Money management is an important issue when it comes to travelling. There is a variety of apps designed to manage day-to-day finance but none of them can be easily applied to plan your expenses during a trip. That’s why I decided to share with you how I do a budget before a trip. Normally, I do some research before I take off so that I won’t have to worry once I land on the foreign land. You will find some tips below and a simple tool (xcl.) that I use to budget my trips.
It is the first thing I take into account. I start with flights because I am usually quite flexible. If the fare is lower, I may consider changing my plans to fly one or two days later. The cheapest flights are usually in the middle of the week or on holidays, e.g. December 31st. I use Skyscanner to do the first research because it allows me to check out: which carrier is doing the flight, what are the transfer options, what is the duration of flight etc. Then, I go to the website of the individual carrier and check the prices and promos. I also shop for occasional bargains and sign into specific mailing lists.
Initially, I check the overall price level on Booking.com. I pick up the place and date, choose the first hotel from the list and click: show the map. I then jump around the hotels on the map and do a quick check of the prices in the area I want to overnight. This way, I do it efficiently, because I can see the prices of all hotels in the neighborhood. I do the same with AirBnb as it is may second choice in terms of accommodation websites. After the initial research I more or less know what standard is available for which price. Once I decide how much can I pay, I pick-up the best price-to-quality ratio hotel and book it. Almost always with an option to cancel the reservation as my plans may change. If possible, I use Genius discount and shop for some daily promos. Sometimes, when I am sure that my dates are certainly fixed, I check out local Groupon website because it often offers some excellent deals.
Another group of costs are related to all types of transportation in foreign country. I check online what are the fares for airport taxi, local subway, shuttle or train. If I stay in major city for a few days, I figure out how to get a 24-hour or 7-day ticket. The transportation is worth checking in advance especially in case of the taxi fares. I remember landing in Bangkok and getting into the taxi, which should cost about 40 Thai Baht to my hotel. The driver asked for 90 but after a brief talk we ended up on 50, what was an acceptable price for me. At the end of the day, it doesn’t matter that much if I pay 10 percent more because in less developed countries the currency is not that strong anyway. The point is: if possible – don’t overpay. Even if it is a fraction of your costs, it is worth remembering: a million consists of cents. I always bargain but never too much so that I will not disrespect the local people.
- Food prices
In my case, the food is one of the most important aspects of every voyage. As a person keen on sport I have to pay close attention to the composition of my meals. Therefore, well in advance I check out the prices of groceries. I definitely recommend numbeo.com – a very helpful website for planning the food expenses. To be short, you just have to type the name of the city that you are going to visit and numbeo will show you a variety of prices: groceries, estates, gasoline, meal in the restaurant etc. Hence, I know more or less how to estimate the food budget for each day. I then multiply it by the number of days. But… You have to be careful while planning this way. You can find a lot of info online that a meal in Thailand costs about 2-3 $. It is true, you can find a small meal for this price on the street stall. However, if you want to eat something in a regular restaurant, a bigger portion with steamed veggies you will have to pay at least 7-9$ per meal. That is quite a difference if you plan to stay for a month in Thailand.
- Attractions and events
Before I visit any place, I want to get inspired. I check what are the top attractions and how much do they cost. Usually, google is enough to find the websites of my fellow travelers, blogers or simply the companies that offer a specific type of experience. Then, I create an overall list of the things I will do during the trip and sum up their cost. However, this method is not possible in case of less developed countries, e.g. Laos. I therefore check out TripAdvisor and search through the comments about a given place.
- Unexpected costs
There is always some kind of cost that cannot be foreseen. It usually boils down to a pocket money for small expenses, e.g. a tip in the restaurant or some guilty pleasure. It is also a margin of error in my calculations. I don’t really do the prognosis very precisely. It is more like a point of reference so that I know during the trip that I don’t overpay for something. This category in my budget equals to 10 percent of my local expenses. In other words, if food, attractions and transportation sums up for 1.000$, then I have additional 100$ for extra costs.
This question may be especially important if you plan a longer trip with multiple destinations. Exchange rates change continuously and sometimes they will change the cost of your trip significantly. The examples may include the fall of the Argentinian peso in December 2015. The value of currency decreased by almost a third what means that if you paid in local currency (not in US dollars), your trip has just become much less expensive. The same situation happened in Russia in the second half of 2014. On the other hand, the situation may also go the wrong way, just the opposite. On January 15th Swiss National Bank announced that the Swiss franc would not be pegged to euro any more. In practice, the value of euro has significantly decreased and trip to Switzerland has become about 30 percent more expensive.
- Sum it up and think
When I did my homework with each category, I sum them up. Then, I can clearly see how much money do I need. I have to keep a peaceful mind during the trip and not to worry about the shortage of cash. I also watch the prices closely and think whether it is possible to cut some costs. It doesn’t mean to resign from something but rather to think creatively how can I do it cheaper without decreasing my standards. You can read more about it in another post: how to cut the costs of the trip.
As an appendix to this article I enclose my typical xcl. planner that I use to budget my trip. You can download it for free and use it in accordance with your needs.
The document is really easy to navigate and you will find the manual along each bracket. The only thing you have to do is to do your homework, check out the prices in Google, and put them into the document. The xcl. will sum it up for you at the bottom of the document. If you have any questions how to navigate through the document – please feel free to ask questions in the comments section below the article. This way I will also help other who may have similar problems to yours.
God luck with your planning! :)