Unless you’re working on the road or have some other means of location-independent income, once you depart for your trip the amount of money you can spend becomes finite. If you’ll be spending a long time abroad, then you need to take a long look at how you plan to budget. Credit cards are great for that rare occasion when you spend more than you have, but it’s not a great habit to get in to. With the inevitable post-travel blues you’ll suffer from upon returning home, saddling yourself with debt is like adding insult to injury.
The good news is that with a little discipline and some planning, you can stay on top of your finances on the road and make sure you don’t come home penniless. Maybe that’s not entirely true; but at least if you spend all your money you’ll know you did it on purpose, not because you made a mistake. And that makes all the difference.
For starters, you need to figure out how much money you’re taking. Then figure out how much you can spend per day. It’s a good idea to over-estimate your spending rather than figure on less than you might realistically need. Keep in mind that although you might hear it’s possible to get around in some places on $10 a day, that will take discipline. Realistically you’ll be spending $15 a day or more unless you’re prepared to stick with your decision. Once you get in-country, it becomes more a challenge to keep your budget goals. Give yourself some flexibility for the occasional unplanned splurge, as well as for unanticipated expenses. The bottom line: don’t make your budget too tight. Make sure you don’t forget things like visa fees and exit taxes, which can add up quickly.
Once you’ve got your daily budget figured, you need to keep track of what you spend each day. We kept a notebook that we updated daily. Not only did we use it to keep track of our spending, but it was also a great way to help us remember where we were and what we did each day. If you start writing everything down, it’s easy to find out at a glance how much you are spending, and what you are spending it on. If you’re coming in under-budget, then you know you can take things up a notch if you like. If you’re spending more than your budget, you can either re-evaluate your situation or find ways to cut corners. If you don’t keep track of your budget while you’re traveling, you run the risk of finding yourself in a budget crisis. That’s a sure-fire way to bum yourself out on the road.
One key thing to remember is not to get too caught up in your day-to-day budgeting. If you find yourself stressing out, not doing things you really want to, or always thinking about money, then you need to take it easy. Hopefully you’ve given yourself some wriggle room, so you can make some adjustments without jeopardizing your trip. If you look at your budget on a week-by-week basis instead of a daily one, then you can spend more on some days and less on others to even things out at the end of each week.
Budgeting shouldn’t keep you from enjoying your trip. If you plan things out right and exercise just a little discipline, it can make your life easier and keep you fully in control of your bank account when you’re halfway around the world.