How to Budget for Travel Costs

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Travel is expensive, and it’s easy to under budget. Here’s how to budget more accurately for your vacation.

On any trip, you have four major expenses: transport, accommodation, food and drink, and activities. You also have two other expenses you might forget to include: travel insurance and incidentals (souvenirs, bottled water, and so on). Let’s break down each expense and how you can better prepare for each of them.

Transport

Transport to your destination is often the biggest cost. Flights—especially internationally—aren’t cheap. They can turn a cheap week away into a budget-blowing, once-in-a-lifetime trip.

The Kayak homepage.

Flight prices are relatively easy to budget for, though. Check websites like Kayak or Skyscanner to compare prices on a few dates you’re considering and book those that work best. You have to purchase the tickets in advance, so the expense is locked in long before you leave.

Transport after you arrive at your destination is trickier and can also be quite pricey. It’s helpful to consider:

How you’re getting to and from the airport, both at home and abroad. Four, $30 taxi trips will cost an extra $120.
How you’re getting around daily at your destination. Is there a good public transport network? If so, is there a daily unlimited pass? Are you going to have to Uber? Do a bit of research, and budget accordingly.
If you need to rent a car. If so, be sure to include the cost of any insurance you might need along with the rental fee.
If you’ll be traveling between destinations once you’re there. Train tickets are expensive and, like flights, better booked in advance.

The good thing about transport is, as long as you do your research in advance, you won’t be surprised by the costs.

Accommodations

Along with transportation, where you stay is another significant cost of traveling. Again, though, as you’re most likely to book it in advance, it’s predictable.

The first thing to do is to decide what kind of accommodation you want. Generally, hostels are the cheapest, Airbnbs are somewhere in the middle, and hotels are the most expensive. You can usually get a hostel bed for about $25 per night, an Airbnb for around $100 per night, or a hotel room for close to $150 per night (of course, there are exceptions to all of these).