How to Make Your Money Last
By NomadicMatt | Published: March 15, 2009
I get a lot of questions about travel in my e-mail. Sometimes though I get so many questions about one topic, I devote a whole blog post to it. Often the questions are simply “what’s the secret to traveling” and “how can I do what you do“. Lately, I’ve been getting some questions about budgeting and making the money last. This great question is something I’ve never touched upon before and the answer is long over due.
Telling people I have been traveling for three years usually makes them think I am rich- how else could I afford to travel for so long. Well, I’m not. (Though I wish I was!) There’s no secret to travel and there is no real secret to making the money last. The way to do it is to not only be smart about how you spend money but be realistic. When I first started traveling, I watched every penny and cut every corner. I also sometimes lavishly spent money like it was going out of style. But no matter how I spent, I always stayed on budget. Because it all starts with the budget. In order to make your money last, you need to start with a good, realistic set of spending expectations.
When I travel, I don’t budget a lot of money for accommodation, tours, or even transportation. I find the cheapest accommodation around or Couchsurf. I don’t do a lot of tours and I walk everywhere. I do budget a lot of money for food and drinks. Lots for drinks. Why? Because that’s what I want to do. I didn’t spend every night at home so I could fly to Australia and not go out or head to France to make meals in a hostel every night. No, not me. I came to live. I came to eat and drink in the culture. Sometimes I go over, sometimes I go under but I always balance out.
The surest way to stay on budget and make your money last is to know what you want to spend it on in the first place. So often travelers get blind sided by unexpected costs that their budget cracks quicker than humpty dumpty. There will always be something you didn’t predict- I didn’t predict having to by a new camera after falling into the ocean with mine.
But people mostly get blind sided by stuff they should have anticipated. “Wow! that tour is so expensive. I blew my budget.” “I didn’t expect to drink so much!” are things I often hear people say. My response is usually “Why not? What did you expect to do on the road?”
And with that starting question, you should plan a budget and how you will make your money last. If you can eat all your meals in a hostel kitchen then a small food budget is for you. If you plan on Couchsurfing every night of the week, then you don’t need to book for accommodation. If you are flying to Europe and know you love to drink wine, you should expect that you’ll probably buy some wine. Budget for it. Be realistic.
Your budget will only last as long as you planned it to last. If you planned your budget well it will last until the end of your trip. And, I can’t say this enough, the easiest way to stay on budget is to know ahead of time exactly what you want to do and the type of trip you want. If you love outdoor activities, over budget because they cost a lot. I know I will eat and drink a lot so I budget accordingly. Do I go over budget? Sometimes. I make it up on other days. But it’s a lot easier to make up an extra drink then a tour to Great Barrier Reef or a constantly going over your accommodation budget. It’s a simple thing but something I think everyone needs to be reminded about now and again.
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Another thing to take into consideration is keeping track of the timescale of your trips. As an example I once budgeted for my starting money to last three months on a year long trip with the plan to get work before the three months were over. Once I was there I was having so much fun that I didn’t notice that three months were even gone before I went to get money and it wasn’t there. So don’t get carried away…
Also – keep track of what you’re spending!! We track our spending daily (or every couple of days) to be sure we know whether we’re ‘up’ or ‘down’, then we can make up the difference by either living a little more frugally or maybe splurging a bit. It’s not that hard, once you get into the habit, to mark every expense in a book, or keep every reciept. Time spent setting up a quick spreadsheet can make it very easy to track once on the road.
Oh that is a good reminder for some trips I have coming up. Thanks!
I found out that even if you have accounted for anything else on your budget, its the discipline that can kill your game plan. When we did our backpacking, we set our plans to take advantage of the Eurorail tickets by taking overnight trains. It only lasted only 2 weeks for me, we made a detour of staying on one town thereafter thus spending on hostels. So always expect the unexpected.
Great tips, Matt. It’s easier to budget if you have a rough idea of how much things cost in the country you’re planning to visit. Research!
Want to eat and drink? Check the travel boards about a country’s current prices (if you can get past the smarmy know-it-alls). I was stunned in Thailand at the price of beer, even from a 7-11. It was an overly dry three weeks.
I’m aiming to go travelling around South East Asia towards the end of the year (though only for about 3 weeks) to see if I like it and whilst I’ve been looking into the cost of things, I wasn’t quite sure how to budget…thanks for the tips!
These are all great tips Matt. People write to us, too, about the budget, and want to know exactly how much they need to save. And it is not that easy! Where you want to go, what you want to do, and what your priorities are dictate that budget. But figuring it out right will allow you to travel as long as you want. Can’t stress enough about planning the unexpected-I had to fly home in the middle of our trip (unexpected) but b/c of good budget planning and travel insurance, it did not affect anything other than our timeline. And we’re still going….
Good article – and I agree with you about the hostelling. I just stayed at a hostel in Brooklyn last week and most of my money went toward food and drinks. I don’t regret spending on the amazing food, but next time I’ll have to find out where all the dive bars are for cheap drinks.. Kinda pissed that I paid $4-5 for the exact same beer we have in my city at home.
When I moved to Paris I figured out exactly how many euros I could spend per week for my entire stay without running out of cash. Having a figure in mind every week was incredibly helpful. I stayed on budget, and even had enough left over to extend my trip by six weeks!
costs and therefore budgets all depend on what part of the world your travelling in. What tips have you got to find out costs and hence budget before you go? Stevo suggested using travel boards, any particular recommends ?
For holidays, a daily budget is definitely the answer. That way, if you splurge one day, you can live cheaply for a couple of days, and vice versa. I don’t see the point in going away if you can’t do what you enjoy. It’s better to save for longer so you can have the kind of trip you want to have.
For long term travel, the answer is to work. My husband and I are travel writers. We never think about how much we spend. If we spend too much, we simply think – we better do a story on this place, or this restaurant or whatever, to make up for it. But I always talk to waitresses in restaurants, the guy behind the bar, the bloke on the reception desk, and it’s amazing to find out how many people are foreign – all over the world – and they’re living and working in a place for a few months, six months, a year or more. They’re getting to know a culture and language and people in a way holiday-makers can’t, they’re exploring the place when they’re not working, doing trips on weekends, and then doing extended travel in between jobs. If I wasn’t a travel writer, that’s what I’d be doing.
Make your budget stretch by talking to locals and find out where the cheap eats / drinks are – avoid eating / drinking at tourist traps – traveel by public transport but not taxis – cost of living index – research – research – research!
When I first read this I thought this was obvious stuff, then I realised I don’t actually do things like this myself.
I don’t have a daily budget and I like to eat, drink, do the odd tour, catch a movie at the cinema, couchsurf and meet other travellers in hostels, everything whilst on the road. But I do keep an eye on my finances very carefully and do a rough long term plan.
I could have an action packed day every day, but would probably be heading home now if that’s was the case. 6/7 days a week I’ll be just walking round taking photo’s and not spending anything except for food and accomodation if appropriate.
Maybe it’s just my mentality/personality, but I just stay frugal and alert of where my money is going with a bit of inital groundwork to get the best prices on things. I’m staying in Australia at the moment for Oz$10 (US$7) a day with food, internet and accomodation included and it’s fairly easy to earn that here.
Hiya! Where in Oz are living when you can get by on $10 a day with food and accomodation? My boyfriend and I are actually going to be in Oz in Sept/Oct time and it would be great to know as we are trying to budget!
Great tips – I also like Hospitality Club (http://www.hospitalityclub.org/) for cheap accommodation and often hosts will play tour guide too!
It also helps to have a good idea of how much you should be spending on what on a per day basis. If you know you have $X per day for food, then you should adjust your daily spending to account for the days you overspend or underspend.
Your suggestions on budgeting work well in a non-traveling life too. But I’d much rather be abroad and use your suggestion than sitting here in Texas. Cheers.
Matt is right here. I’ve met too many people who have had to cut their trip short because they were running out to money. Some people like to live that way, but I do not, as I usually have some sort of end goal in mind before I leave.
Use your guides. Most guides will tell you what type of daily budget you can expect. While this gets more difficult in places like Europe. In Asia, for example, you can expect to spend under 15 dollars per day for food and accommodation. We walk everywhere, we don’t take tours for the most part, and we take public transportation. I wrote an article about a year ago, How to Travel for a Year.
It would also be a great idea to get some sort of teaching certification if you plan on traveling for an extended period of time. When you run out of money, stopping to teach English is easy to come by in most non-English speaking countries.
Sometimes having someone else manage your trip can help you save money. I travel to Paris a lot. When I used to go years ago, I didn’t have the knowledge to find the most economical hotels, where to eat, or how to tour. For instance, I used to take a taxi from the airport to the city and I used to pay separately for each admission into a museum. Now I know about less expensive ways to do things. I think I spend less on my Paris vacations now than I did 10 years ago.
There are tour operators like Rick Steves who will do everything for you, but they get somewhat expensive. There are smaller tour operators that you can find, if you look, who will give you more bang for your buck.
great blog and very informative just like this ezines one Travel Asia And Jobs – http://link-broker.net/jk.cgi?i=b8PumzS&d=ezinearticles.com%2F%3FMaking-Money-While-Travelling-Helpful-Tips-For-Backpackers-to-Stay-on-Budget%26id%3D3581486&n=30
Well, talking about budgeting is all well and good, but when the money runs out and you have zero or less, you can’t budget that. You just can’t do anything anymore. And when you go to places where the people you meet either don’t want to help you or would love to but can’t because they’re in the same situation as you, you are all just screwed. That’s what happened to me in England. I was probably the only one there for a maths teaching job, but everyone else I met, in their shelters and soup kitchens, had also come there for a job and then not gotten it when they got there. But the British don’t tell you the truth up front about why not and you just keep trying, that’s all they tell you to do. Just keep applying everywhere and “it takes time.” Then you wind up totally skint, on the streets, and then really unemployable and screwed because no matter what your qualifications are, British society being what it is, no one is going to hire you if you wind up homeless – figuring that’s the logical way to get you OFF their streets. Logic doesn’t factor into it. But they don’t tell you that before you show up.
My point is, budgeting your money is fine. But when you came there expecting a job and only had so much in your account, and when you get turned down for the job when they see you in person (as opposed to the telephone interview that got you the offer in the first place), and can’t get anything else either, you can’t budget zero. You just can’t.
do you have some kind of income? I understand about the part of being realistic on budgeting, but how do you get an income when your out traveling? do you work? or did you saved up alot of money way before you decided to travel?
One thing i always find very surprising is how much effort travellers put on saving money while on the road, spend less and so on…….
In MANY cases, if they put 50% of the effort in saving , into doing something lucrative, they would have 100% more and 100% more time to spend the extra money they earned….
I know, many times saving and spending less, it´s part of the travelling adventure and fun , but sometimes for sure not:)
Specially nowdays that you can do so many thing with a laptop and an internet connection……
cheers,nice web site
Good article Matt…
Pamela, I am truly sorry for your experience of not finding work in London. But you shouldn’t let it shape your view of England as a whole (or even London). It’s a great city and although there are of course many people wraped up in their own stresses and problems, there are many friendly people and places you can turn to for help. I am a Londonder and have recently returned from an extended period of travel. I am now so much more aware of how daunting this city can be to visitors – if I ever see anyone with a map looking confused as they are jostled around the busy pavement I stop and ask if they need help. A small gesture, but one I hope makes people realise that Londoners can be friendly!
Pamela – sounds like you have had a rough trott.
however i would argue that you can budget for that (jobs not coming t fruition, and money runnig out. I would suggest everyone also budget for the unexpected, ie. a wad of cash tucked away for 2 months of being unemployed until jobs taken up. or what i call my financial backupplan (ie. fly out in emergency situation, get robbed of every cent, etc etc)
i tuck my finacial emergency plan away onto another card. so i always know that i have $x000 remaining. then when i need to crack into that i know i am on my last legs!
not having a go at you, just offering advice for other people who are at the planning stage