Budget

Working out the budget for your big trip is one of the most important pre-trip hurdles every traveller faces. Unless you have an unlimited budget (which we don't) working out how much money you need to sustain yourself on the road is the difference between a trip of a lifetime, or a nightmare of declined credit cards and broken dreams.

"I'm sorry ma'am, cash or credit only. We don't accept tears of despair." photo by: smemon

While there are plenty of how-to books and budget guides, the best resource I can recommend is your fellow travellers.Travel bloggers, web forums and crowd-sourcing websites such as Budget Your Trip can be a godsend, however keep in mind that there are many ways to travel and your personalised budget needs to allow for your own travelling style.

Whether your budget be Low-end (hostels), Mid-range (hotels), or Shoe-string (Couchsurfing and WWOOF-ing); checking into accomodation prices can be a good start on working out a daily goal that you can build into a larger budget. For most locations a daily spend of 30-60 US or Euro per person is average for a low-end traveller.

However be careful of falling into the trap of misjudging your budget due to budgeting what you hope to spend - rather than what you are likely to spend. You will still be you while travelling. If you are addicted to coffee and glossy magazines now, two months backpacking Europe will not change that. Look at your current grocery bills, your food budget on the road is likely to be similar - if not double that expense.

photo by: images_of_money

This will vary depending on where you want to travel, but don't assume just because, for example, Thailand is cheap, that you do not need a solid budget, or some wiggle room. Some parts of the world may cheaper to travel in, however they also may lack amenities that allow you to take full advantage of this as a traveller.

For example, hostels in South East Asia rarely have kitchens therefore all of your meals will be takeaway. While street food is brilliantly cheap and generally very tasty, after a full day walking around you will end up paying a higher price for a cafe with seating and, in summer, air-conditioning.

photo by: kamaski

Once you add all this information together you'll have something resembling your budget. Don't worry, you can modify it with any new information you come across later, but this is your start.

From there a good rule of thumb is to add 10%. Seriously, just do it. If you find yourself in a bind (which at one point - you will) you will be happy you have it. If for some miracle you don't need it - brilliant! Always better to be coming home with money rather than in debt. Put all the information you have down on paper and it should look something like this:

Now you're ready to start saving!

Hard-core saving is tough. But, if it makes you feel better - it is hard for everyone. No one walks away from serious saving and says "Wow that was a walk in the park!" The best tips I've found for saving money that I follow religiously are:

Tip 1: Know what you’re saving for. 
Alex and I both have shocking will power and need to constantly motivate ourselves towards saving. We find the best way is to subconsciously remind yourself constantly. We had a giant map on the wall of all the places we want to see. Travel photos cut from magazines littered our fridge and above our sink for when we would wash-up. We had them pasted above the TV and even in the car! I carried a small picture of when I lived in Spain in my wallet, so when I would go to reach for that $2 for a coffee, or bottled water, I would ask myself...Which one would I REALLY rather?

Tip 2: Set baby-step goals.
This one's fairly easy. We find by documenting our weekly savings we set ourselves a base goal that we can meet every week whether or not it has been a bad week financially. Even the weeks when we just scrape by that goal, we feel a sense of achievement that spurns us to save more the following week

Tip 3: Do not remove money from your savings account. Ever. Instead, create an “oh shit” fund. 
This one’s not so easy, at least until your emergency or "oh shit" fund is up and running. You want to keep a minimum easy 1k in there at all times. Although this may not cover all emergencies it will cover most of them. Enough that you can swing by without the urge to dip into your savings.

Tip 4: Save the small stuff 
This is a fantastic habit to get into. We kept a small wooden Tardis moneybox by the door that simply filled up with all the loose change, and small coins you find under the couch or in a forgotten pocket. Believe it or not, these really add up! And if you find yourself saving extreme amounts for maximum gain this mini fund can be a lifesaver as 'fun money' once a month empty it out and just do something fun. This keeps spirits high, but doesn't cost your main account as this is money you never expected to have.

Tip 5: Sorry, but you can’t do everything you want to do and save a bunch of money
Unfortunately a big reality of being an adult is that we can't have everything we want. Those shoes or that game may be so perfect and a bargain, but you need to ask yourself - Do you need this item? Is this item worth an extra day in Jordan? Sometimes this can mean huge sacrifices. Like not flying home to see all your friends and family for holidays, even when you miss them so very much. That can really suck.

And sometimes there can be compromises. But you have to take the sucky bad with the soon to be good, for it will all be worth it once you're rolling down that tarmac.

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For more awesome Budget info check out these Budgeting articles: 
 - Planning the Benjamins 
 - How Much is Your Fear Worth - How About $2000? 
 - Getting Back on Track 
 - Updates and Excitement! 

 - Budget Roundup - AKA How Much Did We Really Save?
 - How We Spent Our Money: Six Months Later