Travel budgeting is a tricky one. When you go on that big overseas adventure, you’re supposed to try all sorts of new things, from exotic foods to extreme sports. You’re supposed to be spontaneous, wild and free. But ironically, being free costs money – and often lots of it.
When we talk about the beauty of travelling, we tend to forget about all the planning and discipline that goes into a big trip. But, trust us, it’s a thing. You’ve got to be sensible enough with your money to actually save up to go away in the first place. You’ve got to find that happy medium between the adventurous cool dude and the money-wise planner nerd, even if you don’t publicly admit it.
How much do I need to save?
If you’re planning to travel somewhere you’ve never been, it’s hard to know how much cash you’ll need to put away. A good option is to figure out a daily budget for your destination(s), then multiply that by that amount of days you plan to go.
For example, in Bali you can live pretty well on $60AUD per day. So if you want to stay for a month, that’s $1,800. Then you’ll need to add on the extras, such as flights, travel insurance and specific activities that might cost extra. You might find that you want to have about $2,800 – $3,000 for the trip (although it’s very dependent on how comfortably you want to travel and what discounts you can swing – there are cheaper ways to travel).
If you’re unsure how to figure out a daily budget, Lonely Planet has costs guides for basically every country you’d want to travel to. Here’s the one for Indonesia.
Once you’ve figured out a daily budget, how long you want to go and the extra expenses, you’ve got your budget. Now you just need to start saving for it.
Let’s stick with the example of the Bali trip for one month. If you’re putting away $280 per week, it’s going to take you 10 weeks to pull that cash together. That’s two and a half months. Obviously if you can’t put away that much it will take longer and if you can put away more it will take less. It’s all about planning your money strategically, which you can read all about in everyday budgeting.
There are some additional ways you can help give your savings that little nudge. There’s bank accounts out there that will actually reward you for stashing your cash away (yep, with real money) in the way of interest. The Westpac Life savings account, for example, will give you bonus interest every time you end the month with more cash in your account than you started with. And even if you’ve slipped up and haven’t managed to save anything for the month, you’ll still get rewarded for trying with a pretty competitive variable interest rate (1.5% p.a. if you were wondering, which goes up to a variable 2.3% p.a. if you do save that month).
Plusss, it has some other nifty features that are specifically designed to help you save for your travels (or anything else you want to save for). Basically, you can set a savings goal of the amount you need for your destination, and the time frame you have to save it in. Then, every time you get money in your account, you can choose how much of it you want to put towards that goal, and the progress all gets tracked for you. You can see when you’re lagging behind and when you’re spending way too much money on other stuff. Suss out how it all works here.
As previously mentioned, travelling is supposed to be spontaneous and wild and free. So how are you going to be a wild and spontaneous vagabond if you’ve got a daily budget to abide by? Maybe you need to get yourself an extra buffer, for all those days you “accidentally” splurge a little bit. Maybe you want to save up an extra $1,000 – $2,000 just so that you can enjoy your holiday to its fullest.
There’s also the possibility that something really bad could happen. You might lose your passport, miss your flight or find yourself in some other twist of fate. In this case, you’re going to need a contingency plan, which is best in the form of cold, hard cash. Consider saving up an extra chunk of savings that you don’t intend to spend. Just in case.
If you’re keen to get saving for your travels, check out the Westpac Life savings account to help you keep on top of your cash.
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This information is intended to be general in nature and should not be relied upon for personal financial use.