How to Make Your Money Last

moneyI get a lot of questions about travel in my inbox. 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. How is it that I’ve made my money last so long? This a great question and an important thing to discuss so this blog post is long overdue.

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 make your money last is to be smart about how you spend money and 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.

euros moneyThe 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 buy a new camera after falling into the ocean with mine or taking a last minute flight to Fiji from New Zealand to meet friends. Stuff happens on the ride.

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!” “This place is more expensive than I thought.” You hear these comments on the road a lot and my response is usually “Why? What did you expect to do on the road?” If you do your research well, you will know exactly how much things cost and you can plan you budget accordingly.

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 about what you want to do with your travels.

Moreover, track all of your expenses. I write down everything I spend money on. This way you can keep track of your expenses and know if you need to reduce your spending. The people who have to go home early are always the ones that have no idea how much money they are spending on the road.

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 constantly going over your accommodation budget.

Keeping to a budget is obvious but sometimes the most obvious things are the ones most forgotten.

  1. 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.

  2. Stevo

    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.

  3. Serena

    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!

  4. 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….

  5. 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.

  6. 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!

  7. Wonderwilm

    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 ?

  8. 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.

    • Prav

      Hi I am traveling at the moment and would love to get into travel writing …can you give me advice on how to get published and where to start …thanks

  9. 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!

  10. 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.

    • Katrina

      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!

  11. 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.

  12. 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.

  13. 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.

  14. 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.

  15. Pamela

    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.

  16. shenandoah

    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?

  17. Mariano

    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

  18. kk

    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

  19. Hi Matt,
    I want your life! I love to travel too and have always wanted to just take off and travel around the world indefinitely. The most I’ve been able to do in recent years is 3 1/2 weeks… Your philosophy about budgeting your money is spot-on. You definitely need to be smart with your money, and most importantly “live” and take in the culture.
    Happy travels!

  20. chris

    If you’re in need of funds would you be able to get a temporary job with a tour group, such as checking on this before departing or if knowing schedules of the groups connecting with them when they pass through an area?

    • NomadicMatt

      Tour companies don’t really hire temp workers. They want employees who will stay awhile as they need to be trained and licensed by the government.

  21. Great, informative article Matt! The only thing I partially disagree with is “If you love outdoor activities, over budget because they cost a lot.” Going out drinking in almost any city costs more than being in the outdoors.

    If you ever travel with me I’ll prove you wrong 😉

    1. Aside from a menial national park entrance fee from time to time the forests and the mountains never ask for money while I set up my tent.
    2. The crag and rock face never charge me while I set up my rope and anchors for a climb.
    3. The high calorie high protein dehydrated food I made for a two day trail-run cost a lot less than eating dinner at a restaurant.

    Sure, climbing Aconcagua will set you back due to the permits required to summit it and taking a reputable mountaineering course will set you back hundreds if not thousands of dollars. But aside from those exceptions nature is practically free.

  22. Great points to cover. I Agree with them all! I guess “working” during long term travel also helps! I’ld like to also ad another interesting and possible point! BARTERING. You can barter. This is exactlly what me and and my Girlfriend are doing in “”. We barter our design services in exchange for accomodation, food, heavy discounts etc. But you can also barter a few weeks in a remote jungle isalnd bungalow in exchange for work in a guesthouse. All I can say is : GET CREATIVE! The possibilities are endless!

  23. David

    I am really bad for over spending, i just cant deny myself sometimes…..Especially when i’m out for the night! But when i look at my bank account and i see the money is running low i can very quickly pull it together. This is why when i organised my RTW trip i had my Mum deposit my budget into my current account (600euro/month). That way i just didn’t have the money and i would have to wait a week or two before the next installment. Worked well!

  24. Great idea – I live by my dear old grandpa’s philosophy – look after the pennies and the pounds will look after themselves! If you think the small stuff won’t add up, you’ll be in for a shock at the end of the month! My budgeting has allowed my to travel for 18 months so far and I’m still going strong :-)

  25. If you really really want to travel on budget, then don’t buy a thing you don’t need – regardless whether on trips or while at home.
    Bring you own food. If you’re really good at this, you can survive for 5-7 days without buying a single piece of food. But of course, you’d also want to taste the local delicacies.

  26. Backpacking is still the cheapest way to travel and doesn’t cost you a lot of money. You can also find local families to stay with. It’s a great way to interact with cultures and save money. :)

  27. Russ

    I took my dad and nephew on a week long expensive Disney cruise/park trip. From extensive investigation I knew how much it would cost including excursions. I simply set up an allotment from my pay into my credit that would generate that amount. Then I had to live on what was left so out went the restaurants, vending machines, coffees, cable, drinks, and mall visits. In came rice & beans, PB & J, tuna, water, eating all those weird things in the back of the kitchen cupboards, walking or riding my bike to work, cutting my own hair, wearing older clothes, visiting the library and enjoying long walks. I had more than enough for the trip by the time it came.

    Recently went a beach resort area, but stayed in my tent (off season rates are cheap), cleaned up at their shower house, breakfast was oatmeal and coffee from hot water over my backpacking stove, had nice dinners at the early bird rates around 4pm, and was able to stay a whole week versus the 2 days a hotel would have cost.

  28. Pete deMatteo

    We just got back from Cap Haitien, Haiti. We loved it but since we didn’t know about how desperate everyone was and how expensive everything was, we really spent a bundle. It seems best to get your taxis through the hotel management and to realize that there’s only one ATM in the city which usually doesn’t function, calling for money transfers at local banks, which is an ordeal, to say the least.

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