key items to allow/ think about;
- Travel insurance – ALWAYS
- Time Vs. Cost – what is your time really worth.