How to Create a Travel Budget
"A good traveler has no fixed plans, and is not intent on arriving." While that free-spirited approach might have worked for Lao Tzu, globetrotters with finite funds have less room for spontaneity. Drawing up a travel budget can feel like an overwhelming task, but planning your expenses before you hit the road can save you from a massive credit card bill upon your return home. Though it's nearly impossible to anticipate every vacation expense, you can generate a rough estimate while leaving enough monetary flexibility to be impulsive. To find out how an expert crunches the numbers, U.S. News spoke with Orbitz.com's senior editor Jeanenne Tornatore; she gave us the scoop on how to start planning, what tools to use and when you can still afford to be spontaneous.
Do your research
Many of us already spend a good amount of time researching our vacations, so this first step of the budget-planning process shouldn't be too foreign — you just need to take your research one step further. Plane tickets to a certain destination may be cheap, but what about hotel rates, transportation expenses and entry fees to attractions? Before you book a flight, conduct plenty of research to formulate a preliminary estimate of what the destination will cost you. Tornatore calls this "vacationing within your means." Once you've figured out the airfare, don't forget to consider how much of your budget should be allocated for getting around (including airport parking and transfers). And if you're renting a car (or bringing your own set of wheels), use a site like Gasbuddy.com to determine your fuel expenses. The trip calculator can give you an estimate based on the miles you're traveling and the type of vehicle you're driving. Of course, the cost of getting to and from your vacation locale is only a fraction of the overall budget; don't forget about the other biggie: accommodations.
Explore all lodging options
In addition to your transportation costs, Tornatore says that lodging should be one of the first elements you budget. The key is finding the type of accommodation that best suits your needs without overextending your funds. If you're traveling with a big group, renting a condo can sometimes be less expensive than renting several hotel rooms. Plus, condos offer more cost-effective amenities, like kitchens and refrigerators, which will help cut back on meal expenses. Tornatore also offers this fundamental tip: Look for hotels that offer a continental breakfast every morning — it's one less meal you'll have to account for. But if you're the type that thrives on the spontaneous nature of travel (or maybe you're just a procrastinator), sometimes waiting until you arrive to figure out your lodging can save you some cash. Smartphone apps like Hotel Tonight and JetSetter offer significantly reduced rates on unfilled hotel rooms. The only catch: The deals change daily, so there's no guarantee the bargain you see today will be available tomorrow.
Book some activities in advance
Tornatore recognizes that not all of your trip activities can or should be pre-budgeted, but she recommends that "large budget items, like tickets to Disneyworld, should definitely be planned ahead of time." Why? You'll often receive a small discount by purchasing online. In fact, Orbitz found that 30 percent of users add on activities when booking vacation packages (such as airfare, hotel and car rental bundles) because prices are locked in at a lower rate than day-of entry, according to Tornatore. Tornatore also suggests pre-reserving tickets for entertainment (like theater performances or concerts) since prices will often rise for same-day tickets because of demand. If you prefer a little more flexibility with your itinerary, you can take a chance and find reasonable last-minute deals on attractions using Viator. It's a website and app that offers discounted tours and activities in destinations around the world.
Be conscious of food costs
Unless you're staying at an all-inclusive resort where meals are bundled with your room rate, you'll need to create a generous budget for food. As well as one, two or three meals per day (including gratuity, if you're eating at restaurants), you'll want to account for the expense of snacks and drinks in between. If you plan to spend a day at the theme park (or even at the airport during a long layover), remember that food prices can be significantly higher. To avoid overpaying, shop for some non-perishable snacks at a local supermarket once you arrive and stash them in your hotel room. Also, take advantage of that free continental breakfast: Snag an extra banana or muffin and save it for later. For those of you who have opted for a fully equipped kitchen in a condo, budget for a week of groceries the same way you would at home.
Set aside an emergency fund
An emergency fund is important to consider, even if you (hopefully) never dip into it. This budget could include visits to an urgent care facility or the extra cost of buying over-the-counter medication in a pinch. Check with your insurance company to see if you'll incur any out-of-network costs for a visit to the doctor, or consider purchasing travel insurance to offset any unforeseen medical expenses. Take a look at InsureMyTrip.com to compare travel insurance providers and plans and read customer reviews. For this (and all your vacation fees), make sure you diversify your funds; carry some cash, a credit card and an ATM card — but not all at once. Leave whatever you're not carrying with you that day in your hotel safe. If a pickpocket manages to steal what's on your person, you don't want to be completely high and dry for the rest of your trip.
Consider the cost of staying connected
If you're traveling overseas, consult with your cell phone service provider to see if you'll have to account for fees in international destinations or if you should purchase an international data plan. Aside from the charges affiliated with texting and calling overseas, roaming data usage (for apps like Instagram and popular social networks like Facebook and Twitter) can also put a major (often unforeseen) dent in your budget. If your carrier doesn't offer a package for international data usage (most do, but it'll cost you), don't worry — you don't have to fall off the grid. WhatsApp allows you to send and receive SMS messages, pictures, audio and video notes without added network costs. The app is free for the first year, and 99 cents every year after.
Leave money to spend
Whether you use it on souvenir coffee mugs or a spur-of-the-moment daytrip to a nearby town, having a little wiggle room in your budget won't make your vacation feel so restricted. If you're over budget, this is also the easiest category to trim.