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Creating and Sticking to a Travel Budget

No traveler wants to count pennies while on their dream trip, but the reality is that most of us can’t afford to throw out our budgets and deal with the fallout once we’re back at home. While creating–and sticking to–a travel budget isn’t glamorous, it’s also not that difficult. With a bit of pre-planning, some organization, and, most importantly, a little self-discipline, making and abiding by a travel budget is easy and won’t detract for the enjoyment of your trip.

create a travel budget

Creating a travel budget helps you enjoy your trip


Creating a Travel Budget

Start with the fixed/non-negotiable costs.

If you have an idea of what you want to spend (or what you can afford to spend), start with that amount and work backwards by deducting your fixed costs first. What are the fixed costs? That may vary depending on your travel style or your plans. For some people, it’s a nice hotel, while for others it might be a certain tour or activity they can’t miss.

Think of your fixed costs as the things that you can’t or won’t change, and the things that will make your trip. For example, if you’re headed to Iceland and planning to road trip around the country, one fixed cost is your car rental. If you’re going to Rome and you have your heart set on taking a private tour of the Vatican, that tour is one of your non-negotiable costs. If you’re traveling in France and you know you’ll need to get between Paris and Lyon, the cost of the train ride is a fixed cost.

Build in your hotel costs in your travel budget

For some, staying in a nice hotel is very important

If you can, pre-pay these costs, or pay them with a credit card. This will help you keep these costs separate from your daily on-the-ground spending.

Add up all these fixed, non-negotiable, and pre-paid costs, and deduct from your total budget. The amount left will cover your food, sightseeing, activities, and other extras.

Make a daily plan for sights and activities, then add in the extras.

Next, sketch out an idea of what you plan to do each day. You don’t have to stick to this schedule, but mapping out what you think you’ll do will help you get an idea of how much you’ll need to spend each day to see and do everything you want.

Add up all the costs of museum admission, entrance fees to any sights, and the cost of activities.

Need a latte every day? Build it into your travel budget

Need a latte every day? Build it into your travel budget

Next, plot out an average cost for public transportation, meals, and extras like bottled water, taxis and tips. For meals, come up with an average price for each meal, but be sure to account for one or two “splurge” meals depending on your preferences. For example, you might figure that each day you’ll spend a few dollars per person on a coffee and pastry for breakfast, 8-10 dollars on a light lunch, and 20-30 dollars on dinner. But you know that on two days, you might have a nicer dinner, so increase the budget for those two days accordingly.

Add up the projected budget for food and extras for every day, and then add this to your sightseeing total from above. Say your sightseeing total was $300 for five days, and your food budget was $500 for five days. That’s $800 for five days, which means you have a daily budget of about $160 per day.

Sticking to your travel Budget

Keep a running tally, and always round up

Once you have a rough idea of your daily budget, the key to sticking to it is tracking. No, you don’t need to account for every penny but you do need to keep a rough count of how much you’ve spent. There are three easy ways to do it.

1). Take only a set amount of cash out with you each day. If you don’t spend it all, you can move the surplus to the next day. If you do hit your limit, then you’re out of money for the day (or you can bring a card for backup, but then be sure to deduct from the next day’s budget; you can’t go over budget every day).

2). Keep all your receipts, and take five minutes each evening to add up your spending for that day.

3). Keep a piece of paper or a note on your phone where you jot down everything you spend. $5 here, $10 there. Just keep a running tally and at the end of the day, compare it to how much you had allotted. If you go over one day, reduce your spending the next day.

Add up what you spend every day to stick to your travel budget

Add up what you spend every day

If you use one of the the latter two methods of tracking, round all your spending up to the nearest dollar. Over the course of several purchases, you’ll end up with a few extra “free” dollars at the end of the day.

You can also do this with the exchange rate when paying with cards. For example, if the exchange rate is $11.30 for every 10 euros, tell yourself it’s $12. For every 100 euros you spend, you’ll think you’ve spent $120, but it will only have been $113. By the end of the trip, you’ll have $50-$100 more left than you thought.

Know when to break the budget

No one wants to come home from a trip and realize they’ve spent a big chunk of next month’s bill money, but sometime it’s worth it to spend just a bit over budget. Only you can decide when a splurge is worth it, but in general, it’s worth breaking the budget when:

  • The splurge won’t negatively affect your ability to pay your bills once the trip is over
  • It’s truly a once-in-a-lifetime experience
  • You feel you’ll regret not spending the money more than you’ll regret going over budget
  • If a day or two has passed (it’s not an impulse buy) and you still want to spend the money
Sometimes it is worth it to break the travel budget

Sometimes it is worth it to break the budget on such luxuries as a wine tasting

While budgeting may be the least glamorous part of a trip, for most travelers, it’s a necessary evil. With a bit of planning and some on-trip tracking, it’s easy to create a budget that works for you, and, most importantly, stick to it without sacrificing the enjoyment of your trip.

Written by Katie Hammel for


Monday 6th of June 2016

I also think it's very important to have a budget. Many people tend to overspend on kinck-knacks and other unecessary things, because "they're on holiday."


Saturday 28th of May 2016

Great general guide to keep folks on financial track when on holiday ... awesome post!

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